U.S. Head of Vega Hedge Fund to Retire

Jon Berg, the U.S. chief executive at $7 billion hedge fund Vega Asset Management, is retiring.

Since there's no formal chief executive at the Madrid-based parent, Ravinder Mehra, Vega's chairman and chief investment officer and the investment brain of the organization, will now effectively run the company.

Berg's functions in the U.S. will be assumed by Michael Mann, currently global head of marketing for Vega. Mann said in a statement: "Jon is one of our industry's innovators, having grown Vega's operations not only in size but also in scope. He has helped us navigate some of the trickiest markets, always with an eye toward providing the best returns for our investors. ... He leaves our organization in a very strong and enviable position."

That the lead U.S. marketer will replace Berg as head of the U.S. business may point to Vega's effort to repair its image after a lackluster performance last year. The giant hedge fund started 2005 with $11 billion and ended it with $7 billion. Vega Select Opportunities Fund, a fund that invests in bonds, currencies and equity indices, had a negative performance of 9% last year. The global macro fund, Vega Global Fund, returned 1.5%. (Global macro strategies make bets using stocks, bonds or currencies, based on macro-economic views.)

Mehra, however, is considered one of the best hedge fund traders ever. He has reported just one down year in 26. In addition, Vega Select, despite its poor performance last year, has posted a 20% return since its inception in 2000. And Vega Global's performance was positive 9% since its inception in 1996.

Berg declined to comment other than to say in a statement: "This has been a great experience for me both personally and professionally, and I look forward to the next phase of my life." A person close to Vega said that Berg is not planning to launch a new fund but simply has personal plans to spend more time with his family and travel. Mann declined to comment.