Tiger Management
Encyclopedia
Tiger Management Corp., also known as "The Tiger Fund," was a hedge fund
founded by Julian Robertson
. The fund began investing in 1980 and was closed in March 2000.
and former United States Navy
officer
, started Tiger Management in 1980 with $8 million in capital. By 1996, the fund’s assets had increased to $7.2 billion in value.
On April 1, 1996 BusinessWeek
carried a cover story
written by reporter Gary Weiss
, called "Fall of the Wizard", that was critical of Robertson's performance and behavior as founder and manager of Tiger Management. Robertson subsequently sued Weiss and BusinessWeek for $1 billion for defamation. The suit was settled with no money changing hands and BusinessWeek standing by the substance of its reporting.
With $10.5 billion of assets under management
in 1997, it was the second largest hedge fund in the world at the time. Its holdings climbed to $22 billion in 1998.
Tiger's largest equity holding at that time was U.S. Airways, whose troubles dragged down the value of his holdings. Such missteps ultimately led him to close his investment company in March 2000 and return all outside capital to investors. Tiger earlier made $2 bn in gains, but then it gave most of them back during a huge one-day move in the yen in 1998. In September 2001, Robertson distributed 24.8 million greatly devalued U.S. Airways shares over to former investors in Tiger. Robertson declared his intent to keep the stock. U.S. Airways declared bankruptcy in 2002, and shareholders in the airline were wiped out.
, Stephen Mandel
, John Griffin, David Gerstenhaber (video portrait) and Paul Touradji.
"The modern-day emergence of hedge funds can be attributed to a 1986 article in the Institutional Investor
highlighting the extraordinary returns of the Tiger Fund. The article spurred investor interest and financing; since that time, hedge funds have increasingly attracted investment and human capital."
The Wall Street Journal reported in June 2010 that Robertson is considering reopening his firm to outside investors. John Townsend, a former partner at Goldman Sachs
, has been hired as the Chief Operating Officer, and Robertson's son Alex has also joined the firm. The new hires were part of a potential expansion that could involve creating a "seeding" fund or a fund of hedge funds for outside investors. According to Institutional Investor magazine, the timing may not be optimal, because this year many of the Tiger-seeded funds are struggling.
Hedge fund
A hedge fund is a private pool of capital actively managed by an investment adviser. Hedge funds are only open for investment to a limited number of accredited or qualified investors who meet criteria set by regulators. These investors can be institutions, such as pension funds, university...
founded by Julian Robertson
Julian Robertson
Julian H. Robertson Jr., KNZM is an American former hedge fund manager. Now retired, Robertson invests directly in other hedge funds, most run by former employees of Robertson's defunct hedge fund company....
. The fund began investing in 1980 and was closed in March 2000.
History
Julian Robertson, a stock brokerStock broker
A stock broker or stockbroker is a regulated professional broker who buys and sells shares and other securities through market makers or Agency Only Firms on behalf of investors...
and former United States Navy
United States Navy
The United States Navy is the naval warfare service branch of the United States Armed Forces and one of the seven uniformed services of the United States. The U.S. Navy is the largest in the world; its battle fleet tonnage is greater than that of the next 13 largest navies combined. The U.S...
officer
Officer (armed forces)
An officer is a member of an armed force or uniformed service who holds a position of authority. Commissioned officers derive authority directly from a sovereign power and, as such, hold a commission charging them with the duties and responsibilities of a specific office or position...
, started Tiger Management in 1980 with $8 million in capital. By 1996, the fund’s assets had increased to $7.2 billion in value.
On April 1, 1996 BusinessWeek
BusinessWeek
Bloomberg Businessweek, commonly and formerly known as BusinessWeek, is a weekly business magazine published by Bloomberg L.P. It is currently headquartered in New York City.- History :...
carried a cover story
Cover story
Cover story may refer to:* a story in a magazine whose subject matter appears on its front cover* a fictitious account that is intended to hide one's real motive, e.g. when a terrorist pretends to be farmer to buy fertilizer or to provide an explanation in case it is found; the story in the case of...
written by reporter Gary Weiss
Gary Weiss
Gary Weiss is an American investigative journalist, columnist and author of two books that critically examine the ethics and morality of Wall Street...
, called "Fall of the Wizard", that was critical of Robertson's performance and behavior as founder and manager of Tiger Management. Robertson subsequently sued Weiss and BusinessWeek for $1 billion for defamation. The suit was settled with no money changing hands and BusinessWeek standing by the substance of its reporting.
With $10.5 billion of assets under management
Assets under management
Assets under management is a financial term used denote the market value of funds being managed by a financial instutition on behalf of its clients, investors, depositors, etc. This metric is a sign of size and success against competition...
in 1997, it was the second largest hedge fund in the world at the time. Its holdings climbed to $22 billion in 1998.
Tiger's largest equity holding at that time was U.S. Airways, whose troubles dragged down the value of his holdings. Such missteps ultimately led him to close his investment company in March 2000 and return all outside capital to investors. Tiger earlier made $2 bn in gains, but then it gave most of them back during a huge one-day move in the yen in 1998. In September 2001, Robertson distributed 24.8 million greatly devalued U.S. Airways shares over to former investors in Tiger. Robertson declared his intent to keep the stock. U.S. Airways declared bankruptcy in 2002, and shareholders in the airline were wiped out.
Aftermath and legacy
After closing his Tiger Fund in 2000, Robertson started to use his own capital, experience, and infrastructure to support and finance ("seed") upcoming hedge fund managers. As of September 2009, Robertson has helped launching 38 hedge funds ("Tiger Seeds") in return for a stake in their fund management companies. Apart from those Tiger Seeds, a considerable number of analysts and managers Robertson employed and mentored at Tiger Management went out on their own and are now running some of the best-known hedge fund firms, called "Tiger Cubs", run by Tiger alumni such as Lee AinslieLee Ainslie
Lee S. Ainslie III is the head of hedge fund Maverick Capital, which in 1993 he helped form at the invitation of billionaire Sam Wyly. Prior to joining Maverick, he worked at Julian Robertson's Tiger Management Corp. He holds a bachelor's degree from the University of Virginia and an MBA from the...
, Stephen Mandel
Stephen Mandel (hedge fund manager)
Stephen F. Mandel Jr. is the founder of hedge fund Lone Pine Capital. Prior to founding Lone Pine Capital, he worked at Tiger Management. Mandel was a consumer retail analyst at Goldman, Sachs & Co. in the 1980s. He worked at Mars & Co as a senior consultant in the early 1980s.He is a 1978...
, John Griffin, David Gerstenhaber (video portrait) and Paul Touradji.
"The modern-day emergence of hedge funds can be attributed to a 1986 article in the Institutional Investor
Institutional Investor (magazine)
Institutional Investor magazine is a monthly periodical published by Euromoney Institutional Investor. A separate international edition of the magazine was established in 1976 for readers in Europe and Asia. Capital Cities Communications purchased the magazine in 1984...
highlighting the extraordinary returns of the Tiger Fund. The article spurred investor interest and financing; since that time, hedge funds have increasingly attracted investment and human capital."
The Wall Street Journal reported in June 2010 that Robertson is considering reopening his firm to outside investors. John Townsend, a former partner at Goldman Sachs
Goldman Sachs
The Goldman Sachs Group, Inc. is an American multinational bulge bracket investment banking and securities firm that engages in global investment banking, securities, investment management, and other financial services primarily with institutional clients...
, has been hired as the Chief Operating Officer, and Robertson's son Alex has also joined the firm. The new hires were part of a potential expansion that could involve creating a "seeding" fund or a fund of hedge funds for outside investors. According to Institutional Investor magazine, the timing may not be optimal, because this year many of the Tiger-seeded funds are struggling.