Citadel and Peers Face More Scrutiny as Pod Shop Risks Grow (1)

Even Ken Griffin is a little worried.

Multimanager funds like Griffin’s Citadel have come to dominate the hedge fund industry, riding a steady run of outperformance to oversee more than $1 trillion, including a healthy dose of leverage. But the explosive growth has led the industry giants to pile into many of the same trades.

WATCH: Ken Griffin’s Citadel and other multimanagers are facing more scrutiny.

Source: Bloomberg

That has built unease among regulators, investors and traders over these so-called pod shops. And while Citadel’s billionaire founder has vocally opposed any notion that his firm and rivals pose systemic risks and need more regulation, even he acknowledges that crowded trades could lead ...