Millennium withdraws $1.5bn from external hedge funds following losses

Millennium, a $95 billion-plus hedge fund founded by Izzy Englander, has removed more than $1.5 billion in leveraged capital from two external hedge funds due to investment losses. Troluce Capital Advisors and Axebrook Capital, both of which were established by Izzy Englander and Jack Land respectively, saw withdrawals of over $1 billion and $500 million respectively.

Despite the pullbacks, both Troluce and Axebrook are expected to continue their operations. Troluce has also recently broadened its trading activities beyond its primary hedge fund strategy. Millennium has been increasing its allocation of capital to external managers as part of its investment model, with hundreds of its over 370 investment teams operating independently.

However, these arrangements expose smaller hedge funds to rigorous risk limits and the risk of sudden withdrawals following underperformance. The move comes as multistrategy hedge funds face increasing scrutiny over leverage, risk management, and capital allocation among their investment teams. Millennium has remained relatively stable amid recent market fluctuations, earning an 8.1% gain through September, with performance largely stagnant during the month.