Philip Richards stepped down on Thursday as chief executive of RAB Capital to focus on running the Aim-listed company’s biggest hedge fund, saying it was “too onerous” to manage the company as well as the fund amid the market turmoil.

The Special Situations fund run by Mr Richards, the ‘R’ in RAB, fell 37.5 per cent in the year to August 21, hurt by its investments in small companies. The fund was the second-biggest shareholder in Northern Rock when the bank was nationalised and is working with SRM Global, a Monaco-based hedge fund, on a legal challenge.