Goldman’s prop trading team, Principal Strategies, has joined KKR, reports Dealbook.The traders working under Bob Howard, about 9 traders, had been courted or courting Perella Weinberg, KKR, and most recently, Avenue Capital.
They’ll start at KKR in January, according to CNBC’s Kate Kelly, who says the move is part of KKR’s plan to build a new long short equity strategy.
rumours have been swirling about their move to KKR since September.
Today, Goldman said in a statement to Dealbook:
“Over several decades, Principal Strategies has been a successful global investing business with a strong performance record with a culture of disciplined risk management.”
“We wish Bob and his team every success in their home.”
Henry Kravis, the head of KKR, added:
“This is part of a strategic build out of our asst management platform.”
“Our goal has been to add new capabilities and exceptional talent that allow us to strengthen our product offering and better service our clients. Bob and his team will be an ideal fit for that objective as we’ve been impressed with their investment experience and performance as well as their ability to manage risk.”
The interesting thing is that each bank is dealing with the Volcker Rule differently.
Both Goldman and Morgan Stanley have gotten volckered this week, and Bank of America has also cut prop traders recently, about 30-40 of them. But JPMorgan, which cut their entire prop trading business, is keeping their hedge fund, Highbridge.