Subject: Joe Scoby to shut Achievement Asset hedge fund, return money - Finance News - Crain's Chicago Business
From: "Eric Schwerin" <[email-masked]>
To: "Hunter Biden" <[email-masked]>, "Devon Archer" <[email-masked]>
Date: Tue, 17 Nov 2015 15:47:25 -0500

> http://www.chicagobusiness.com/article/20151116/NEWS01/151119868/scoby-to-shut-achievement-asset-hedge-fund-return-money <http://www.chicagobusiness.com/article/20151116/NEWS01/151119868/scoby-to-shut-achievement-asset-hedge-fund-return-money>
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> Scoby to shut Achievement Asset hedge fund, return money
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> November 16, 2015 <> </article/20151116/NEWS01/151119868?template=printart>
> Achievement Asset Management, the Chicago hedge fund firm that was associated with Peak6 Investments until it broke away last September, is returning its $875 million in hedge fund assets to investors.
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> The firm, launched <http://www.chicagobusiness.com/article/20130509/NEWS01/130509724/peak6-raises-1-billion-for-new-hedge-fund> by former O'Connor & Associates manager Joe Scoby in 2012, is returning funds to investors after negative returns in the mid-single digits this year, said Scoby, who leads the firm. His corporate bond strategy was particularly hard hit, he said.
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> “This is obviously not what we were aiming for and I just don't think my strategy makes a lot of sense in this market environment so I just decided to give everybody their money back and regroup,” Scoby said in an interview.
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> Hedge funds across the industry have struggled this year, with larger funds also closing down part or all of their operations, including Fortress investment Group, and others posting double-digit negative returns, like David Einhorn's Greenlight Capital. <http://www.forbes.com/sites/nathanvardi/2015/10/01/billionaire-david-einhorns-hedge-fund-is-down-16-9-in-2015/>
> Average hedge fund returns were down most months this year and the year-to-date results are just above breakeven at .03, according to Chicago-based Hedge Fund Research.
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> At its peak, Achievement's hedge fund had about $2 billion under management last year, but clients, including endowments, pensions and fund-of-funds, had pulled money out this year as returns declined. Scoby notified clients today and expects to return most of the money by the end of the year.
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> His 50-employee firm will continue operating to implement the return of funds and he will determine what his strategic options are with respect to the company.
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> Most of the workers are in Chicago, but the firm also has an office in London. For now, he's keeping $100 million that he has under management in liquid alternatives, which are hedge fund-like investments on behalf of retail investors.
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> Scoby bought out <http://www.chicagobusiness.com/article/20140918/NEWS01/140919777/peak6-investments-sells-off-hedge-fund> Peak6 co-owners last year and renamed the hedge fund operation Achievement Asset Management.
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> He had joined the Chicago trading firm Peak6 in 2012 to lead its asset management business, working with former O'Connor colleagues and Peak6 founders Matt Hulsizer and Jennifer Just. In that role, he began raising money for the new Peak6 Achievement hedge fund and landed $1 billion in about a year and a half.
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> Still, his main hedge fund strategy began struggling last year and slid about seven percent this year, Scoby said. While he said he had good returns on a long-short strategy as well as a convertible bond strategy, with OK results in a volatility trading, he was hurt on his corporate credit tack. ”The market conditions in corporate credit have gotten challenging,” he said.
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> He plans to have half of clients' funds returned by the end of this month, he said. He wanted to be true to his word and return the funds if he didn't believe he could deliver superior results in the short term, he said.
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> Scoby left open the possibility that he'll build something off the liquid alternatives business, perhaps acting as a sub-advisor to another hedge fund firm. “The first priority is managing the hedge fund correctly and getting customers their money back,” he said. “The second thing is, once that's well underway, to explore our strategic options.”
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> (Editor's note: This story has been updated to reflect that the firm was launched by Joe Scoby in 2012, not 2013.)
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Eric D. Schwerin
Rosemont Seneca Advisors, LLC
1010 Wisconsin Ave., NW
Suite 705
Washington, DC 20007
(202) 333-1880
[email-masked] <x-msg://59/[email-masked]>
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