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April 11, 2018  

Tudor Ends Backing for LaunchPad Venture

Tudor Investment has cut its ties to LaunchPad Trading, a joint venture it formed in 2015 to seed up-and-coming macro traders.

Tudor and its former partner, HC Technologies of Chicago, set out to invest as much as $200 million in LaunchPad, with the aim of backing some 20 portfolio managers, lending technological and operational support, then helping them raise outside capital. But following the expiration of a three-year contract, Tudor exited the joint venture, leaving HC to go it alone.

The formation of LaunchPad was closely followed in the macro and managed-futures community, given the involvement of both Tudor and HC, which is led by veteran futures trader Joe Niciforo. Niciforo began his career at Tudor 30 years ago.

“We want to provide an environment where [traders] can get that experience,” Tudor founder Paul Tudor Jones said when the joint venture launched.

But the intervening years haven’t been easy for Tudor. The New York firm’s assets have plunged to about $7 billion, from $15 billion, forcing it to lay off staff and cut fees to retain clients. In December, Jones told investors he would lead a turnaround effort by personally managing the biggest chunk of risk. “It has been a frustrating several years for macro trading and for me especially,” he wrote at the time.

“Great idea, just bad market conditions,” a source said of Tudor’s involvement in LaunchPad. “And Tudor had bigger fish to fry.”

HC, a proprietary-trading operation with about 150 staffers, has rebranded LaunchPad as HC Capital, and moved its headquarters from New York to Chicago. LaunchPad’s chief executive, former Tudor executive Nancy Andrews, no longer works there.

At its peak, LaunchPad had about 12 portfolio managers in its stable. HC currently is seeking to raise outside capital for four managers, while also searching for fresh talent. It is looking at quantitative-investment professionals across a range of asset classes — not just macro and futures traders.

One LaunchPad portfolio manager, Matthew Piselli, received a $10 million investment in September from Ceres Managed Futures, a unit of Morgan Stanley. Piselli has since spun off from LaunchPad to form Buttonwood Merchants, a discretionary-macro operation. On March 1, Ceres transferred its account to Buttonwood. Piselli, previously the head trader at Gresham Investment, has hired former LaunchPad marketer Carter Evans to focus on business development at Buttonwood.

Other traders who received backing from LaunchPad include former Prologue Capital portfolio manager Alec Kiel and Shane Grimaldi, who recently joined Ben Melkman’s Light Sky Macro.