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Friday, 18 April 2008
Amanda Gome
You can’t go past running your own hedge fund. At least that’s what Australian hedge fund manager Greg Coffey is thinking.
The Australian reports today that he has surged into the ranks of the super rich, collecting $320 million in fees last year. Not satisfied with that, the 36-year-old apparently resigned at the weekend to set up his own fund, but his boss GLG Partners is not happy with that and is trying to woo him back.
So what exactly did Coffey do to earn this extraordinary amount of money? Cure for cancer? Great new innovation to make life easier, better, cheaper, cleaner for millions? Come up with the next internet?? Nope.
He and other hedge fund managers in London have shared an extraordinary payout of more than $US2 billion by betting on the fall of the US sub-prime mortgage market, selling shares before the downturn and buying them back at a lower price.
Maybe the day of reckoning is coming. Some hedge funds are on the nose, allegedly for colluding to drive down the price of stocks.
But for entrepreneurs who are suffering the effects of the credit squeeze and the market fall, those exorbitant salaries for paper-shuffling young bucks is just a bit rich.
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