Nearly $4 billion hedge fund Carronade will stop accepting new clients
Hedge fund Carronade Capital Management will stop taking on new investors at the end of this year after reaching $3.7 billion in assets under management. According to a letter to investors, the hedge fund said that its current management scale has reached about 60% of its long-term capacity and that starting in 2027 it will only accept additional funds from existing clients. According to people familiar with the matter, the multi-strategy fund founded by Dan Gropper in July 2020 has generated annualized returns of approximately 10.5% since its inception. Gropper said in the letter that the move would leave room for the fund's natural growth, retain investment capacity from existing partners and minimize the need to return funds in the future. "Our primary goal is to maximize long-term investment performance, not to expand the size of our assets under management," he said. As investors continue to increase their allocations to hedge funds, more and more hedge funds are beginning to stop accepting new funds or new clients. Last year, the hedge fund industry saw net inflows of $116 billion, the highest level since 2007. Carronade returned 7.6% in the first half of this year, compared with the average multi-strategy credit hedge fund return of 4.7% during the same period, according to research firm PivotalPath. Gropper declined to comment.