BOSTON (Reuters) - Activist hedge fund Barington Capital has hired a new executive to spearhead marketing and investor relations at a time when the fund is putting up strong numbers but as investors’ taste for portfolio managers who push for corporate change has ebbed.
Brian Moss joined the New York-based hedge fund as a partner earlier this month after spending the last 10 years at Optima Fund Management, which offers institutional and high net-worth investors access to hedge funds. The hiring was confirmed by Barington’s chief operating officer, Jared Landaw, on Wednesday.
At Barington, Moss replaces Marjorie Kaufman, who remains a partner at the firm but has shifted her focus to a research initiative centered around improving public company corporate governance.
Raising money for hedge funds has been a tough sell this year as many institutional investors, including state pension funds in New Jersey, New York and Illinois, have rethought their commitments in light of funds’ low returns and high fees.
Investors pulled $34 billion out of hedge funds in the first half of 2016 after having added $76 billion in the first six months of 2015, research firm Preqin said last week.
They were especially disappointed with activists; every surveyed client said the strategy had fallen short of expectations, Preqin said. Blackstone Group LP, the world’s biggest investor in hedge funds, for example, pulled out the money its Blackstone Alternative Alpha Master Fund had put into activist firm JANA Partners’ JANA Nirvana fund, according to a recent filing.
The outlook for the second half is not much better, with only 5 percent of those surveyed by Preqin saying they planned to add new money even though recent return data shows improvement.
At Barington, 2016 has been particularly strong, with its top three holdings - beauty company Avon Products Inc, information technology firm Ebix Inc and retailer Chico’s FAS Inc - showing strong stock gains. Barington had pushed for Chico’s to cut costs, boost revenue and buy back more shares but dropped its proxy fight against the company last month after two advisory firms said the chief executive should have more time to make changes.
The hedge fund has gained roughly 13 percent this year through late August, said an investor in the fund who is not authorized to discuss performance publicly.
Reporting by Svea Herbst-Bayliss; Editing by Matthew Lewis