Steve Cohen returns as beau of Wall Street ball

Steve Cohen is back as the beau of the Wall Street ball. The founder of Point72 Asset Management and defunct SAC Capital starred at Michael Milken's annual bash, warning global grandees that overcrowding in the hedge-fund world is lowering returns. It was one of his first public-speaking engagements since he settled a U.S. Securities and Exchange Commission case in January 2016. Cohen essentially dodged a bullet in the insider-trading probe of SAC Capital. The SEC barred him from managing client money until 2018 because he failed to supervise an employee convicted of illegal trades. An appeals court decision raising the standard of proof undermined the regulator's case, leaving Cohen relatively unscathed despite a $1.8 billion penalty against SAC. The billionaire has made an impressive comeback. In 2014, Cohen founded Point72, an $11 billion family office that mostly manages his fortune. He also recently formed – and indirectly owns – Stamford Harbor Capital, where he won't have a supervisory role. More from Breakingviews : Exxon Mobil reaches bottom of the oil barrel Attendees of the Milken Institute Global Conference eagerly awaited his presentation, packing the room and sending a line out the door. A hall pass was required for anyone who left the session and wanted to return. Cohen acknowledged that he is not immune to the hedge-fund downturn. In the first quarter of this year, the industry saw the largest outflow of investor money since the 2008 financial crisis. Point72 suffered an 8 percent drawdown in February, as markets turned volatile. Cohen said his "worst fears were realized." He blamed the trouble on too many hedge funds chasing the same strategies. Cohen said investors are nearing the end of a bull market, so expectations should be lower. The glum outlook didn't kill his mood, though, and he even joked about his unusual situation. When asked if he reports results to hedge-fund indexes, he replied: "I'm a family office. I don't know what you are talking about." The audience broke up laughing. He seemed relaxed and was the only male panelist not sporting a necktie. And his jovial mood seemed justified: U.S. watchdogs have left him bruised but unbowed. His Milken appearance showed he still knows how to work a room. For more independent commentary and analysis from Reuters Breakingviews, visit breakingviews.com

Steven Cohen

Adam Jeffery | CNBC

Steve Cohen is back as the beau of the Wall Street ball. The founder of Point72 Asset Management and defunct SAC Capital starred at Michael Milken's annual bash, warning global grandees that overcrowding in the hedge-fund world is lowering returns. It was one of his first public-speaking engagements since he settled a U.S. Securities and Exchange Commission case in January 2016.