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Hedge fund Capula more than tripled its profit, nearly doubled its pay

Good times at London-based global-focused macro hedge fund Capula, it seems - even better than last year.

Yesterday, it posted financial results for the year ending 31 March 2023 for its two legal entities - Capula Investment Management LLP, a legal partnership, and Capula Investment Services LTD, a limited company. Its topline figures could make anyone look twice.

Revenue at the partnership was up from £271m ($345m) to £751m ($955m), a near tripling. Distributable profit was up even more dramatically – from £99m ($125m)  to £360m ($458m). That is… Pretty substantial. Those profits were available for distribution to its "members". 

The fund had 28 of these “members”, UK legal jargon for partners, throughout the period ending 2023. It had 26 in the period before. In that year, it paid out £28m ($36m) to member with the largest entitlement, compared to £114m ($145m) this year. That largest member is very possibly its largest single shareholder, Dr. Yan Huo.

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The fund’s pay increased too, although not quite proportionally. It paid a staggering £546k ($695k) to 209 people in the period ending in 2023, an 80% increase on the already high £303k ($386k) it paid to 200 in the year before that. Of those 9 new employees, only two were in "portfolio management and other activities", as opposed to seven new in "support activities".

The pay numbers include “wages and salaries” (which paradoxically seems to include discretionary bonuses) but not the payouts received by its very highest earners – portfolio managers and the like – who are usually registered as members. The limited company employs staff for the partnership.

Dr. Huo (PhD doctor, not medical) co-founded Capula back in 2005 with Masao Asai. Huo, who pops up in the upper echelons of the Sunday Times rich list, might not be on it for much longer. He’s a signatory of the giving pledge, a commitment to give away the majority of his fortune (which stood at £1.2bn or $1.6bn, according to the Times) before his death or in his will.

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AUTHORZeno Toulon

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