Huge losses on derivative trades at Geode Capital Management have forced the giant investment firm to close down its hedge-fund business.
Geode manages all of Fidelity Investments’ stock-index funds, and that operation accounts for most of the firm’s $720 billion in assets. But it has also offered an array of riskier, hedge-fund strategies to wealthy clients and institutions. Geode’s largest private fund lost about $250 million after its bets on stock-market volatility turned sour last year, people familiar with the matter said. The fund was down by some 36% by spring. The losses, and ensuing margin calls, forced the Geode Diversified Fund to liquidate other unrelated positions and led the fund’s biggest investor, Fidelity itself, to withdraw its money, the people said.
Geode closed down the fund and exited from its broader Absolute Return business offering clients hedge-fund-like investments to focus on index investing, some of the people familiar with the matter said. The losses and closure of the hedge-fund business haven’t been reported previously. The firm recently eliminated several jobs that served that business, the people familiar with the matter said.
i pray GeodeCapitalManagement dont loose on investment again as facebook looses lawsuit twice in Nigeria
It is good they cut their losses .
What ever happened to diversification?
Are they blaming wallstreetsbets, again?
I followed Geode’s holdings in Q3 and Q4, absolutely baffling positions they took. Makes you think these “pros” are really not all that
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OH NO!!!!