Komfie Manalo, Opalesque Asia:
The New Jersey-based Raging Capital Master Fund, managed by Raging Capital Management, posted its best monthly performance ever in July and gained 22.0% net of all fees and expenses on strong performance by Facebook, which is also its largest portfolio.
In his monthly commentary to investors, William C. Martin, Chairman and CIO at Raging Capital, said that Facebook accounted for over 80% of the hedge fund’s returns in July. Excluding Facebook, the balance of the portfolio gained approximately 500 basis points on a gross basis, comparable to the S&P 500’s 4.95% return.
"Anyone who uses FB, of which there are about 1.1 billion users, could have detected that News Feed advertising was becoming visually more prominent and engaging and that both ad loads and the volume of unique advertisers were rapidly increasing in the second quarter," Martin told investors and added, "All we did was match this observation against proprietary survey work, dozens of due diligence calls, and meetings with industry participants."
This is only the third time that the hedge fund "position- maxed" an idea. Raging Capital, he said, is not afraid of volatility, and will swing hard when the right pitches come along. However, maintaining prudent risk management and always living to play another day are immutable rules of the game.
In the later part of July, Facebook reported revenues of $1.8bn that exceeded early estimates by Wall Street by nearly $......................
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