Key Takeaways
- • Oliver Brennan, an FX strategist at Brevan Howard with a physics background and prior teaching experience at Dr Challoner's Grammar School, has departed the hedge fund, marking another senior-level exit in recent months.
- • Brevan Howard has experienced a wave of portfolio manager and trader departures, including Roberto Hoornweg (to Standard Chartered in December 2016), Paul Ellis (former yen trading chief), and Mark Deniston (to Royal Bank of Scotland in January 2017), signaling organizational restructuring focused on macro-strategy roles.
- • The firm faced significant asset outflows in 2016, with $7 billion withdrawn by investors and assets under management declining to $15.6 billion by year-end, prompting a November share buyback offer in its BH Macro Limited fund that 48% of investors accepted to prevent a wind-down.
- • Brennan's career trajectory—joining Brevan Howard in 2007, departing for State Street Global Investors in 2011, briefly moving to Tudor Investment Corporation in 2012, and returning to Brevan Howard before his latest departure—reflects broader volatility in senior talent retention at the hedge fund.
- • The exits underscore Brevan Howard's apparent strategic retrenchment, with the firm cutting back macro-focused staff positions despite historically recruiting highly-quantitative professionals from top-tier universities.
Summary
Oliver Brennan, an FX strategist at Brevan Howard, has become the latest senior departure from the European hedge fund, adding to a pattern of executive-level exits throughout late 2016 and early 2017. Brennan's career path—from physics teacher to quantitative hedge fund professional—represents an unconventional entry into financial markets. After earning a Master's degree in Physics from Oxford, he spent two years teaching at Dr Challoner's Grammar School in Buckinghamshire before joining Brevan Howard in 2007, where he remained until 2011.
Brennan's tenure at Brevan Howard was interrupted by brief stints elsewhere. He moved to State Street Global Investors in 2011 but remained there less than a year before transitioning to Tudor Investment Corporation in February 2012. He returned to Brevan Howard by August 2012 and remained until departing earlier in February 2017. Despite his unconventional background relative to typical hedge fund recruits, Brennan aligned with Brevan Howard's historical preference for highly-quantitative professionals educated at elite institutions.
Brennan's departure reflects a broader organizational challenge at Brevan Howard. The firm has experienced multiple senior-level exits over the preceding months: Roberto Hoornweg, former head of securities distribution at UBS who joined Brevan Howard in 2012, departed to join Standard Chartered in December 2016. Paul Ellis, the former yen trading chief at Credit Suisse, also left the firm. Mark Deniston, previously head of sterling rates swaps at Goldman Sachs and a Brevan Howard employee since 2013, exited in January 2017 to lead GBP rates trading at Royal Bank of Scotland. These departures suggest Brevan Howard is specifically cutting back macro-focused portfolio managers and traders.
The exits coincide with significant investor redemptions. During 2016, Brevan Howard experienced $7 billion in asset withdrawals, reducing assets under management to $15.6 billion by December 2016. In response, the firm offered to buy back shares in its BH Macro Limited fund in November 2016, a move designed to prevent a fund wind-down; 48% of investors accepted the buyback offer. This capital reduction and management turnover together indicate Brevan Howard is navigating a period of strategic repositioning and operational contraction.
Brennan's tenure at Brevan Howard was interrupted by brief stints elsewhere. He moved to State Street Global Investors in 2011 but remained there less than a year before transitioning to Tudor Investment Corporation in February 2012. He returned to Brevan Howard by August 2012 and remained until departing earlier in February 2017. Despite his unconventional background relative to typical hedge fund recruits, Brennan aligned with Brevan Howard's historical preference for highly-quantitative professionals educated at elite institutions.
Brennan's departure reflects a broader organizational challenge at Brevan Howard. The firm has experienced multiple senior-level exits over the preceding months: Roberto Hoornweg, former head of securities distribution at UBS who joined Brevan Howard in 2012, departed to join Standard Chartered in December 2016. Paul Ellis, the former yen trading chief at Credit Suisse, also left the firm. Mark Deniston, previously head of sterling rates swaps at Goldman Sachs and a Brevan Howard employee since 2013, exited in January 2017 to lead GBP rates trading at Royal Bank of Scotland. These departures suggest Brevan Howard is specifically cutting back macro-focused portfolio managers and traders.
The exits coincide with significant investor redemptions. During 2016, Brevan Howard experienced $7 billion in asset withdrawals, reducing assets under management to $15.6 billion by December 2016. In response, the firm offered to buy back shares in its BH Macro Limited fund in November 2016, a move designed to prevent a fund wind-down; 48% of investors accepted the buyback offer. This capital reduction and management turnover together indicate Brevan Howard is navigating a period of strategic repositioning and operational contraction.
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