Tags: trader | Brevan Howard | hedge fund | lawsuit

Trader Lost $383 Million for Brevan Howard Fund in 2012

Tuesday, 26 Aug 2014 01:51 PM

Chris Rokos, a former top trader at Brevan Howard Asset Management LLP, lost $383 million for the firm’s main hedge fund in 2012, the year he resigned, after his profits contributed 30 percent of its returns the year before, he said in court documents.

It was the second year that he lost money for the Brevan Howard Master Fund, according to documents filed in Jersey, Channel Islands on Aug. 22 that were made public today. After losing $12 million in 2010, Rokos, 43, earned $1.27 billion the following year for the fund, which was still profitable in all three years.

Rokos is suing the company he helped found to void an agreement that restricts him from managing outside investors’ money until 2018 in order to start his own investment fund. Brevan Howard, Europe’s second-largest hedge-fund firm with $37 billion in assets, countersued to block him from doing so.

Rokos retired from the firm in June 2012, according to court filings, and continued to wind down his trading book until September of that year. He earned about $900 million for himself after the firm was established in 2002.

Rokos said in the document, a reply to Brevan Howard’s counterclaim, that he “was a very successful trader and it is averred that he was a very successful trader” before he joined Brevan Howard. Only Alan Howard, the firm’s chief, managed more money than Rokos, according to the documents.

Profit Allocations

Rokos is also asking the court in Jersey, the U.K. offshore dependency, to rule that he should still get profit allocations until 2018, even if the restrictions are lifted. The company paid him $73 million earlier this year.

The Master Fund, established in 2003, had more than $5 billion in assets by the end of 2004. That grew to about $28 billion as of October 2013, the firm said in court papers. Rokos’s role with the fund gave him “direct access to an ongoing contact with the limited pool of investors and potential investors prepared to make substantial investments through a hedge fund,” the firm said.

Rokos made about $4 billion for the fund from 2004 to 2012, according to calculations by Bloomberg News based on figures in the filing. That includes $1.11 billion in 2007, which accounted for 27 percent of the fund’s profits that year, as well as $549 million in 2008 and $933 million in 2009.

Rokos also contributed as much as 57 percent of profit to the firm’s Strategic Opportunities fund, with $49 million in 2008, according to his filing.

Anthony Payne, a spokesman for Brevan Howard in London, declined to comment on the money Rokos earned for the firm. Alan Kilkenny, a spokesman for Rokos, also declined to comment.

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Chris Rokos, a former top trader at Brevan Howard Asset Management LLP, lost $383 million for the firm's main hedge fund in 2012, the year he resigned, after his profits contributed 30 percent of its returns the year before, he said in court documents.
trader, Brevan Howard, hedge fund, lawsuit
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2014-51-26
Tuesday, 26 Aug 2014 01:51 PM
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