Millennium shuts two trading pods in Asia, managers to leave

Hedge fund platforms like Millennium and Balyasny Asset Management LP allocate capital among pods trading with different strategies. They keep a close tab on the amount of losses each can sustain before its trading risk is curtailed or the team is shuttered.

Millennium Management shuttered two index-rebalancing pods in Asia this month, said a person with knowledge of the matter.

The first was led by Shao Ying and the second by Zachary Corones, said the person, who asked not to be identified discussing private information. Both Hong Kong-based portfolio managers are leaving the firm.

The performance of both teams, their assets under management and details of the decisions to shutter them weren’t immediately clear. Markets whipsawed earlier this month amid concerns about a weakening US economic outlook and tighter Japanese monetary policy.

A Millennium representative declined to comment. Shao and Corones didn’t immediately reply to messages requesting comment via LinkedIn.

Hedge fund platforms like Millennium and Balyasny Asset Management LP allocate capital among pods trading with different strategies. They keep a close tab on the amount of losses each can sustain before its trading risk is curtailed or the team is shuttered. The approach allows the firms to post steady returns, even when individual pods suffer losses in times of market swings.

The Bank of Japan hiked interest rates for the second time in 17 years on July 31 and hinted at more increases to come. Combined with concerns about a weaker US economy, it let loose days of gyrations in global financial markets.

Japan’s Topix index had the biggest three-day losing streak going back to 1959. The wild moves triggered circuit breakers that briefly halted index futures trading.