Tuesday, 21 October 2014
Last updated 9 hours ago
May 9 2011 | 1:33pm ET
Plummeting oil prices wiped out Clive Capital's year-to-date gains last week, leaving the world's largest commodity hedge fund almost 10% lighter than it had been at the beginning of the week.
The London-based firm, which has about US$5 billion in assets under management, told investors on Friday that it lost 8.9% last week, or more than US$400 million. Most of the losses came amidst what Clive called "extraordinary" price movements that it said it could not explain.
The five standard deviation daily move of Brent crude on Thursday "annihilated" the oil markets, Clive explained. But the hedge fund said it didn't understand why.
"Economic data were soft early in the week though micro news for oil continued to be bullish," the firm wrote. "Indeed, there was news out earlier in the week of further supply disruptions in Yemen and a substantial technical supply outage in" the United Arab Emirates.
The losses last week left Clive down year-to-date, but it isn't backing off its fundamental premise.
"Physical markets are quite strong," Clive said. "We remain positioned in a number of markets."
Clive wasn’t the only normally sure-footed commodities firm caught off-guard by last week's wild ride: Astenbeck Capital Management, the hedge fund led by former Citigroup star energy trader Andrew Hall, suffered a double-digit loss last week, the Financial Times reports.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Sep 30 2014 | 9:29am ET
The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…
Most traders agree that proper risk management is the key to successful trading. However, many traders depend on the deeply flawed measure of standard deviation as a benchmark of risk. Here we put it ...