Key Takeaways
- • Richard Herman, 44, departed Deutsche Bank in May 2015 as global head of fixed income, currencies, and commodities trading after an extended tenure at the institution, contrary to his public statements about "walking the earth."
- • Herman co-founded Montrock48, a macro-focused hedge fund, with Lou Jaffe, Deutsche Bank's former head of fixed income sales for the Americas who exited the bank in June 2015 after more than 20 years of service.
- • The timing of Montrock48's launch coincides with a challenging environment for macro hedge funds in 2015, with multiple funds closing operations during the year.
- • Both founders leveraged senior-level Deutsche Bank credentials and client relationships in the fixed income and trading divisions to establish their hedge fund operations.
Summary
Richard Herman's May 2015 departure from Deutsche Bank marked a significant shift in the institution's fixed income leadership. The 44-year-old global head of fixed income, currencies, and commodities trading publicly characterized his exit as an opportunity to pursue personal interests, suggesting he would depart the financial sector entirely. However, subsequent reporting revealed that Herman remained in New York and had instead launched a hedge fund venture.
Herman co-founded Montrock48 with Lou Jaffe, leveraging their combined expertise in fixed income markets and client relationships. Jaffe, who held the position of head of fixed income sales for the Americas at Deutsche Bank, followed Herman's departure by leaving the institution in June 2015 after accumulating more than 20 years of service. The partnership brought together complementary skill sets: Herman's trading background and strategic oversight alongside Jaffe's institutional client relationships across the Americas.
Montrock48 positioned itself as a macro-strategy hedge fund, entering the market during a notably difficult period for the sector. The macro hedge fund landscape in 2015 experienced significant headwinds, with multiple funds ceasing operations. Despite these headwinds, the co-founders' decision to establish the fund reflected confidence in their ability to generate returns through macroeconomic positioning and their established networks within Deutsche Bank's former client base.
The departure of Herman and Jaffe exemplified a broader pattern of senior Deutsche Bank professionals transitioning to alternative investment management, potentially signaling either dissatisfaction with the institution's strategic direction under new leadership or attractive entrepreneurial opportunities in hedge fund management. Their exit provided alternative career pathways for remaining Deutsche Bank fixed income staff seeking alternatives to the bank's evolving strategic positioning.
Herman co-founded Montrock48 with Lou Jaffe, leveraging their combined expertise in fixed income markets and client relationships. Jaffe, who held the position of head of fixed income sales for the Americas at Deutsche Bank, followed Herman's departure by leaving the institution in June 2015 after accumulating more than 20 years of service. The partnership brought together complementary skill sets: Herman's trading background and strategic oversight alongside Jaffe's institutional client relationships across the Americas.
Montrock48 positioned itself as a macro-strategy hedge fund, entering the market during a notably difficult period for the sector. The macro hedge fund landscape in 2015 experienced significant headwinds, with multiple funds ceasing operations. Despite these headwinds, the co-founders' decision to establish the fund reflected confidence in their ability to generate returns through macroeconomic positioning and their established networks within Deutsche Bank's former client base.
The departure of Herman and Jaffe exemplified a broader pattern of senior Deutsche Bank professionals transitioning to alternative investment management, potentially signaling either dissatisfaction with the institution's strategic direction under new leadership or attractive entrepreneurial opportunities in hedge fund management. Their exit provided alternative career pathways for remaining Deutsche Bank fixed income staff seeking alternatives to the bank's evolving strategic positioning.
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