Jeff Feig, co-chief investment officer of hedge fund Fortress Investment Group LLC's macro fund, is leaving the company after less than a year, with Michael Novogratz becoming sole CIO, three sources with knowledge of the changes said.
This marks the second time in roughly six months that the $70 billion fund company, one of only a handful of publicly traded hedge fund firms, is making changes at its macro fund. The fund started the year with heavy losses after being wrong-footed on its Swiss franc trade.
Feig, 48, joined Fortress in September from Citigroup Inc , where he was a foreign exchange specialist. He joined as co-president of Fortress's Liquid Markets business and co-CIO of the Fortress macro fund with Novogratz, 50.
The sources said Fortress made the change to streamline the structure of running the fund and to capitalize on Novogratz's strong skills as a trader.
Feig's tenure has been rocky, with the losses on the Swiss franc move coming only a few months after he arrived, sources said. In January, Sherif Sweillam, chief risk officer, and Tye Schlegelmilch, a portfolio manager, resigned from the fund.
The current chief risk officer, Timothy Durnan, is staying on, the sources said.
Feig could not be reached immediately for comment.
The macro fund and related accounts had $2.8 billion in assets at the end of the first quarter, down from $3.2 billion at the start of the year. The fund itself, which has roughly $1.3 billion in assets, lost 7 percent, net of fees, during the first five months of 2015. June numbers have not yet been released.
The sources asked not to be identified because the funds are private and they were not authorized to speak publicly. Investors were informed of the moves by telephone over the weekend.
A spokesman for Fortress declined to comment.
Novogratz, a longtime Fortress executive and board member, is a former college wrestler known for his blunt market interpretations. He has worked with a number of people on managing the fund in the past.
Since 2009, when the macro fund was launched, his investment record has outpaced that of the entire fund, the sources said. Novogratz's managed-account investments related to the fund have delivered an average 9 percent per year since inception. The fund as a whole has gained only about 4 percent a year over that period.
Even though the fund has lost money this year, largely because of the Swiss franc blunder, it has made money on trading equities and interest rates, the sources said.
And while the macro fund is relatively small, Fortress expects it to grow, especially against a backdrop of currency market uncertainty related to Greece's debt problems.
It is also seen as a fund that can bolster the firm's bottom line. In 2013 the Liquid Markets business contributed 27 percent to distributable earnings, but that figure fell to only 5 percent last year when the macro fund lost 1.6 percent, while its peers gained 3.7 percent, according to Eurekahedge Macro Hedge Fund Index.
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