The hedge fund Highbridge Capital Management just lured away two portfolio managers from Steven A. Cohen’s SAC Capital Advisors to manage money for its stock trading funds.
The firm, with $29 billion in management, recently hired Wayne Chambless and Christopher Procaccini from SAC, said two people briefed on the matter. Mr. Chambless and Mr. Procaccini are leaving SAC a month before the firm officially changes its name to Point72 Asset Management and converts from a hedge fund to a family office that will manage mainly Mr. Cohen’s $9 billion.
Over the last several months, SAC, which once employed nearly 1,000 people, has been slowly shedding staff through a combination of layoffs, office closings and traders jumping to other shops. The firm, in announcing the name change, said it had roughly 850 employees and did not see itself shrinking much more.
But people in the hedge fund industry said the expectation was that a number of top money managers at SAC would begin looking for jobs outside the firm after their employment contracts expired. These people said it should become easier for traders and analysts to look for jobs outside SAC as the insider trading scandal that has besieged the firm became less in the public eye.
On April 10, Judge Laura Taylor Swain of the United States District Court in Manhattan is scheduled to either approve or reject SAC’s guilty plea to securities fraud charges arising from the federal government’s nearly 10-year insider trading investigation of Mr. Cohen’s firm. As part of the plea, SAC agreed to pay a $1.2 billion penalty and stop managing money for outside investors.
In picking up Mr. Chambless and Mr. Procaccini, Highbridge is getting two traders who collectively managed $800 million to $1 billion of SAC’s money. Mr. Chambless specializes in shorting or betting against stocks and previously worked for Jim Chanos’s firm, Kynikos Associates. Mr. Procaccini mainly traded health care stocks and previously worked for Och-Ziff Capital Management. The two men, both of whom were well regarded within SAC, were recruited separately by Highbridge, said the people briefed on the matter but not authorized to discuss it publicly. Highbridge declined to comment on the matter.
Highbridge, which is owned by JPMorgan Chase, is one of the world’s largest hedge fund firms. The firm also manages several private equity funds. Last year, there was a changing of the guard at Highbridge when a co-founder, Glenn Dubin, stepped down as chief executive and was succeeded by Scott Kapnick, a former Goldman Sachs investment banker, who joined the firm in 2007.
Highbridge joins a growing list of well-known hedge funds that have hired traders and analysts from SAC despite the trading scandal. Other hedge funds that been picking up people from SAC include BlueCrest Capital Management, Moore Capital Management and Balyasny Asset Management.
“Turnover is part of the natural ebb and flow of SAC’s business,” said Jonathan Gasthalter, an SAC spokesman. “SAC remains well within its historical normal levels of voluntary turnover.”