This is part of a special report on SAC Capital Advisors,
LP that can be seen here:
Feb 23 In the 19 years since Steven A. Cohen
used about $25 million to start his own hedge fund, SAC Capital
Advisors has grown into a $13 billion behemoth, one of the
industry's biggest and most powerful. Cohen, known for pushing
his staff hard, is equally tough on himself. He puts in long
hours on his 20,000-square-foot trading floor, which is cooled
to around 69 degrees to keep employees wide awake, wooing
potential investors over a round of golf or intimate dinners,
and reviewing many job applications personally.
Here is a list of little-known facts about Cohen's
* Cohen located his Disaster Recovery data center in the
village of Wappinger Falls, population 5,000, roughly 65 miles
(105 km) northwest of the firm's Stamford, Connecticut
headquarters. To make sure no data, including email, is ever
lost, the site is on a different power grid from the Stamford
and New York sites and has an uninterrupted power supply with
an emergency generator.
* Sticking with the idea of not having all his eggs in one
basket, Cohen uses five prime brokers -- Goldman Sachs, Morgan
Stanley, Credit Suisse, JPMorgan and Barclay's Bank -- more
than the two or three prime brokers most other fund firms use.
* PricewaterhouseCoopers LLP has combed through the books
of SAC funds since 1994 as the firm's official auditor.
* SAC manages over seven dozen portfolios with SAC Capital
Associates being both the oldest continuously active portfolio
and its largest current portfolio, the firm said in 2009.
* While SAC stands for its founders initials, the man
doesn't work alone. In his seven offices around the world, he
employs over 90 portfolio managers, 130 research analysts, more
than 30 trading execution specialists and more than 30 people
in compliance and due diligence.
* Like other hedge fund firms, SAC incorporates its
offshore funds on tropical islands with five organized in the
Cayman Islands, where the bulk of the world's hedge funds are
located. But SAC also located eight portfolios in Anguilla,
where fees are generally lower.
* While Cohen himself may be eager to save where he can,
he's not bashful about making his clients pay some of the
highest fees in the hedge fund industry that investors say
amount to a roughly 3 percent management fee and a roughly 50
percent performance fee. Several investors said they "hate" the
high fees but are sticking with him for now.
* Just in case something should go wrong, SAC says it has
investment advisor/investment fund management and professional
liability insurance with coverage of about $30 million.
* The firm says that its funds employ "significant
leverage" which allows them to magnify their exposure and lists
a ratio of 3-4 to 1 for funds pursuing long/short equities
strategies. The S.A.C. Select Fund, LLC (long/short equities
with lower net exposure) employs leverage of 5 to 1 and
quantitative equities use leverage of 8 to 1.
* Over the years, Cohen has attracted hundreds of wealthy
clients as well as powerful institutional investors such as the
Blackstone Group's fund of funds unit, whose investments can
often bestow a sort of seal of good housekeeping on a firm.
Others investors include Hatteras Funds, and Infinity Capital
* When he's not working, Cohen can relax at his
36,000-square-foot home, shooting hoops on his basketball
court, swimming in an indoor pool, or turning figure eights on
an ice skating rink.
Sources: SAC marketing information and due diligence
(Reporting by Svea Herbst-Bayliss and Matthew Goldstein;
Editing by Claudia Parsons and Jim Impoco)