Niederhoffer's Second Act Has Plot Twist

The May selloff in stocks couldn't have come at a worse time for hedge fund manager Victor Niederhoffer, who's been working hard to put his infamous 1990s boom-to-bust story behind him.

In May, Niederhoffer's four-year-old Matador Fund posted one of its worst months ever, industry sources say. The fund, which specializes in trading stock futures and stock index futures, lost nearly 29% as the U.S. markets began to unravel, reducing the value of Matador's holdings to about $247 million.

As of the end of May, the so-called commodity trading adviser fund, which was once up 31% for the year, was 6% in the red since the end of December. Results for June, which is shaping up as another harsh month for investors, could not be determined. ...