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The New York-based manager, who once ran nearly $6 billion, has rebooted his business and recovered his performance after his firm's near-death experience in 2008.
In early 2008 Remy Trafelet was riding high. His New York-based hedge fund firm, Trafelet Capital Management, was managing $5.8 billion, thanks in part to his 25.1 percent annualized return from inception through 2007.
But like many other investors, the onetime Fidelity Investments portfolio manager, who founded Trafelet Capital in 1999, was hit hard by the financial crisis. His long-short equity hedge funds -- Delta Onshore, Delta Institutional, and Delta Offshore -- lost 28.4 percent in 2008.
His investors, starved for liquidity, suddenly fled. At least half the $2.5 billion in assets in the funds Trafelet personally ran came from the proprietary trading desks at major banks, including Merrill Lynch, Deutsche Bank and Citigroup. The banks needed their money back immediately, and Trafelet refused to erect a gate on redemptions to stanch the outflows, effectively leading to a run on the bank.
Even though he rebounded in...