Investors are pulling up to $900 million from Anthony Scaramucci's SkyBridge after rocky performance and a sell recommendation from Merrill LynchJuly 27, 2020
- About a quarter of SkyBridge Capital's investors asked to take their money out of the firm's flagship fund, which will translate to between $800 million and $900 million leaving, founder Anthony Scaramucci told Business Insider.
- After Merrill Lynch recommended investors leave the fund of funds in late June, SkyBridge lost about half of its Merrill Lynch assets, Scaramucci said.
- SkyBridge brought in $115 million in June from Japanese institutions and Middle Eastern family offices.
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About a quarter of investors in Anthony Scaramucci's flagship fund have asked for their money back in recent weeks, the SkyBridge Capital founder told Business Insider.
SkyBridge's fund of funds, which invests wealthy people's money into other hedge funds, was down 24.7% in March after a big debt bet, which led to significant redemptions in April and staff changes under its two portfolio managers. Credit-focused hedge funds took a big hit in March and were down 23.2% on average, according to Hedge Fund Research.
SkyBridge is still counting the latest round of redemption requests, which were due on Friday. Scaramucci said investors asked to pull out between $800 million and $900 million. He said the fund was up over 9% since April 1.
SkyBridge also saw some inflows in the second quarter, including about $115 million in June from Japanese institutions and family offices in the Middle East.
Scaramucci said SkyBridge should have about $7 billion in total assets under management after the redemptions.
After the fund's disastrous March performance and subsequent redemptions, SkyBridge sold some of its investments, including in EJF Capital and Hildene Capital Management, and invested in some of the industry's biggest funds: Canyon, Bridgewater, Point72, Renaissance, Brevan Howard, and Oaktree's Value Opportunities Fund.
Investors who asked for their money back will receive it by the end of September.
Read more: Here's how Anthony Scaramucci's SkyBridge offloaded stakes in 2 funds after credit markets seized up
Half of Merrill Lynch money walked
In April, Citigroup cut ties with the firm, which could lead to clients pulling $100 million from SkyBridge, The Wall Street Journal reported. That story also said Merrill Lynch had recently decided against making new investments in SkyBridge.
In late June, Merrill Lynch advised clients to sell the fund, leading Scaramucci to send a six-page letter to Merrill President Andy Sieg, Business Insider previously reported. SkyBridge will lose about half of its Merrill-linked assets through the latest redemption round, Scaramucci said.
"We have a lot of long-term investors," he said. "When you're with some of these wirehouses, they have a tendency to sell at the bottom."
Morgan Stanley recommended clients hold the fund but not sell it. Scaramucci said other firms had "buy" recommendations.
SkyBridge recently switched its redemption timeline for the fund of funds from quarterly to twice a year, so investors can next ask to take their money out in December.
Read more: Big-name credit funds like Canyon Partners, Angelo Gordon, and CQS got smacked in March, but some specialized credit investors are set to rake in cash as the chaos presents big opportunities
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