Overview – Citadel Investment Group
Citadel Investment Group is based in Chicago, Illinois, but it is a worldwide financial institution. Kenneth C. Griffin, a trader, founded the group in 1990 and the firm’s current activities include hedge fund administration, multi-manager investment strategy, and equity options market-making.
By 1998, the company had grown to having more than a billion in investment capital, organized globally through a variety of approaches.
Citadel Investment Group leader in Hedge Fund Investments – A hedge fund is an investment fund that is only opened to a limited range of investors. Each different fund has its own strategy, which will determine the type of investments and the method of investment. Hedge funds usually invest in a diverse range of investments such as shares, commodities and debt.
Hedge funds are designed to offset the potential losses in the markets they invest in by “hedging” the investments in a variety of ways. The net asset value of a hedge fund can be as high as billions of dollars so this type of investing dominates certain specialty markets.
Citadel Investment Group Fought Off Troubled Times
In 2008, Citadel Investment Group fought off rumors about liquidation. During a time when the market took a plunge, even those companies that specialized in hedge funds suffered losses. Rumors that they would be shut down swirled around Citadel, as with so many other companies. While the Federal Reserve Financial Services Authority did visit Citadel’s offices, the Chicago-based operation was able to demonstrate that though the market had dropped 26% to 30%, they still held 30% of its capital in cash.
By January of 2009, Ken Griffin noted that the “market madness” provided some of the greatest opportunities he had seen in a long time.
Changes were in store in the new economy for Citadel Investment Group – Recent speculation is that Citadel Investment Group LLC would like to set up a leveraged-load-trading unit because the market for debt is back to 42%, returning from a low during the winter. This is an attempt to find new market trends during a recovery period. Established operations for trading leveraged loans are frequently used for corporate buyouts. It has been speculated that this line of loan trading investment would fit in with Citadel Investment Group since it has always been more of an investment bank than other hedge fund institutions.
Citadel Investment Group Keeping on Top of Market – Today, Citadel manages $11 billion and one of their flagship hedge funds has returned an average of 20% per year for the years 1998 to 2006. It is speculated that the hedge fund and investment firm has spent more than hundreds of millions of dollars to develop strategies, hardware, and software to keep current in the market.
Citadel Investment Group LLC Keeps Strong in Market – Currently, Citadel Investment Group LLC current still operates as a private owned hedge fund sponsor. The firm invests fixed income, credit, public equity, and options markets from all over the world. Most commonly Citadel makes investments in United States convertibles and Japanese equity warrants with some European involvement.