FX Concepts to exit investment management amid dwindling assets

“Assets at the firm have dropped to levels that can no longer sustain the business,” Robert Savage, the chief strategist at FX Concepts, said in an e-mailed statement.
OCT 10, 2013
FX Concepts LLC, the currency hedge fund founded by John Taylor that was once the world’s largest, will shutter its investment-management business. “Assets at the firm have dropped to levels that can no longer sustain the business,” Robert Savage, the chief strategist at FX Concepts, said in an e-mailed statement. “The board has concluded that it is in the best interest of the firm’s investors to conduct an orderly wind-down of open positions, close its funds and hand back any remaining mandates to clients.” The New York-based hedge fund’s assets under management shrank to $661 million as of Sept. 26, from about $12 billion in 2009, according to data from the company’s website. The San Francisco Employees’ Retirement System voted on Sept. 11 to pull the more-than $450 million it had invested with FX Concepts. The closing of the company’s funds will take place over the next couple of weeks, the 50-year-old Mr. Savage said in the statement. FX Concepts will keep its newsletter and foreign- exchange overlay advisory businesses operating, he said. Hedge funds that seek to profit on macro-economic events trading anything from currencies to commodities have had negative returns of 10% this year, according to data compiled by Bloomberg. Volatility in the $5.3 trillion-a-day foreign-exchange market rose in the first half of the year at the fastest pace since Lehman Brothers Holdings Inc. collapsed in 2008, catching traders off guard and wiping out gains from strategies such as the carry trade. FX Concepts’ flagship fund, the $619 million Global Currency Program, had lost 13.9% through the first eight months of this year, according to a company report. The $16 million FX Concepts Multi-Strategy Program declined 10.96% year-to-date through August, company data show. FX Concepts, which was founded in 1981 by Mr. Taylor and calls itself one of the oldest currency-only hedge funds, saw its Global Currency Program lose 3.11% in 2012 and 14.47% in 2011. Taylor, 70, is attempting to sell a co-op he bought on New York City’s Upper East Side in 2010 for $25 million, according to a Sept. 13 report from The Real Deal. The purchase, which was for $4.5 million more than the asking price, was funded with a $20 million loan that was taken out from FX Concepts in June 2010, according to the report. (Bloomberg News)

Latest News

Merrill lands four advisor teams as May recruiting data shows firm's two-way churn
Merrill lands four advisor teams as May recruiting data shows firm's two-way churn

Merrill's latest hires span Colorado to Louisiana, even as industry-wide recruiting data suggests the firm is losing almost as many advisors as it gains.

Fund manager sues Kandeo, alleges $100 million FinSocial loss
Fund manager sues Kandeo, alleges $100 million FinSocial loss

The $36 million buy allegedly hid inflated books and a $50 million diversion.

Advisor gets $200,000 from Ameriprise in 'emotional distress' lawsuit
Advisor gets $200,000 from Ameriprise in 'emotional distress' lawsuit

“An award citing emotional distress is very unusual,” an industry executive said.

Workplace financial education linked to stronger financial habits, but participation remains low
Workplace financial education linked to stronger financial habits, but participation remains low

New EBRI research found workers who participated in employer financial education reported higher confidence, literacy and financial satisfaction.

The rise of the super advisor: How AI is redefining competitive advantage in wealth management
The rise of the super advisor: How AI is redefining competitive advantage in wealth management

Beyond operational excellence, the winning advisors of the future are the ones who can reach across multiple disciplines without discarding specialist skills.

SPONSORED Direct indexing webinar targets tax-loss harvesting amid market swings

Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains

SPONSORED Who builds the income when the pension disappears?

Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income