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Alternative Market Briefing

Hedge fund talent, fees take a hit at the Milken Global Conference

Tuesday, May 03, 2016

Bailey McCann, Opalesque New York:

It's been a rough year for hedge funds and now, even other managers are panning them. "Frankly, I’m blown away by the lack of talent," was Point 72 CEO Steven Cohen's assessment of trying to find candidates to hire in the investment business at a panel on the future of hedge funds yesterday afternoon at the Milken Institute Global Conference, currently underway in Beverly Hills, California. Cohen added that while he does most of his hiring and promotion from within, when it comes to finding outside candidates they are able to hire between 2-4 percent of the people who apply.

Cohen said one of the biggest problems is that the hedge fund industry has gotten too crowded and in some ways, too transparent as everyone is chasing the same ideas. "We were down 8 percent in February, which is a lot for us," he said. "In a lot of ways my worst fears were realized."

His views were echoed by Neil Chriss, CEO of Hutchin Hill Capital. "When the hedge fund industry started we were talking about several billions of dollars, now the industry is over three trillion. That's a fifteen-fold increase. But just because there are fifteen times the assets doesn't mean there are fifteen times as many managers who can run assets well."

Cohen and Chriss were on a panel alongside AQR CEO Cliff Asness, who ended up being the most upbeat about the hedge fund industry - a new role for Asness who is usually a critic. He didn't comment on ......................

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