Engineers Gate cuts most of fundamental equities team after losses

Engineers Gate dismissed most of its fundamental equities team, including its head Mike Daylamani, after a performance review, Bloomberg first reported. The New York manager cut the unit after a difficult October, when losses tied to the technology-sector selloff pushed it to restructure parts of its investment platform.

The Synthesis unit accounted for roughly 14% of Engineers Gate's gross market value at the end of October, and five fundamental portfolio managers remain at the firm.

The cuts leave fund selectors to assess where the firm redeploys the 14% of gross market value previously run by Synthesis.

Engineers Gate was down 5.5% for October through Oct. 23, a person familiar with the firm's results said, as sharp reversals in AI and technology stocks triggered losses across multiple hedge fund strategies.

Greg Eisner, the chief executive, told investors the team's results had fallen short of the standards required to keep its existing structure, according to the report.

The restructuring extends beyond Synthesis, Bloomberg reported: the firm is also exiting or reducing allocations to a small number of lower-conviction portfolios and scaling back allocations to external China-focused managers as it develops internal investment capabilities in Asia.