Ex-Amaranth Traders Lose 15% at Moore Capital's Canada Unit - Bloomberg

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Ex-Amaranth Traders Lose 15% at Moore Capital's Canada Unit

By Jenny Strasburg

Dec. 5 (Bloomberg) -- A group of former Amaranth Advisors LLC traders, recruited last year to start a Canadian hedge-fund unit for Moore Capital Management Inc., lost 15 percent in November, two people with knowledge of the firm said.

The Toronto-based unit, which managed $1 billion before the decline, opened a year ago to invest money for other Moore funds. It is overseen by Manos Vourkoutiotis, who was hired by the New York-based firm after Amaranth collapsed in September 2006. Last month's performance was hurt by stock and convertible-bond bets.

Moore, founded by Louis Bacon, has about $13 billion in assets. Its Moore Global Investment Fund Ltd., which invests in global stocks, bonds, currencies and commodities, declined 2 percent in November, trimming its 2007 gain to 15 percent. The benchmark Standard & Poor's 500 Index lost 4.2 percent last month, the most since December 2002.

``November was a tough month, but Moore will want to look closely to see whether the managers in Canada were taking too much risk,'' said Geoffrey Bobroff, an independent investment consultant in East Greenwich, Rhode Island, who isn't a Moore client. ``Assuming clients are invested in more than just this pool, they could be OK.''

The Canadian unit's returns had been mostly unchanged for the year through October, according to the people, who asked not to be identified because Moore's investments are private. Moore Canada's loss compares with the industry's average decline of 2.4 percent in November, according to the HFRX Index, an estimate calculated daily by Chicago-based Hedge Fund Research Inc. based on a sample of fund managers.

John Lute, a spokesman for Vourkoutiotis in Toronto, declined to comment. Vourkoutiotis didn't respond to a call and e-mail seeking comment.

Amaranth Casualty

The 38-year-old trader joined Moore after Greenwich, Connecticut-based Amaranth lost a record $6.6 billion on bad natural-gas trades. Vourkoutiotis managed the firm's investments in Canadian debt, equities and derivatives for six years.

He started his career in 1991 trading convertible securities at RBC Dominion Securities Inc. and Nesbitt Burns, the stock-brokerage unit of the Bank of Montreal, according to Amaranth marketing documents. He graduated in 1991 from the University of Toronto with a bachelor of commerce degree.

Bacon brought on the ex-Amaranth employees to trade a range of securities including distressed debt, convertible bonds and equities. They were hired to help Moore ``establish a significant, rewarding and long-term presence in Canada,'' Elaine Crocker, Moore's president, said in an October 2006 statement.

Vourkoutiotis was one of the first of Amaranth's senior executives to move on after the firm lost 70 percent of its money in two weeks on natural-gas bets overseen by trader Brian Hunter.

To contact the reporter on this story: Jenny Strasburg in New York at jstrasburg@bloomberg.net

Last Updated: December 5, 2007 00:10 EST