ExodusPoint's lessons for Jain Global: Multistrategy hedge funds mature with time
It wasn't so long ago that ExodusPoint, the fund founded in 2018 by Michael Gelband, was the limping dog of the multistrategy hedge fund world. Times, however, have changed.
Get Morning Coffee ☕ in your inbox. Sign up here.
Last year, Bloomberg reported that ExodusPoint generated returns of 18.4%. In so doing, ExodusPoint outperformed both Citadel's Wellington Fund (10.2%) and Millennium (10.5%), where Gelband was previously head of the fixed income division. It also generated returns five times higher than the 3.7% reportedly generated by Jain Global, the fund founded by Bobby Jain, Gelband's former colleague and Millennium's ex-co-chief investment officer.
As Jain Global battles redemption requests and Substack posts questioning the wisdom of its 50 different pods, Gelband's ExodusPoint is a reminder that multistrategy hedge funds can take time to get going.
Similarities between Jain and ExodusPoint extend beyond their founders' time at Millennium. Both firms were initially celebrated as major hedge fund launches: ExodusPoint launched with $8bn, Jain with $5.3bn. Both seemed to falter. During its first half year of operation, ExodusPoint generated returns of 0.57%, only slightly higher than Jain's 0.5%. In 2022, ExodusPoint suffered $400m+ of redemptions, followed by another $1bn in the first half of 2024. But now look.
ExodusPoint's redemptive arc is also a reminder, however, that the going is not always smooth. The fund cut 25% of its portfolio managers in late 2022. going from 108 to 81 people. It's resisted big hiring ever since. Business Insider reported last June that ExodusPoint had held its headcount steady at 650 people after slimming down from 688 people in 2022. While multistrategy hedge funds as a whole increased headcount by 64% over that period according to Goldman Sachs, ExodusPoint sat on the sidelines.
Does this mean that Jain Global will also need to cull some of its 400 employees to thrive? Not necessarily. Jain and ExodusPoint come with important differences. ExodusPoint, for example, told Business Insider that 75% of its risk is invested in fixed income funds, and that this has helped juice its returns in recent years. By comparison, Jain Global has set out to build a more diversified business covering all asset classes, including commodities. This should leave it better placed to ride out varying market conditions.
Jain Global has also invested heavily in the sort of centralized and scalable infrastructure platform that contributes to high costs in the short term but that pays off when assets under management (AUM) grow. All that's needed is a bit of momentum. As Jain gets out of toddler phase, this is what it needs most of all in 2026.
Have a confidential story, tip, or comment you’d like to share? Contact: +44 7537 182250 (SMS, Whatsapp or voicemail). Telegram: @SarahButcher. Signal: sarahbutcher.22 Click here to fill in our anonymous form, or email editortips@efinancialcareers.com.
Bear with us if you leave a comment at the bottom of this article: comments are moderated intermittently by human beings. Sometimes these humans might be asleep, or away from their desks, so it may take a while for your comment to appear. You must take sole responsibility for comments you post on this site. We will take reasonable steps to weed out anything that we consider to be offensive or inappropriate.
