Titan Capital Group picked one of the worst months for hedge funds to make its move, soaring by double-digits—and erasing a double-digit loss—last month.
The firm’s $400 million flagship registered a 21% jump in May, pushing the fund’s year-to-date return to 7.9%, Dow Jones Newswires reports. It was a welcome turnaround for Titan, which had lost 11.7% in March and was down 4.5% last year, when the average hedge fund enjoyed a 20% return.
The average hedge fund dropped between 2% and 3% last month, and is up just over 1% on the year, according to several hedge fund indices.
Titan said the Global Return Fund benefitted from the wild volatility in May, with the fund earning “solid returns on mandatory convertibles as these positions are quite defensive and performed well with an increase in volatility.”
What's more, Titan said in a letter to investors that it is optimistic the good times will continue to roll.
“Longer-dated volatility, out to 10 years, is now higher than during the apex of the crisis in 2008/2009,” the firm said. “Shorter-dated volatility continues to be sold, increasing the likelihood that the market will remain volatile, as hedging these positions requires selling on down days and buying on up days. The portfolio should generate solid returns in the current market environment.”