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Hedge fund Caxton is no longer paying £700k a year in London

Macro hedge fund Caxton has been around a long time. Founded in 1983 by U.S. investor Bruce Kovner, it's one of the granddaddies of the hedge fund world. It has seen ups and it has seen downs. Compared to 2020, 2021 looks a lot like a down.

The fund just published results for its UK entities - Caxton Europe LLP (the partnership) and Caxton Europe Asset Management Ltd. Both confirm that 2021 wasn't nearly as good as 2020. 

Turnover at each entity went from £275m in 2020 to £138m last year. In the process, Caxton's European operations went from a £217m profit in 2020 to a profit of £108m last year. That profit was distributed among its 14 partners, who included portfolio manager Jim McKeever (once a trader at UBS), chief risk officer Matt Wade, portfolio manager Arjuna Gamage, portfolio manager Christian Deazely and senior portfolio manager Anil Kamath. On average, each partner received £7.7m, instead of the £16.7m they were awarded in 2020. 

Salaries and bonuses for other staff fell too. In 2020, Caxton Europe Asset Management Ltd. paid each of its 75 employees an average of £699k ($753k). In 2021, that was down to the merest £295k each. 

Caxton's long-serving employees are fairly familiar with earning this smaller amount, though.  In 2019, when the fund made a £10m loss, employees were paid an average of £327k each. Nonetheless, this year's pay is worse than during that nadir.

In February 2022, Caxton raised the management fee on its flagship Global fund from 2 % to 2.25%, while it increases the vehicle’s performance fee from 22.5 per cent to 25 per cent

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Photo by Julian Hochgesang on Unsplash

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AUTHORSarah Butcher Global Editor

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