Tiger Management Corp. is an American

hedge fund A hedge fund is a Pooling (resource management), pooled investment fund that holds Market liquidity, liquid assets and that makes use of complex trader (finance), trading and risk management techniques to aim to improve investment performance and ...

and

family office A family office is a privately held company that handles investment management and wealth management for a wealthy family, generally one with at least $50–100 million in investable assets, with the goal being to effectively grow and transfer ...

founded by Julian Robertson. The fund began investing in 1980 and wound down in March 2000-01. It continues to operate in direct public equity investments and seeding new investment funds. It is colloquially known as the "Tiger Fund", with its alumni commonly referred to as " tiger cubs".

History

Julian Robertson, a

stockbroker A stockbroker is an individual or company that buys and sells stocks and other investments for a financial market participant in return for a commission, markup, or fee. In most countries they are regulated as a broker or broker-dealer and ...

and former

United States Navy The United States Navy (USN) is the naval warfare, maritime military branch, service branch of the United States Department of Defense. It is the world's most powerful navy with the largest Displacement (ship), displacement, at 4.5 millio ...

officer An officer is a person who has a position of authority in a hierarchical organization. The term derives from Old French ''oficier'' "officer, official" (early 14c., Modern French ''officier''), from Medieval Latin ''officiarius'' "an officer," fro ...

, started Tiger Management in 1980 with $8 million in capital. By 1996, the fund’s assets had increased to $7.2 billion in value. and On April 1, 1996 ''

BusinessWeek ''Bloomberg Businessweek'', previously known as ''BusinessWeek'' (and before that ''Business Week'' and ''The Business Week''), is an American monthly business magazine published 12 times a year. The magazine debuted in New York City in Septembe ...

'' carried a cover story written by reporter Gary Weiss, called "Fall of the Wizard", that was critical of Robertson's performance and behavior as founder and manager of Tiger Management. Robertson subsequently sued Weiss and ''BusinessWeek'' for $1 billion for

defamation Defamation is a communication that injures a third party's reputation and causes a legally redressable injury. The precise legal definition of defamation varies from country to country. It is not necessarily restricted to making assertions ...

. The suit was

settled A settler or a colonist is a person who establishes or joins a permanent presence that is separate to existing communities. The entity that a settler establishes is a settlement. A settler is called a pioneer if they are among the first settli ...

with no money changing hands and ''BusinessWeek'' standing by the substance of its reporting. With $10.5 billion of

assets under management In finance, assets under management (AUM), sometimes called fund under management, refers to the total market value of all financial assets that a financial institution—such as a mutual fund, venture capital firm, or depository institutio ...

in 1997, it was the second largest hedge fund in the world at the time. Its holdings climbed to $22 billion in 1998. However, in the late 1990s, Tiger Management faced challenges. The fund incurred significant losses during the 1998 Russian financial crisis and

Long-Term Capital Management Long-Term Capital Management L.P. (LTCM) was a highly leveraged hedge fund. In 1998, it received a $3.6 billion bailout from a group of 14 banks, in a deal brokered and put together by the Federal Reserve Bank of New York. LTCM was founded in ...

crisis and struggled to recover. Additionally, Robertson expressed concerns about the increasing market volatility and what he viewed as an irrational exuberance in technology stocks during the

dot-com bubble The dot-com bubble (or dot-com boom) was a stock market bubble that ballooned during the late-1990s and peaked on Friday, March 10, 2000. This period of market growth coincided with the widespread adoption of the World Wide Web and the Interne ...

. Tiger's largest equity holding at that time was U.S. Airways, whose financial troubles dragged down the value of the fund's holdings. Such missteps ultimately led him to close his investment company in March 2000 and return all outside capital to investors. Tiger earlier made $2 billion in gains, but gave most of them back during a huge one-day move in the yen in 1998. In September 2001, Robertson distributed 24.8 million greatly devalued U.S. Airways shares over to former investors in Tiger. Robertson declared his intent to keep the stock. U.S. Airways declared

Chapter 11 bankruptcy Chapter 11 of the United States Bankruptcy Code ( Title 11 of the United States Code) permits reorganization under the bankruptcy laws of the United States. Such reorganization, known as Chapter 11 bankruptcy, is available to every business, w ...

in 2002, and shareholders in the airline were wiped out.

Aftermath and legacy

After closing his Tiger Fund in 2000, Robertson started to use his own capital, experience, and infrastructure to support and finance ("seed") upcoming hedge fund managers. As of September 2009, Robertson had helped launch 38 hedge funds ("Tiger Seeds") in return for a stake in their fund management companies. Apart from those Tiger Seeds, a considerable number of analysts and managers Robertson employed and mentored at Tiger Management went out on their own and are now running some of the best-known hedge fund firms, called "Tiger Cubs", run by Tiger alumni such as Ole Andreas Halvorsen, Chris Shumway, Lee Ainslie, Stephen Mandel, John Griffin, Philippe Laffont, Dan Morehead, David Gerstenhaber, David Goel, Chase Coleman, Martin Hughes, Bill Hwang and Paul Touradji. "The modern-day emergence of hedge funds can be attributed to a 1986 article in the ''

Institutional Investor An institutional investor is an entity that pools money to purchase securities, real property, and other investment assets or originate loans. Institutional investors include commercial banks, central banks, credit unions, government-linked ...

'' highlighting the extraordinary returns of the Tiger Fund. The article spurred investor interest and financing; since that time, hedge funds have increasingly attracted investment and

human capital Human capital or human assets is a concept used by economists to designate personal attributes considered useful in the production process. It encompasses employee knowledge, skills, know-how, good health, and education. Human capital has a subs ...

." The ''

Wall Street Journal ''The Wall Street Journal'' (''WSJ''), also referred to simply as the ''Journal,'' is an American newspaper based in New York City. The newspaper provides extensive coverage of news, especially business and finance. It operates on a subscriptio ...

'' reported in June 2010 that Robertson was considering reopening his firm to outside investors. John Townsend, a former partner at

Goldman Sachs The Goldman Sachs Group, Inc. ( ) is an American multinational investment bank and financial services company. Founded in 1869, Goldman Sachs is headquartered in Lower Manhattan in New York City, with regional headquarters in many internationa ...

, was hired as the chief operating officer, and Robertson's son Alex joined the firm. The new hires were part of a potential expansion that could involve creating a "seeding" fund or a fund of hedge funds for outside investors. According to ''Institutional Investor'' magazine, that year many of the Tiger-seeded funds were struggling.

References

{{Hedge funds Tiger Management Investment management companies of the United States Hedge fund firms in New York City 2000 disestablishments in New York (state) Defunct hedge funds Privately held companies based in New York City American companies disestablished in 2000 American companies established in 1980 Financial services companies disestablished in 2000 Financial services companies established in 1980