Something Strange Is Afoot At Massive Hedge Fund DE Shaw

People aren’t sure to make sense of whatever is currently going on at the hedge fund DE Shaw. They’re making everyone that works for them sign new non-compete clauses. DE Shaw leaders said this was to bring the company in line with what other hedge funds do. However, a lot of people aren’t buying this.

People that don’t sign this agreement have been warned they will be fired if they don’t sign the dotted line. Why would DE Shaw, a company with over $50 billion in assets under management, be acting this way? People suspect it has something to do with Daniel Michalow. Last May, he was fired by DE Shaw as it was alleged he was being sexually inappropriate with women also working for this hedge fund. He rejects this accusation and says that he may be a complete dick at times but he is no pervert.

The thing is, Daniel Michalow has a non-compete agreement with DE Shaw that ends on September 16th of this year. What is the deadline for when this hedge fund’s employees must sign the new non-compete agreement? You guessed it, September 16th. DE Shaw claims this is a coincidence but that is one mighty big thing to believe.

Among other obvious things for why this claim is hard to believe, DE Shaw is known to be extremely focused on details. That they didn’t know a former managing partner’s non-compete agreement was ending on that day is pretty hard to believe. Additionally, if the allegations against Daniel Michalow are true, why would they be all that concerned that some employees may jump ship to join his new hedge fund?

It’s entirely possible that portfolio managers ticked off about being forced to sign a new non-compete agreement may very well decide to take their chances elsewhere. This could be joining other hedge funds or opening their own. Some sources say that DE Shaw’s leadership committee even asked MDs to swear a pledge of loyalty. This hedge fund’s nightmare scenario is that employees will leave to join Daniel Michalow even if he is an ass. This is especially true if some women make this leap.

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