Walleye Capital Lost 5.9% in October and Is Restructuring Its Equity Long/Short Business, Parting Ways With Leadership and Returning Capital:

Walleye Capital is restructuring its internal equity long/short business after a 5.9% loss in October, its worst month since March 2020, and plans to return a portion of capital to investors. According to a letter from chief executive and chief investment officer Will England, seen by Business Insider and reported by Hedgeweek and Investing.com, the roughly $17 billion multi-strategy firm is parting ways with Anil Gondi, who joined in July 2025 to lead the equity long/short unit after earlier roles at Balyasny Asset Management and 6elm Capital, along with a substantial share of the internal investment team. The amount, timing and mechanics of the capital return have not yet been disclosed; investors will hear later.

In the letter, England wrote that the firm had taken a hard look at every aspect of the business following the drawdown. He said the internal equity long/short book had been Walleye's weakest-performing strategy since 2023, substantially trailing its external long/short allocations. Efforts to improve the franchise, including bringing in new leadership, "did not produce the results we expected, and the opportunity cost and resources consumed have been too high relative to the return," he said.

Walleye is not exiting stock picking. Remaining internal teams will report directly to England, and the firm will continue allocating to external equity managers, seeding new long/short vehicles and retaining its highest-conviction internal portfolio managers. Partners Tom and Chris are stepping back into management of the external long/short business. England said the firm will lean harder into volatility, quantitative and external strategies where it believes it has a clearer edge; the volatility book posted its strongest month on record in October and is on track for its best year in dollar terms.

The shake-up follows the September departure of Matt Giannini, the equity unit's chief operating officer, who returned to Citadel. Walleye has also hired Anna Dev, formerly of Millennium, in a business-development role focused on third-party investment sourcing. Investing.com reported that as of midyear the firm held sizeable positions in AI-linked names including KLA, Micron, AMD and Applied Materials, amid a broader October technology selloff that hit multi-strategy peers.

For allocators, the letter frames a familiar multi-strategy choice: cut the underperforming internal sleeve, return capital to right-size the fund, and concentrate risk where the platform has already shown a differentiated P&L. Open questions include the size of the return, how much capacity remains for external and volatility sleeves, and whether October's technology reversal forces further capital reallocation across the peer set.