A massive hedge fund that shut itself to outsiders is crushing it

Billionaire Michael Platt decided to close his hedge fund firm BlueCrest Capital Management last year as investors pulled out.

BlueCrest now focuses on managing Platt's fortune - and has had a huge year, returning 40%, according to a Bloomberg News report.

The firm decided to trade with high levels of leverage, or borrowed money, Bloomberg reported.

Last year, the then-$9 billion firm received a wave of redemptions from big investors like pensions and endowments as performance wavered.

From January 2012 through January 2015, the flagship fund "performed poorly with an annualized return of 0.65% net of fees," according to a consultant report for Employees' Retirement System of Rhode Island.

"It is no longer a particularly profitable business to run a multi-manager hedge fund on 2 and 20 per cent fees," Platt told the Financial Times last year. "Instead we are happy to be our own client and run our own amount of leverage. We are going from earning 2 and 20 on clients' money to earning 0 and 100 on our own."

The firm had also drew criticism for an internal fund that managed employees' money, and produced higher returns than the fund for outside investors. That arrangement was said to be under SEC investigation as of earlier this year, Bloomberg reported.