D1 shutting down?

Guess maybe not surprising given what's going on but heard D1 is closing, anyone hear anything similar?

Comments (39)

  • Analyst 2 in IB - Gen
Jun 24, 2022 - 4:47pm

If true then we might be in for a wild summer -- three blue chip funds that were considered top hedge fund seats (whale rock, D1, melvin) have already thrown in the towel, and if D1 is fucked, any one of the techy L/S funds could be next. Tiger Global, Skye Global, Dragoneer, Altimeter, Abdiel, Addition, Coatue all down a ton already (tbh pretty much every equity hedge fund besides the MMs are).  Crazy how quickly a coveted analyst job can be pulled out from underneath you -- I don't think a lot of younger folks that started careers post financial crisis have really appreciated the volatility of the hedge fund industry during the last decade's bull run but it's becoming very apparent now. 

  • Analyst 2 in IB - Gen
Jun 25, 2022 - 1:47pm

Yes but a bunch of the crossover funds aren't marking down their private investments -- their true portfolio value is down significantly more than they're reporting. Where they get into trouble is when they do exactly what D1 did which is using their private investments as collateral for leverage in their public books which then forces them to mark private investments to market leading to a margin call when everything goes to shit at once (which is what II reported before they were forced to take down their article).

  • Analyst 1 in PE - LBOs
Jun 26, 2022 - 8:56am

Trying to put together a list of lean L/S SMs that are down less than the mkt (YTD) - basically the top tier shops that are still left. So far I've got viking, soroban, third point, baupost, Coatue - any others you would add here? Thanks

  • Analyst 1 in HF - Event
Jun 26, 2022 - 10:33am

Neither Third Point nor Baupost (especially not Baupost) is a L/S equity fund

  • Research Analyst in HF - Other
Jun 26, 2022 - 2:39pm

A few of the funds you mentioned in there may be doing better than you think. 13F data is unreliable because it only shows total mkt value of current holdings. A lot of these funds have been selling into cash aggressively over the past year. Hence much smaller AUM reported on 13F. 

Jun 25, 2022 - 6:44am
Md._ Ashraful_Malek, what's your opinion? Comment below:

So all of these tiger cubs were just SM L/S funds, leveraging on tech blindly and putting some money on private markets . Is it for real? How can these blue-chip fund managers have not thought of this situation before

  • Intern in PE - LBOs
Jun 25, 2022 - 12:43pm

https://www.institutionalinvestor.com/article/b1ymbslxy7103c/We-Regret-the-Error

  • Principal in HF - RelVal
Jun 25, 2022 - 3:03pm

So whats the real story? Even with inaccuracies I highly doubt II would've put out the story if it wasnt at least mostly true 

Jul 4, 2022 - 6:53pm
Siiiu_golaso, what's your opinion? Comment below:

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