How to Blast Your Hedge Fund Career on Bloomberg Chat
Neil Phillips was no newbie. He was not in dire need of money. After three years at Morgan Stanley in the early 2000s and nearly 19 years as a macro portfolio manager at hedge fund BlueBay Asset Management until 2014, Phillips couldn’t have done too badly at Glen Point Capital, the fund he founded in 2015. In 2017, he (as probably the highest paid partner) earned £17 million according to a filing with Companies House.
However, Phillips blew his career and is now arrested and charged with conspiring to manipulate the currency markets for a mere $20 million profit. He also made the rookie’s mistake discussing his seemingly nefarious intentions in a Bloomberg chat.
Details of Phillips’ alleged endeavors are contained in the indictment issued by the US court that led to his arrest in Spain earlier this week. Late Christmas evening and early morning Boxing Day 2017, Phillips allegedly sought to drive the dollar-rand exchange rate below 12.50 in an effort to raise $20 million from a one-touch barrier option that would pay off if the The rand is trading below 12.50 to 12.50 USD. dollars for even the shortest moment between October 30, 2017 and January 2, 2018. Matt Levine of Bloomberg calculates that Phillips may have paid $2 million for the option, which would pay absolutely nothing if the asking price was not reached.
After sitting on cucumbers for nearly two months without any joy, late on Christmas Eve when volumes were thin and the TV was poor, Phillips allegedly fancied his chances of forcing the rand higher against the dollar. Sitting in South Africa, he launched hundreds of millions of rand dollar trades early in the morning on Boxing Day, sending a Bloomberg chat message at 12.09 a.m. saying, “My goal is to trade up to 50,” followed by another message seven minutes later that I repeated. .
Given that Phillips unleashed his hundreds of millions just until he hit his goal and the trading volumes were sporadic, his activities might have been noticed even if it wasn’t for Bloomberg. But the general verdict from others in the market seems to be that even if you were to try something like that crap, there’s no way to document it on Bloomberg. Telegram is the place for such things. It is not clear what Phillips was thinking.
Phillips’ career has since collapsed. GlennPoint Capital bled employees earlier this year after the failed merger with Isler. Its people were popular at the time, but unfortunately – and although there is no implied indication that they were involved in Phillips activities – many of them have now been abandoned. Both Kirkoswald Capital and Balyasne have suspended or fired former Glen Point employees in recent days, according to the Financial Times.
Meanwhile, Phillips now faces a lawsuit and possibly a prison sentence. His fortunes had already taken a turn for the worse: in 2020, the highest-paid person at Glen Point earned just £3 million. He may want to start a GoFundMe to cover his defense costs; Unfortunately, his friends in the hedge fund community seem to be relatively few.
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