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Monday, May 25, 2020

Tremont Founder Down on Hedge Funds


Date: Tuesday, November 25, 2008
Author: Paula Schaap, reporter, HedgeFund.net

The founder of asset manger Tremont Capital Management sent an angry email to fellow investors, asking them to join a union to reform the hedge fund industry.

Sandra Manzke, who founded Tremont in 1985, and now heads up Connecticut-based MAXAM Capital Management, wrote to about 500 individuals and firms, “While we all recognize the difficulties of the current market environment, I am appalled and disgusted by the activities of a number of hedge fund managers.”

Manzke wrote that she was particularly angered by the increased use of strategies such as redemption suspensions, gating and liquidations, when they favored hedge fund management at the expense of investors.

“What I don’t understand is hedge fund managers with a lot of cash suspending redemptions or raising gates,” she told CNBC Monday.

She also hit out at management fees, which she said were “outrageous” and “lucrative wages” for employees with investors bearing the costs, “unjustified by mounting losses.”

In her e-mail, Manzke called for the formation of a “Hedge Fund Investors United Forum” to push for industry-wide reform.