(Bloomberg) - Izzy Englander’s Millennium Management plans to return a record $15 billion to investors at year-end, a big step toward creating a more stable capital base.
As it has done since 2018, Millennium will return money to clients from a share class that can be redeemed in full over a year, according to investors. The amount it’s sending back now is so big that it exceeds the assets of most hedge funds operating today.
At the same time, the firm is raising about $10 billion for a longer-term share class that extends the full redemption period to five years. Investors whose money is returned can choose to reinvest it in the longer-term structure.
The $10 billion will lift the longer-term capital to about three-quarters of Millennium’s total assets, including roughly $8 billion that belongs to Englander and employees.
The firm has been exploring ways to lock up cash for longer during the past decade, and three years ago it extended the period over which clients can redeem their money. Millennium executives see more stable capital as a lure for attracting and retaining investment professionals as well as giving the business leeway to make internal investments, such as technology upgrades.
A spokesman for New York-based Millennium declined to comment.
The flagship hedge fund climbed 10.9% this year through October. Its steady returns over the firm’s three-decade history make the newer share class an easier sell than at competitors.
Once Millennium calls the pledged capital -- which can be called over three years -- clients will be able to withdraw only 5% of their money each quarter, meaning it would take five years to cash out completely.
The firm raised $7 billion at the beginning of October, according to investors, who said an additional $3 billion is expected on Jan. 1. Last year, Millennium raised $6 billion in longer-term cash.
By Katherine Burton
