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THE SOROS SAGA

Soros's Quantum empire also started to unravel in 2000.* Soros Fund Management had massive losses in March/early April 2000. Quantum, the flagship fund, was down 32 percent. In contrast, Quantum had generated an annual average return of 36 percent since inception.

While it did not close as Robertson's did, it underwent tremendous change. A number of key people left. Stanley Druckenmiller, 47, who had been the chief investment officer for the Quantum Fund for 12 years, and Nicholas Roditi, 54, who had managed the Quota Fund, left. The retirement announcement for both came on April 28, 2000. When Soros announced the reorganization of his then $14 billion fund group, the flagship Quantum Fund was down 20 percent for 2000. Investors redeemed about $3 billion when Druckenmiller announced his departure.

Soon after the retirement announcement, other key employees decided to leave: Duncan Hennes, chief executive officer, and Peter Streinger, chief financial officer, announced their departures. Scott Bessent, a 10-year veteran who managed the $1.5 billion of non-U.S. stocks in London, left on June 30, 2000, to form Bessent Capital. Walter Burlock, who had been a managing director since 1990, left to start Origin Capital Management. Carson Levit joined Pequot Capital and Michael Karsh formed Karsh Capital, while David Kovitz and Sheldon Kasowitz set up Indus Capital Management.

Soros's reason for the reorganization was that the fund had become too large. Furthermore, the objectives of the Soros funds changed. Going forward, Quantum would use lower-risk strategies. Soros instituted a more conservative approach to trading. "In my old age, I have become more conservative. Using less leverage is what I want. . . . It's less risk. I'm looking for 15 percent returns, not 30 percent returns."12

On July 1, Soros merged Quantum Fund and Quantum Emerging Growth Fund into a new, $6.5 billion fund, Quantum Endowment Fund. The fund allocates about half to less volatile macro and arbitrage

* This profile has been written from information gleaned from Soros's several books and interviews reported in the press over the year.