Bruce Kovner, the billionaire co- founder of Caxton Associates LP, is retiring from the $10 billion hedge fund, ending a three-decade run.  Kovner was one of the first hedge-fund managers who sought to profit from macroeconomic trends by trading a variety of assets, including stock indexes, bonds, currencies and commodities and returned twice as much as the Standard & Poor’s 500 Index.  Andrew Law, chief investment officer, will take over from Kovner as chairman and chief executive officer on Jan. 1. Peter D’Angelo, 64, Caxton’s president and co-founder, will also retire.

Kovner is attempting a rare handover of power in the $2 trillion hedge-fund industry, where some of the most successful managers, including Stanley Druckenmiller and George Soros, chose to transform their firms into family offices rather than put another trader in charge. A family office usually oversees money for a wealthy individual and their relatives.

A one-time college instructor and New York City cab driver, Kovner opened Caxton in 1983, Among the best-known managers, only Druckenmiller, who turned his Duquesne Capital Management LLC into a family office in August 2010, and Soros, who followed suit this July with his New York-based Soros Fund Management LLC, had longer tenures at the helm of a macro fund.

Kovner’s main Caxton Global Investment fund has returned an average of 21 percent a year since inception, compared with an average gain of 11 percent including dividends by the Standard & Poor’s 500 Index. The $7 billion fund had one losing year, in 1994, when it fell 2.5 percent. Since 1983, the S&P has fallen in five calendar years, including a 37 percent decline in 2008.

The fund over its lifetime has produced cumulative net gains for investors of more than $12 billion, according to Kovner’s letter and an estimate by LCH Investment NV, a money manager based in Curacao. That ranks Caxton at seventh among the industry’s most-profitable funds. Soros Fund Management LLC tops the list with gains of $35 billion through the end of last year, according LCH.  [bloomberg 9/13/11]