The sudden passing of Christopher Callahan, founder of Toronto’s Traynor Ridge Capital Inc., has triggered an in-depth review of the hedge fund’s considerable recent losses. The Ontario Securities Commission (OSC) suspended all trades by Traynor Ridge pending a thorough investigation. The fund’s trading missteps earlier in the month resulted in substantial losses, approximated between C$85 million to C$95 million, as detailed in an OSC report dated Oct. 30.
Market maker Virtu Financial Inc. has disclosed over C$5 million in losses linked to unsettled buy orders from the fund. Although Callahan had agreed to resolve these trades, no subsequent actions were taken. Andrew Smith, a representative from Virtu, emphasized their collaboration with regulators and Traynor Ridge to address these irregularities, offering condolences to the Traynor team during these testing times.
Another affected entity, Toronto’s Westcourt Capital Corp., has a significant stake in Traynor Ridge funds. David Kaufman, Chair and co-CEO of Westcourt, however, abstained from commenting on Traynor Ridge‘s operational strategies.
The OSC has expressed the urgent need for a comprehensive review of Traynor‘s financial situation. Callahan’s swift ascent in the finance world saw him at the helm of his firm by 2020, focusing on market discrepancies in publicly traded securities. Initially invested in special purpose acquisition entities, the fund gradually shifted to trading in convertible securities and cannabis shares, including Curaleaf Holdings Inc. and Cresco Labs Inc. However, October witnessed significant dips in these stocks.
