(Bloomberg) -- Izzy Englander’s Millennium Management earned more than $500 million from commodities investments last year, people familiar with the matter said, as the business develops after becoming a standalone unit.
The returns are roughly on par with those booked in 2023, when the multistrategy firm’s commodities arm brought in about $600 million. Much of those gains were driven by trading in natural gas markets, which has been buffeted by volatility over the past three years.
A spokesperson for Millennium, which manages about $72 billion, declined to comment.
Commodities has been a key area of focus for multistrats in recent years amid volatility stoked by extreme weather and geopolitical upheaval, such as Russia’s invasion of Ukraine in 2022.
Citadel’s commodities business generated a record of about $8 billion that year. Trading profits across the industry have been relatively more muted since as volatility eased, with Ken Griffin’s firm generating about half that amount in both 2023 and 2024.
Those affected by the slowdown include large commodity-trading shops such as Glencore Plc and Gunvor Group and hedge fund boss Pierre Andurand, who ditched oil trades for bets on copper and cocoa.
Series of Moves
Millennium has made a series of moves aimed at bolstering profits since it separated commodities from its fixed-income unit more than a year ago and named Goldman Sachs Group Inc. alumnus Anthony Dewell as global head of the business.
While several high-profile employees left the firm last year, Millennium made a slew of hires. It also built a centralized research group that works with the investment teams’ own researchers to bolster their analytical capabilities.
Recent departures include senior portfolio managers Kevin Gan, a Puerto Rico-based energy trader, and Switzerland-based senior oil trader Roberto Rosales, said the people, who asked not to be identified discussing personnel. Chad van Delden, a member of Gan’s team, also left to join French utility Engie SA as a senior natural gas trader, the people said.
Among those hired recently as senior portfolio managers are Matthew Cross, who joined in Asia; Lewis Jones, a trader focused on oil; and Pavel Favinsky, a former Citigroup Inc. environmental commodities trader.
Last year Millennium backed Farrer Capital Management with about $500 million, according to a person familiar with the matter. The Australia-based agricultural commodities hedge fund is the latest in a flurry of external firms Englander’s firm has backed in recent years.
--With assistance from Hema Parmar.
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