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Monday, November 10, 2008

Nobel Laureate's Fund Halts Withdrawals; Value Drops 29% in First Half of October

Platinum Grove Asset Management, the hedge-fund firm co-founded by Nobel laureate Myron Scholes, temporarily stopped investor withdrawals from its biggest fund after it lost 29 percent in the first half of October.

The decline left Platinum Grove Contingent Master Fund with a 38 percent loss this year through Oct. 15, according to investors. Funds that use a similar approach of exploiting differences in the value of related securities fell 14 percent last month and 30 percent this year, according to data compiled by Chicago-based Hedge Fund Research.

"The suspension is necessary given current market conditions," Platinum Grove said in an e-mailed statement Friday.

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