Hedge Funds

Citadel suspends redemptions from two hedge funds

Kenneth Griffin (R), Founder, President and CEO, Citadel Investment Group is shown in this file photo. REUTERS/Phil McCarten

CHICAGO (Reuters) - Citadel, a sizable U.S. hedge fund, said on Saturday it has halted redemptions from its two largest funds until at least March.

The suspension affects the Kensington and Wellington funds.

The decision was “driven by continued volatility in the market,” Citadel spokeswoman Katie Spring told Reuters in an e-mail.

The move was announced in a letter sent to investors on Friday by Citadel’s founder and president, Ken Griffin, and reported by Crain’s Chicago Business.

“We recognize how a suspension impacts our investors, especially those with current financial obligations of their own to meet,” Griffin wrote.

Chicago-based Citadel managed about $18 billion (12 billion pounds) in assets as of early November. It has recorded annual gains every year since it was started in 1990.

Citadel lost around 13 percent in November, pushing its year-to-date losses to about 47 percent, Reuters reported on December 4, citing investors.

Spring said Citadel has absorbed a “substantial portion of this year’s management fees.”

Dozens of prominent hedge funds have recently restricted redemptions in some of their portfolios. In the past, hedge fund managers had rarely restricted their clients’ exits.

Reporting by Ros Krasny; Editing by John O’Callaghan