Andor Capital: The Making of a Hedge Fund Run

Here is how it starts: A couple of things go slightly awry at a hedge fund. Perhaps a principal leaves, perhaps quarterly performance is slightly below that of peers — or of the market.

That precipitates a spate of stories in the trade press. Performance is worrisome! People are leaving!

Investors begin re-thinking what they once valued, and they start withdrawing their money. But in leveraged-up hedge funds, withdrawing a dollar can be like withdrawing two or three dollars, or more. Building up cash to handle redemption replaces strategic investments as topics for morning meetings, and performance falls further.

Unless there is an immediate turnabout in results, rumored wobbles at the hedge fund becomes a self-fulfilling prophecy, and the fund is in dire trouble.

Such, apparently, is what is going on at Andor Capital. While spokespeople deny that anything is awry, as they must, Barron’s says that the buzz is that the technology-loving Andor is having investor troubles. Put it this way: If there wasn’t trouble before, there will be now that Barron’s has people thinking about their Andor investments.

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Comments

  1. jonnhn says:

    is andor going belly up???????

  2. dan schmenton says:

    andor was built mostly because tech went up for most of the 90′s. and up ALOT. they have consistently been wrong on every major turn for the last 18-22 months. being very negative at bottom of oct/nov ’02. covering(panicking) into end of summer/early fall of ’03..then being long all way back into lows of april/may ’04. probably with huge redemptions and forced liquidation. they have to be so ”underwater”, they are “deer in headlights”.only good in straight line mkt.