Reuters- Hedge fund firm Pequot Capital Management, whose flagship fund gained 37 percent this year, will soon shut down three smaller portfolios due to “poor” performance and meager assets, twopeople said on Wednesday.
The $7.5 billion hedge fund firm will shutter its Strategic Equity Fund, its Event Driven Fund and its Dynamic Strategies Fund and allow investors in those portfolios to roll their money into Pequot’s other core funds, said one person familiar with the matter but not authorized to speak about it.
The move comes at a time many investors in the $2 trillion hedge fund industry are expecting to see hundreds of smaller funds die a quiet death this year as it becomes ever harder to raise money and lackluster returns are making it less profitable to run one of these loosely regulated funds.
The three Pequot funds are managed in San Francisco and had pulled in only a few hundred million in assets since they were launched in 2006. The funds are expected to be shut at the end of the year.
