How prominent funds have tackled the recovery from the crunch
Henderson European Absolute Return
Henderson’s $80m (€53m) equities hedge fund made 114.3% by the end of September, investors said. Manager Stephen Peak had to make 66% to recover from losses last year, but his fund is 26% above its June 2007 level. Peak said the second half of 2008 was the nadir of 34 years in finance: “I got a number of things totally wrong, it was a tough time. Things have distinctly improved this year.” The fund made 12% in August, as Peak bought stocks at depressed prices and partook in equity placings.
Perry Partners International
Perry Capital’s $6.2bn activist fund is 3% above its position before the crunch. It lost 25% last year, investors said. In February, manager Richard Perry halved the 20% variable fee in return for charging it immediately, until the fund recoups 2.5 times the losses of its last fiscal year. Investors still get the cut rate. Damien Loveday, global head of hedge fund research at investment consultancy Watson Wyatt, said this structure made sense: “The manager earns decent fees and the client gets a lower incentive fee.” Perry did not return calls.
RAB Special Situations
RAB Capital’s $501m flagship fund made 8.6% this year. It lost 73% last year as markets it focused on evaporated and its investment fell in value. A year ago, manager Philip Richards cut its incentive and base fees so investors would stay invested until September 2011. Gains this year, made as markets recovered and Richards rebalanced Special Situations towards more liquid investments, still left it 70% off where it was before the crunch. RAB’s Pi Asia and Cross Europe have recovered all their lost ground, investors said. RAB declined to comment.
CQS Fund
Michael Hintze, manager of the CQS fund, which primarily follows a convertible arbitrage strategy, made 22.8% by the end of September, but it lags its pre-crunch value by 16%. Investors said it lost 32% last year but met all redemptions, unlike many rivals. Its peers are up overall by 2.3% above June 2007 levels after making 53% this year. Deepak Gurnani, Investcorp head of hedge funds, said half as much leverage was needed as before the crisis to make better returns. CQS’ four other hedge funds are above June 2007 levels. CQS declined to comment.
del.icio.us
Digg
Newsvine
reddit
StumbleUpon