Ex-Citadel Managers Plan Health-Care and Tech Fund

(Bloomberg) -- Two investors who formerly oversaw multibillion-dollar portfolios at Citadel are teaming up to start a hedge fund.

Michael Rockefeller, who led Citadel’s health-care team in San Francisco, and Karl Kroeker, who specialized in technology investments, are launching the fund, according to people with knowledge of the matter. The pair added Matthew Hooker, former head of U.S. trading at Citadel’s global equities business, as chief operating officer.

The San Francisco-based hedge fund, which doesn’t yet have a name, will wager on health-care and technology stocks, said the people, who asked not to be identified because the information is private. The team expects to start trading in the third quarter of next year with at least $1 billion, the people said.

Rockefeller, who resigned from Citadel last year, oversaw as much as $2 billion and spent six years at the firm. Kroeker, who’d been there for 13 years, managed about $3 billion and left in February 2017. Hooker spent 12 years at Citadel and departed in the second quarter of 2017.

While hedge fund performance has lagged the stock market in recent years, the frenetic pace of closures in 2015 and 2016 has abated and the number of hedge funds in existence has stabilized. According to data provider Hedge Fund Research Inc., 306 funds opened and 270 funds closed in the first two quarters of the year, compared with 735 starting and 784 closing in all of 2017.

To contact the reporters on this story: Simone Foxman in New York at sfoxman4@bloomberg.net;Katia Porzecanski in New York at kporzecansk1@bloomberg.net

To contact the editors responsible for this story: Margaret Collins at mcollins45@bloomberg.net, Steven Crabill, Pierre Paulden

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