Key Takeaways
- • Hedge funds are accelerating job cuts and closing investment teams as weak performance forces firms to dismiss portfolio managers and return investor capital, according to reporting on November 6, 2026.
- • According to Bloomberg performance data cited by eFinancialCareers, many funds have fallen below Ken Griffin's viability benchmark of the risk-free rate plus 4%, which now exceeds 8% based on the three-month Treasury yield.
- • Mike Alfaro, CIO of Gallo Partners, said 108 investment pods have been closed so far in November, intensifying competition among displaced portfolio managers.
- • Recently hired managers at Walleye, Engineers Gate and Brevan Howard have been dismissed, including Anil Gondi, Mike Daylamani and David Heinau.
- • Alfaro does not expect a V-shaped recovery in momentum-driven strategies, and says firms will increasingly favor managers who can take effective risk rather than follow consensus strategies.
Summary
Hedge funds are accelerating job cuts and closing investment teams across major financial markets as disappointing performance pushes firms to dismiss portfolio managers and return investor capital. The downturn, reported on November 6, 2026, has created a growing pool of unemployed investment professionals and increased uncertainty across the industry.
According to Bloomberg performance data cited by eFinancialCareers, numerous hedge funds have fallen below the annual performance threshold associated with Ken Griffin's standard for a viable fund: the risk-free rate plus 4%. Based on the prevailing three-month Treasury yield, that benchmark now exceeds 8%. Mike Alfaro, chief investment officer of New York-based long-short equity fund Gallo Partners, said 108 investment pods have reportedly closed in November, intensifying competition among displaced managers.
The cuts have reached recently recruited professionals. Anil Gondi, who led Walleye's equity long-short business, joined in 2025 after leaving Balyasny in June 2024. Engineers Gate reportedly eliminated its stock synthesis team, including Mike Daylamani, who joined in January 2025, and Brevan Howard dismissed David Heinau, who joined in December 2025 after eight years leading proprietary trading at TD Securities in London. Alfaro also cited a manager in his early 40s who was up 14% earlier this year with a market-neutral book but is now down 9% and has been fired. That manager had declined multistrategy offers featuring $15 million sign-on bonuses while seeking a larger package.
Alfaro said future hiring depends heavily on whether markets recover quickly, and he does not expect a V-shaped rebound in momentum-driven strategies. He also criticized some managers for relying on short-term market movements while marketing themselves as market-neutral, and said managers who abandon their theses when markets move against them will be among those dismissed. Gallo Partners described its annual performance as "flattish" and reported a slight gain in November.
The consequences may extend to investment banks. According to market intelligence provider Tricumen, equities desks recorded a strong year, with revenue per employee rising more than 30%. However, a growing supply of experienced hedge fund professionals could reduce pressure on banks to raise compensation. A veteran credit trader said the availability of experienced candidates could weaken pay and recruitment prospects across the industry.
According to Bloomberg performance data cited by eFinancialCareers, numerous hedge funds have fallen below the annual performance threshold associated with Ken Griffin's standard for a viable fund: the risk-free rate plus 4%. Based on the prevailing three-month Treasury yield, that benchmark now exceeds 8%. Mike Alfaro, chief investment officer of New York-based long-short equity fund Gallo Partners, said 108 investment pods have reportedly closed in November, intensifying competition among displaced managers.
The cuts have reached recently recruited professionals. Anil Gondi, who led Walleye's equity long-short business, joined in 2025 after leaving Balyasny in June 2024. Engineers Gate reportedly eliminated its stock synthesis team, including Mike Daylamani, who joined in January 2025, and Brevan Howard dismissed David Heinau, who joined in December 2025 after eight years leading proprietary trading at TD Securities in London. Alfaro also cited a manager in his early 40s who was up 14% earlier this year with a market-neutral book but is now down 9% and has been fired. That manager had declined multistrategy offers featuring $15 million sign-on bonuses while seeking a larger package.
Alfaro said future hiring depends heavily on whether markets recover quickly, and he does not expect a V-shaped rebound in momentum-driven strategies. He also criticized some managers for relying on short-term market movements while marketing themselves as market-neutral, and said managers who abandon their theses when markets move against them will be among those dismissed. Gallo Partners described its annual performance as "flattish" and reported a slight gain in November.
The consequences may extend to investment banks. According to market intelligence provider Tricumen, equities desks recorded a strong year, with revenue per employee rising more than 30%. However, a growing supply of experienced hedge fund professionals could reduce pressure on banks to raise compensation. A veteran credit trader said the availability of experienced candidates could weaken pay and recruitment prospects across the industry.
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