(Adds details on performance)
By Svea Herbst-Bayliss and Nishant Kumar
BOSTON/LONDON, July 6 Jeff Feig, co-chief
investment officer of hedge fund Fortress Investment Group LLC's
macro fund, is leaving the company after less than a
year, with Michael Novogratz becoming sole CIO, three sources
with knowledge of the changes said.
This marks the second time in roughly six months that the
$70 billion fund company, one of only a handful of publicly
traded hedge fund firms, is making changes at its macro fund.
The fund started the year with heavy losses after being
wrong-footed on its Swiss franc trade.
Feig, 48, joined Fortress in September from Citigroup Inc
, where he was a foreign exchange specialist. He joined as
co-president of Fortress's Liquid Markets business and co-CIO of
the Fortress macro fund with Novogratz, 50.
The sources said Fortress made the change to streamline the
structure of running the fund and to capitalize on Novogratz's
strong skills as a trader.
Feig's tenure has been rocky, with the losses on the Swiss
franc move coming only a few months after he arrived, sources
said. In January, Sherif Sweillam, chief risk officer, and Tye
Schlegelmilch, a portfolio manager, resigned from the fund.
The current chief risk officer, Timothy Durnan, is staying
on, the sources said.
Feig could not be reached immediately for comment.
The macro fund and related accounts had $2.8 billion in
assets at the end of the first quarter, down from $3.2 billion
at the start of the year. The fund itself, which has roughly
$1.3 billion in assets, lost 7 percent, net of fees, during the
first five months of 2015. June numbers have not yet been
The sources asked not to be identified because the funds are
private and they were not authorized to speak publicly.
Investors were informed of the moves by telephone over the
A spokesman for Fortress declined to comment.
Novogratz, a longtime Fortress executive and board member,
is a former college wrestler known for his blunt market
interpretations. He has worked with a number of people on
managing the fund in the past.
Since 2009, when the macro fund was launched, his investment
record has outpaced that of the entire fund, the sources said.
Novogratz's managed-account investments related to the fund have
delivered an average 9 percent per year since inception. The
fund as a whole has gained only about 4 percent a year over that
Even though the fund has lost money this year, largely
because of the Swiss franc blunder, it has made money on trading
equities and interest rates, the sources said.
And while the macro fund is relatively small, Fortress
expects it to grow, especially against a backdrop of currency
market uncertainty related to Greece's debt problems.
It is also seen as a fund that can bolster the firm's bottom
line. In 2013 the Liquid Markets business contributed 27 percent
to distributable earnings, but that figure fell to only 5
percent last year when the macro fund lost 1.6 percent, while
its peers gained 3.7 percent, according to Eurekahedge Macro
Hedge Fund Index.
(Reporting by Svea Herbst-Bayliss in Boston and Nishant Kumar
in London; Editing by Jeffrey Benkoe; and Peter Galloway)