Roy Niederhoffer

Investment Manager, Roy G. Niederhoffer

Roy Gary Niederhoffer (b. in 1966) is an American hedge fund manager and philanthropist. He founded R. G. Niederhoffer Capital Management, Inc. in 1993 and currently serves as President. The R. G. Niederhoffer Diversified Program is reported to have returned +60% in 2000, +51% in 2008, and overall have had long-term returns over +17% annualized return from 1999 through March 2009. His firm’s assets under management were reported to be $943 million as of August 2010.

Early life

Niederhoffer was raised in Great Neck, New York. His father, Arthur Niederhoffer (1917–1981) was a professor of Sociology at John Jay College of Criminal Justice, the author of several books on the police and criminology such as “Behind the Shield”, “The Ambivalent Force", and “The Police Family”, as well as a 20-year veteran of the New York City Police Department. His mother, Elaine Niederhoffer (1925–2006) was an English teacher, author, and editor.

At age 13, he and a classmate founded a company called Software Innovations, which sold computer games such as Alien Invasion for the TRS-80 microcomputer. In 1982, when Niederhoffer was 16, the firm changed its name to Microvations, Inc., soon thereafter employed over 30 people, mostly his classmates, and produced over 450 individual titles by 1983. Though the company closed when Niederhoffer left for college at Harvard, his interest in computers continued.

Education

Niederhoffer attended Great Neck South High School and Harvard College, from which he graduated magna cum laude in 1987 with a BA in Computational Neuroscience.

Career

Following university, Niederhoffer worked for his brother, hedge fund manager Victor Niederhoffer, from 1987 to 1992. Roy Niederhoffer left his brother’s firm in 1992, opening R. G. Niederhoffer Capital Management, Inc. in 1993.

Business and Trading Strategy

Niederhoffer employs an investment strategy known as short-term trading. Niederhoffer’s computerized trading models are able to profit from the presence of cognitive biases in the human brain, which cause investors and the models they create to behave predictably. His firm was noted for strong performance during the financial crisis of 2007-2010.

Awards

• The Roy G. Niederhoffer Negative Correlation Fund was the Absolute Return Managed Futures Fund of the Year in 2008, when it returned 55%, and the Diversified Fund Offshore was also nominated for its 2008 performance of 51%.

• The R. G. Niederhoffer Diversified Fund Offshore was the HFM Week Magazine Managed Futures Fund of the Year in 2008.

• R. G. Niederhoffer Capital Management, Inc. was Futures Magazine Top Trader of 2000.

• The R. G. Niederhoffer Diversified Fund Offshore was ranked #9 of the top 100 Hedge Funds by Barrons in 2009 and #42 in 2010.

Musical and Theatre Pursuits

Niederhoffer is a violinist with the Park Avenue Chamber Symphony, and has performed with them in such venues as Carnegie Hall, Avery Fisher Hall and Alice Tully Hall. He is also a classical and jazz pianist.

Niederhoffer is the Executive Producer of the Flying Karamazov Brothers which played Off-Broadway in 2010 and in London's West End in 2011.

Philanthropy

Niederhoffer is noted for his efforts to provide relief to victims of Hurricane Sandy. Beginning the week of the storm, he organized hundreds of volunteers and corporate donors including Fairway, Inc. and Exxel Outdoor Products who distributed tons of food, supplies, generators, and sleeping bags to residents of Rockaway, Queens and elsewhere.

Niederhoffer currently serves as Chairman of the Board of Directors of The Harmony Program, which provides music education to underserved New York City Public School students, and Concert Artists Guild, and has been on the board of the Kaufman Center (consisting of the Special Music School, Lucy Moses School and Merkin Concert Hall).

He also has created the Niederhoffer Foundation, which is active in music education, Jewish causes, and aid to the needy.

Niederhoffer is the Chairman of the Board of NYCO Renaissance, a group seeking to revive the New York City Opera.

Family

Niederhoffer is the brother of hedge fund manager Victor Niederhoffer and clinical psychologist Diane Klein, the son of sociology professor and author Arthur Niederhoffer and author Elaine Niederhoffer, and the uncle of director and author Galt Niederhoffer.