Hedge fund Citadel expects to return $7 billion in profits to clients – source

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(Reuters) – Hedge fund Citadel expects to return about $7 billion in profits to its investors in the first week of January after a stellar performance this year, a source familiar with the matter said.

Reuters reported this month that this year was shaping up to be one of Citadel’s best years in terms of performance. The hedge fund firm, which manages $59 billion in assets, told investors its flagship Wellington fund returned roughly 32% through the end of November.

Citadel, founded by billionaire investor Ken Griffin, did not immediately respond to a Reuters request for comment.

This is not the first time Citadel has returned money to its investors, but this will be the largest amount of profit returned in a single year. It has returned more than $11 billion in the last five years as it is more focused on performance, not on capital growth, the source said. The Wall Street Journal first reported the expected capital return earlier on Wednesday.

While fears of interest rate hikes and the Russia-Ukraine war weighed on capital markets throughout 2022, leaving the benchmark S&P 500 down about 20%, hedge funds have weathered the downturn better on average. Still, they are down 4.11%, according to data provider HFR.