Billionaire hedge-fund guru known in NZ for his luxury lodges and wineries
Julian Robertson, who has died aged 90, was the billionaire founder of Tiger Management. He became one of his generation’s most successful hedgefund managers and a mentor to a wave of investors known as Tiger Cubs.
Robertson, who died of cardiac complications at his home in Manhattan, had strong ties to New Zealand and split his time there and in the United States. He owned wineries as well as several golf resorts. His family owns lodges in Kauri Cliffs near Matauri Bay, Northland; Matakauri Lodge in Queenstown; and The Farm at Cape Kidnappers in Hawke’s Bay.
He started New
York-based Tiger
Management in
1980 with US$8.8 million. He was 48 at the time, relatively old to be launching his own firm. By mid-1998, assets had soared to about $22 billion on the back of annual returns averaging 32%, earning him a reputation on a par with those of industry peers such as George Soros.
‘‘If I had had to give my own money to any of them, I would have given it to Robertson,’’ investor Jim Chanos said in an interview for More Money Than God, a 2010 book on hedge funds by Sebastian Mallaby. ‘‘I knew that he knew stocks better than anyone.’’
Robertson had an estimated net worth of $4b, according to the Bloomberg Billionaires Index.
Known for his strength of personality and extensive network of advisers, Robertson instilled in his traders his keys to success, Mallaby wrote. They included managing holdings aggressively, removing good companies to make room for better ones, not risking more than 5% of capital on one bet, and keeping the faith through bad times.
Robertson, who had started out primarily as a stock picker, began ramping up bets in bonds and foreign exchange in the 1990s, veering into the territory of macro fund managers, so called because they wager on macroeconomic trends that drive fluctuations in interest rates and currencies.
A wrong-way bet on the yen in 1998 sent investors fleeing from Tiger. In March 2000, Robertson announced that he was closing his six Tiger funds, after watching assets dwindle to $6b from $21b in 18 months. ‘‘There is no point in subjecting our investors to risk in a market which I frankly do not understand,’’ he wrote in a letter to investors. ‘‘We have seen manic periods like this before and I remain confident that despite the current disfavour in which it is held, value investing remains the best course.’’
Robertson’s firm spawned dozens of ‘‘cubs’’ – former employees who learned the trade at Tiger before branching out on their own.
After he closed down Tiger, he also seeded many young managers, giving them capital in exchange for a share of their profits. ‘‘The true success of Robertson and Tiger extends beyond the stellar performance numbers and mind-boggling assets under management,’’ Daniel Strachman wrote in Julian Robertson: A Tiger in the Land of Bulls and Bears, in 2004. ‘‘Ultimately, the success of the firm can be measured in the legacy of his cubs.’’
Julian Hart Robertson Jr was born in North Carolina. He earned a bachelor’s degree in business from the University of North Carolina before spending two years in the US Navy. Robertson joined
Kidder Peabody & Co in 1957, rising through the ranks to eventually become chief executive officer of Webster Management, Kidder Peabody’s asset-management arm, in 1974.
Robertson ‘‘was like a sponge, constantly soaking up as much information as he could from his colleagues, peers and competitors’’, Strachman wrote. ‘‘His skill was learning from others and taking the knowledge and turning it into profits for the firm, his colleagues, his clients and, of course, himself.’’
One of those he learned from directly was Alfred Winslow Jones, regarded as the intellectual father of the hedge (or ‘‘hedged’’) fund, meaning one that placed bets on the market falling as well as rising.
In 1978, Robertson and his wife, Josie, moved to New Zealand, where he planned to write a novel. After six months, he concluded that he was better at investing than he was at writing and returned to New York, where he founded Tiger Management with a former Kidder Peabody colleague, Thorpe Mckenzie. The name, Strachman wrote, was inspired by Robertson’s habit of calling people ‘‘Tiger’’ if he couldn’t remember their name. By 1991, the firm managed $1b in assets.
In addition to his hedge-fund career, Robertson ran the Tiger Foundation to support low-income New Yorkers and their families. Since its inception in 1989, it has provided more than $250m in grants to help schools, employment training and childhood education, according to its website.
‘‘I didn’t want my obituary to be, ‘He died getting a quote on the yen,’ ’’ Robertson said in a 2013 interview with the Australian Financial Review.
Robertson’s wife, the former Josephine Tucker, died of breast cancer in 2010. They had three sons: Julian III, known as Jay, who managed his father’s properties in New Zealand; Alexander, who became president of Tiger’s seeding business; and Spencer, who worked at the Tiger Foundation before founding Pave charter schools. – Bloomberg