Jain's Fund to Manage Money Just for Millennium

Summary

Bloomberg's Hema Parmar discusses Bobby Jain's multistrategy hedge fund shifting to manage money exclusively for Millennium Management. She explains that the fund's $1.8 billion gross trading profit translated to only about an 8% net investor gain, showing the high cost of running a multistrat. The conversation also covers Millennium's evolution as an allocator and the cutthroat risk controls external managers can face.

• Bobby Jain's multistrategy fund made about $1.8 billion in trading profits over two years.
• Gross returns were about 41%, but net investor gain was roughly 8% after expenses.
• Hema Parmar highlights high costs and complexity of launching a multistrategy hedge fund.
• Millennium is increasingly acting as an allocator, seeding third-party hedge funds.
• External managers can get infrastructure and stable capital but face concentration risk.
• Millennium-style risk controls may cut capital at 5% losses and fire near 7-10% losses.
• Jain's move is seen as returning to Millennium and a way to keep the business going.