Big-name hedge funds investing in outside managers are turning to a proven pool of talent: Former Citadel PMs
Big-name hedge funds investing in outside managers are turning to a proven pool of talent: Former Citadel PMs
Bradley Saacks Mon, July 27, 2026 at 12:57 PM UTC
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Citadel founder Ken Griffin runs the most profitable hedge fund in history.Fabrice COFFRINI / AFP via Getty Images -
Hedge funds have been increasingly investing in externally run firms to deal with the high cost of talent.
Funds have been putting their money into the hands of traders who once worked for Ken Griffin's Citadel.
Managers such as Millennium, Schonfeld, Walleye, Verition, Squarepoint, and more have invested in Citadel spin-outs.
The biggest trend in the hedge-fund industry is that the hunt for top traders and investment ideas has expanded beyond firms' four walls.
The ongoing war for talent and fast-moving markets has the industry's biggest managers investing in externally run funds and paying outside firms for their ideas, Business Insider has reported. The goal of this outward push is the same as every fund's main objective: To find market-beating returns wherever they exist.
A review of data gathered from institutional investor data provider Old Well Labs, regulatory filings, media reports, and industry sources shows that these funds are putting their money into a proven pool of talent: firms run by former Citadel portfolio managers.
At least 12 funds run by onetime Citadel traders have backing from the multistrategy peer set of Ken Griffin's firm, Business Insider's review of the data shows. Managers such as Millennium, Schonfeld, Verition, Qube, and more have put capital into these funds.
In one sense, it's expected. Multistrategy managers don't abandon their strict risk-taking standards just because they are putting money to work externally. The managers run by former Citadel PMs are stockpickers who often trade in a market-neutral style, meaning they hedge their bets to protect against possible market moves against their ideas.
That style of investing is the most popular with allocators right now, according to Nasdaq's eVestment. A recent report from the data tracker found that allocators put more than $30 billion of net new money into market-neutral equity funds in the first quarter alone.
Story continues below the table.
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Name
Firm
Backer
Citadel end date
Firm start date
Sean Murphy
Jerpoint
Qube
2024
2025
Tommaso Trento
Benchstone
Schonfeld, Walleye
2022
2023
Soren Gandrud
Jones Hill
Walleye
2021
2026
Niall O'Keefe, Tio Charbaghi
Squarepoint, Walleye
2018, 2020
2021
Chris Connor
Ardmore Road
Qube, Squarepoint, Verition, Walleye
2020
2020
Khalid Malik
Meridiem
Schonfeld
2020
2021
Brandon Wier
Squarepoint
2018
2020
Mark Schlueter
Sagefield
Squarepoint
2017
2019
Brian Kuzma
Thomist
Walleye
2017
2018
Joshua White
Regents Gate
SummitTX
2016
2024
Peter Seuss
Prana
Schonfeld
2016
2017
Dan Johnson
Gillson
Qube, Schonfeld
2014
2015
While Citadel is far from the only multistrategy fund to spawn a network of spin-offs, Business Insider's review of external investments found that alums of the Miami-based manager — relative to the firm's peers — were a favorite for SMA investors.
Millennium, the most prolific external investor among the multistrategy firms, has backed funds run by former Citadel PMs. Stock-picking Kodai Capital, run by onetime Citadel PM Neville Shah, managed money for Millennium; Kodai returned capital to its backers in 2025, and Shah now works internally at Millennium. The firm also redeemed its money from Khalid Malik's Meridiem Capital, which Schonfeld is currently invested in.
Izzy Englander's firm is set to back former Citadel quant Paul Dou, who left Griffin's fund in 2024, for the launch of Third Epsilon in Hong Kong.
Not all external investments are the same. Some funds launch primarily with SMA capital from large platforms, while others use this increasingly prominent source of money to grow their overall asset base.
At London-based FIFTHDELTA, run by former Citadel PMs Niall O'Keefe and Tio Charbaghi, the SMA capital the firm has from backers such as Squarepoint and Walleye is on the same terms as the firm's original investors in its more traditional commingled fund, a representative for the firm told Business Insider.
"This approach ensures full alignment of interests and equitable treatment across our entire investor base," the representative said in a statement.
Other funds and founders mentioned declined to comment or did not respond to requests for comment.
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Source: “AOL Money”
