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Giant Quant Firm AQR Cuts Jobs After a Dismal Year

Sonali Basak and Erik Schatzker
Giant Quant Firm AQR Cuts Jobs After a Dismal Year

(Bloomberg) -- AQR Capital Management, the giant quantitative fund manager run by Cliff Asness, is cutting jobs after a year of poor performance.

The firm-wide reductions will amount to a low single-digit percentage of the workforce, according to a person familiar with the matter. The firm, which managed $226 billion at the end of September, had more than 1,000 employees across its global offices, according to its website.

“At AQR, we have experienced record headcount growth over the past three years, including 2018,” the company said in a statement Tuesday. “Recent small reductions in headcount reflect the need to balance our workforce growth with the current needs of our business.”

Last year, Asness defended the quantitative strategies that he helped pioneer, writing a 17,000-word blog post to acknowledge that his technique was enduring a tough time but there’s evidence it will prevail. Of 41 AQR mutual funds, only two had positive returns over the past year, according to data compiled by Bloomberg. AQR’s U.S. mutual funds had outflows of $5 billion in the first 11 months of 2018, according to data from Morningstar Inc.

The worst performers at the Greenwich, Connecticut-based investment firm include the AQR Style Premia Alternative Fund, which is down more than 14 percent in the past year. The AQR Managed Futures Strategy Fund dropped almost 11 percent in that time frame, while another fund stripped "risk parity" from its name after redemptions. That change would allow for more leeway to bet against stocks and bonds, which could help navigate volatile markets.

Suzanne Escousse, AQR’s chief marketing officer, declined to comment beyond the statement.

(Updates with performance of funds in fourth paragraph.)

To contact the reporters on this story: Sonali Basak in New York at sbasak7@bloomberg.net;Erik Schatzker in New York at eschatzker@bloomberg.net

To contact the editors responsible for this story: Michael J. Moore at mmoore55@bloomberg.net, Vincent Bielski

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