Healthcare is bright spot for the hedge fund industry even as investors pull out billions. Now, a Citadel portfolio manager with a medical degree who focuses on the sector is launching his own fund.
- Citadel portfolio manager Prashanth Jayaram is launching his own fund, named Tri Locum Partners.
- Jayaram is a healthcare specialist, and has a medical degree from the University of Pennsylvania.
- It is unclear how much he is planning to raise for the new fund.
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Another one of Ken Griffin's portfolio managers is getting ready to set out on his own.
Prashanth Jayaram, who joined Citadel as a healthcare portfolio manager in 2015, is launching his own fund, sources tell Business Insider. The new venture is going to be called Tri Locum Partners, and the firm has already hired a head of investor relations and business development, Christabel Syham, who worked previously worked in a similar role at healthcare-focused Senzar Asset Management. Tri Locum, sources say, will be market-neutral.
Citadel declined to comment. Jayaram did not respond to requests for comment.
Jayaram will join the expansive Tiger family tree, since he also worked as an analyst at Lee Ainslie's Maverick Capital from 2009 to 2012. After that, he worked as an analyst for Citadel for two years before joining Millennium's Lion Arch Capital as a portfolio manager. But after a year at the Millennium-linked fund, he rejoined Citadel as a portfolio manager.
Jayaram's education section of his resume is impressive, with a degree from both Wharton and the University of Pennsylvania's medical school, as well as the business school from the Hong Kong University of Science and Technology. He's also worked for McKinsey, Morgan Stanley, Penn's endowment fund, a division of AllianceBernstein, and founded a company to make it easier for doctors to find new research.
It is unclear how much Jayaram is planning to raise for his new offering or when the fund will officially begin trading, but Citadel alumni have been raking in cash with new funds recently. Last year alone saw several billion-dollar launches, including Mike Rockefeller and Karl Kroeker's Woodline Capital and Richard Schimel and Larry Sapanski's Cinctive Capital.
Bloomberg has also reported on two funds run by ex-Citadel employees, Brendon Haley's Holocene Advisors and Michael Cowley's Sandbar Asset Management, who have seen assets surge despite investors' overall displeasure with the industry.
Despite the outflows facing the industry, healthcare funds have been an area investors are hoping to put more money in. A Jefferies report from 2019 noted while investors were turning away from generalist stock-picking funds, sector-specific funds that focused on healthcare or technology were still in demand. A recent study from Goldman Sachs found that healthcare, biotech, and technology and media were all in-demand sectors.
Joseph Edelman's Perceptive Advisors' flagship fund soared more than 50% last year thanks to its biotech holdings, and Hedge Fund Research's healthcare fund index notched 17.44% returns in 2019 - a big improvement on the 9.5% the overall industry index returned.