John Corzine's New Hedge Fund Is Betting On Trump-Triggered Trades

It seems there are more greater fools than we imagined... about $300 million more...

 

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8 years after he took the helm at MF Global in March 2010 (imploding the firm the next year, leaving more than $1 billion of customer money missing, in the eighth-largest bankruptcy in U.S. history), Jon Corzine is back with a new hedge fund that’s betting the Trump administration will stir up markets.

As Bloomberg reports, the JDC-JSC Opportunity Fund, which bears the initials of Corzine’s late son Jeffrey and his own, will launch this quarter and aims to attract $100 million to $300 million in its first trading year, according to a person familiar with his thinking.

Corzine and former Taconic Capital Advisors investment director Richard Chappelear will share the chief investment officer role.

Corzine, 71, whose wide-ranging career includes serving as a U.S. senator and governor from New Jersey, is jumping into the hedge fund industry as it struggles to raise money.

His fund will make event-driven and macro trades on the expectation that President Donald Trump’s policies will trigger corporate actions and ripple through asset valuations, the person said.

Tax reform could spell stock-price divergence in sub-sectors of the small-cap Russell 2000 Index, spurring deals.

The fund will begin with event-driven trades and expand into macro investing -- trading interest rates, currencies and stocks -- when market volatility returns. Low volatility over the past few years has hindered the performance of most macro hedge funds.

Last year, Corzine paid $5 million of his own money to settle with regulators who accused him of failing to fix inadequate controls at MF Global.

He was banned from running or working for a futures broker or registering with the Commodity Futures Trading Commission, so his new fund can only invest a limited amount of client capital in futures.

Good luck investors...