Sun, Jul 5, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Volatile currencies caused significant losses for larger hedge funds

Thursday, May 26, 2011
Opalesque Industry Update – Since the beginning of 2011, some of the largest hedge funds on a global scale have lost money from volatile currencies.

A report by The Wall Street Journal identified the hedge funds as the $2.5bn fund managed by Geraldine Sundstrom for Brevan Howard Asset Management LLP, an $8bn fund run by hedge-fund giant Tudor Investment Corp.; Caxton Associates' $5bn Global Investment Ltd. fund; and New York-based Moore Capital Management's $7.5bn Moore Global Investors fund.

Ron DiRusso, portfolio manager at the $8bn New York based currencies hedge fund FX Concepts told The Journal, "It's been a tough environment. The market goes in one direction for about three weeks, and everyone goes after it, and then it flips around. That's hurting people."

An independent study released by hedge fund data provider Hedge Fund Research showed that macroeconomics funds, which bets on currencies and global events, posted a negative 0.8% returns as at end May 19, 2010. For May, macro funds retreated 3.18%, HFR added.

The negative performance of currencies is a result of a decline in the global financial markets. But insiders are still unsure if the current debt problem in Europe and the perceived slow down in global economies will wipe off the gain in the past two years. Many believe that the uncertainties in the global economy are pushing currencies down. Data from HSBC also showed that Brevan Howard's Emerging Market Strategies Fund Ltd. declined 4.2% as of May 6, are posting a 2.7% negative growth as of Feb. 11. The Tudor B.V.I. Global Fund Ltd., managed by Paul Tudor Jones also fell 0.3% as of May 13 after registering a 1.9% rise on March 9.

Andrew E. Law’s Caxton Global Investment Ltd. fell 3% as of May 17 after registering a 0.5% loss on March 8.

Meanwhile, Moore Capital's flagship Moore Global Investments fund, run by Louis Bacon, was down 1.4% as of May 5, according to a source familiar with the fund. The firm's $3.8 billion Macro Managers Fund had lost 0.7% and one of Moore Capital portfolio manager Greg Coffey's funds deepened its losses from 4.1% on Feb. 28 to 5.8% as of May 5. The majority of foreign-exchange traded funds have been experiencing lows for the past several months as the Euro fell 6.5% against the U.S. dollar between May 4 and May 23. The rise of the Japanese yen by 4.6% immediately after the powerful Mach 11 earthquake and tsunami also spelled bad returns for the strategy.
- Precy Dumlao

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: New systematic strategy managed alongside research firm outperforms S&P500[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: An emerging CTA manager explains how he runs his strategy, which is based on an index produced by a research firm. Peter Turk is head of

  2. Opalesque Exclusive: New systematic strategy embraces machine learning[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: The founder of a New York-based systematic trading firm, which offers a hybrid between alpha strategies and alternative feta at lower fees, describes his approa

  3. Larry Robbins' hedge fund Glenview buys 1m Tenet Healthcare shares[more]

    Komfie Manalo, Opalesque Asia: Glenview Capital Management said it bought an additional 979,482 shares at Tenet Healthcare Corp valued at $53.80 million, raising its stakes in the healthcare services company to 15.16%, reported

  4. Legal - Grayson’s hedge funds under scrutiny for possible ethics violations, Court rejects hedge fund’s motion to block merger of Samsung affiliates[more]

    Grayson’s hedge funds under scrutiny for possible ethics violations From Freebeacon.com: Rep. Alan Grayson is finding himself in hot water over managing hedge funds that bear his name, actions that are in possible violation of House ethics rules. Sitting members of Congress are prohibite

  5. Hedge funds decline in June as stocks tumble on Greek woes[more]

    From Bloomberg.com: Hedge funds posted losses across strategies last month as uncertainty over whether Greece will remain in the euro sent global stock markets tumbling. Winton Capital Management declined about 3.1 percent in June in its $12.1 billion Winton Futures Fund, leaving it down 1.9 percent

 

banner