03/03/2010

Ex-SAC Manager Opening Fund to Outsiders

Neil Chriss, a former SAC Capital portfolio manager who launched a hedge fund in 2008 with backing from Renaissance Technologies, will soon open the door to outside investors.

Chriss' Hutchin Hill Capital Master Fund will begin accepting subscriptions sometime in the second quarter, but the opening could be brief: The $400 million vehicle is expected to raise another $600 million-plus within 12 months, then close to new investments. If Chriss had chosen not to cap the fund, market players said, he easily could have raised $2 billion overall.

The multi-strategy fund is expected to generate strong demand in part because Chriss has never had a down year as a portfolio manager. The Hutchin Capital fund, which began trading in July 2008, gained 13% through yearend 2008 and 17% in 2009. Chriss' investment strategies include hedged credit and equities, arbitrage, global macro, event-driven and one-off opportunistic plays.

The vehicle was launched with $300 million of seed capital from James Simons' Renaissance, a $20 billion manager in East Setauket, N.Y. The seed investment came from the $7 billion Meritage Fund, which runs money exclusively for Renaissance partners, including Simons. The vehicle is headed by Simons' son, Nathaniel Simons.

Chriss worked at Steve Cohen's SAC from 2003 to 2007. He managed two of the five subfunds, including both quantitative and non-quantitative strategies, that comprise the multi-billion-dollar SAC Multi-Strategy Fund. Chriss' portfolios represented about 70% of the assets of the overall fund.

Before SAC, Chriss ran ICor Brokerage, an electronic-trading platform for currency options and interest-rate swaps. He founded the firm in 2000 and sold it in 2004. Previously, he worked at Goldman Sachs from 1998 to 2000, developing and managing volatility arbitrage strategies. Between his portfolios at Goldman, SAC and Hutchin Hill, Chriss has never had a losing year.

Chriss is chief executive and chief investment officer of Hutchin Hill, a New York firm he founded after leaving SAC. He heads a staff of 41. The firm's three other principals are Seth Padowitz, a former portfolio manager and head of quant research at HBK Investments; chief operating officer Mark Haas, formerly global head of Deutsche Bank's prime brokerage; and chief legal officer Gregory Racz, co-founder and former chief operating officer of Octavian Advisors. Racz joined last month.

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