A powerful incentive.
The billionaire investor Steven A. Cohen is putting pressure on his traders to try to keep his investment firm together, as the once-powerful hedge fund awaits a judge’s decision next week on its guilty plea to securities fraud charges.
The New York Times reports that Cohen is seeking to stem a slow but steady departure of top portfolio managers by pressing those who remain to sign two-year contracts that would bind them to him until the end of 2016, said people briefed on the matter. His firm has also threatened to sue some traders who left before their existing contracts were up and required them to delay the start dates of their new jobs as a condition for their early release, these people said.
The push by Cohen to lock up as many top traders as possible is an indication that the future success of what will become a firm managing only the 57-year-old investor’s considerable fortune is still uncertain. In letters to the staff, Cohen has said the firm doesn’t intend to shrink much below its current size of 850 employees and expects to operate for many more years despite an insider trading investigation that has led to guilty pleas or convictions of eight former SAC employees.
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