Tiger Global has an AUM of $95 billion, that’s $57 billion more than Citadel’s AUM of approximately $38 billion.
The monster hedge fund is managed by Chase Coleman, 46, who was up until now considered to be a hedge fund legend.
Tiger Global Management had a rough 2021 according to sources and losses are piling up in 2022.
Hedge funds seem to be in a lot of distress recently.
Let’s break it down together.
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Hedge funds face turbulence in 2022
This year we’ve seen many hedge funds face massive adversity.
Hedge funds have been dealing with significant losses this year, probes from the DOJ, and scrutiny from retail investors.
Hedge fund managers once deemed leaders in their industry now have their reputation on the line.
Gabe Plotkin was named a great trader by Citadel’s Ken Griffin although the hedge fund had to bail Melvin Capital out due to the ‘meme stock’ frenzy.
Citadel pulled $2 billion from Melvin Capital in recent months.
Chase Coleman is in a sticky situation too.
Tiger Global Management is down 34% this year through March.
The speed of the reversal has shocked just about everyone, considering that Coleman is celebrated as one of his generation’s brightest stars, a standout among the elite money managers mentored by the famed Julian Robertson, Bloomberg.
Tiger Global Management treads rocky waters
The bad run has been fueled by massive bets on stocks that have been hammered, such as fast-growing tech companies in the U.S and China.
Tiger Global hedge fund lost 7% last year, its first annual drop since 2016 and its third total, according to Bloomberg.
Tiger Global told clients in a letter that it’s opening up both its hedge and long funds to a limited amount of capital from existing investors to bolster positions in stocks that underperformed
However, we see the results in the first quarter of 2022 has not been what the hedge fund anticipated.
Built by Coleman and his partner Scott Shleifer, Tiger Global has long been seen as a throwback to the industry’s glory years, when double-digit returns were the norm and ‘hotshot managers’ unerringly backed winning companies and shorted the losers.
Across the firm’s $35 billion in funds focused on public companies, this year’s losses have triggered a more than $10 billion hit to investors that include foundations, endowments and pension funds, as well as Tiger Global insiders.
Coleman’s personal wealth has dropped by $1.3 billion, according to calculations by the Bloomberg Billionaires Index.Â
Coleman’s hedge fund headed towards worst year
Tiger Global hedge fund may be on track for one of its worst years yet.
The blue in this chart indicates the hedge fund’s losses in 2008, 2016, 2021, and 2022.
The firm’s first serious bump was during the 2008 financial crisis, when it lost 26%, followed by a 1% gain the next year.
While markets were already jittery this year due to high inflation and expectations of rate hikes, Russia’s war against Ukraine triggered a flight from risk.Â
The Russia-Ukraine conflict has affected every corner of the financial sector.
Earlier we saw Citadel and other hedge funds faced default on Russian bonds from tech company Yandex.
But Tiger Global Management isn’t the only hedge fund struggling.
Investors are pulling out $250 million from Coatue Management and the hedge fund cannot meet its investors demands.
We’re beginning to see this domino effect of losses begin to catch up to even the biggest hedge funds in the world.
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