SAC Capital: First in profitability and controversy
SAC Capital wasn't the number one hedge fund in 2012 as ranked by performance.
That honor, according to a Bloomberg Markets magazine analysis, went to Metacapital Management, which racked up a 38 percent gain in the first 10 months of the year. But SAC Capital did finish the year ranked first in profitability, while it tied for 86 in terms of performance.
The fund earned the most money because SAC Capital founder Steven Cohen "charges some of the highest fees on Wall Street. While most funds impose a 1 to 2 percent management fee and then take 15 to 20 percent of the profits, Cohen levies 3 percent and as much as 50 percent, according to investors."
Of course, he's earned that right over time.
"The fund manager, who's largely an equities investor, has produced an average annual return of 30 percent since starting his firm two decades ago. He's had just one money-losing year, 2008, when the flagship fund tumbled 19 percent. For calendar 2011, he and his managers shared $907 million. SAC Capital International has been closed to new investors since August 2011."
His incredible success has not been without controversy, a category in which SAC Capital is the de facto number one fund. One of the big stories of 2013 will be the approach that prosecutors take with the firm. In their mind, such returns over so long may be too good to be true. But now that Mathew Martoma has decided to go to trial, are hopes of a criminal indictment fading?
- here's the article
SAC Capital atmosphere grows tense
Mathew Martoma will not turn on Steven Cohen
SAC's "ruthless", "pressure packed" culture
SAC Capital probe expands
SAC Capital remains elusive target for Feds