Stark To Shutter Flagship, Two Other Hedge Funds

Jun 29 2012 | 1:30pm ET

Stark Investments will close three of its hedge funds, including its flagship, as its assets under management dwindle.

The Wisconsin firm said a "meaningful reduction" in the assets of its Shepherd Investments International, Shepherd Guardian and Stark Investments funds led to the decision. Stark informed investors by letter on Tuesday, Pensions & Investments reports.

"Despite strong performance in our multistrategy funds this year, which are up between 5% and 6% year-to-date, it has become apparent to us that the financial markets have changed systematically over the past few years," Brian Stark and Michael Roth, the firm's co-founders, wrote. "As a result it has become increasingly challenging for multistrategy funds to deliver to their investors the types of attractive returns with low volatility and limited downside exposure which multistrategy funds have traditionally delivered.

Stark's assets, once as high at $14 billion, have fallen precipitously in recent years. The firm managed $2.4 billion as recently as March, including $1.8 billion in the Shepherd funds, but now manages less than $1 billion, in spite of the launch of its new Mortgage Opportunities Fund in April.

That fund and Stark's ABS Opportunities Fund will remain open. Both have "performed well," Stark and Roth wrote, although their size is unclear; Stark reportedly raised $100 million for the fund and hopes to increase that total to as much as $300 million.


In Depth

Q&A: Open Season For Closed-End Funds

Aug 29 2014 | 10:00am ET

When Maury Fertig and Bob Huffman, former Salomon Brothers coworkers, launched...

Lifestyle

Och Funds Women In Finance Initiative At U-M

Aug 28 2014 | 3:01pm ET

Och-Ziff Capital founder Daniel Och and his wife have made a "generous donation"...

Guest Contributor

Looking Ahead: What’s In Store For Managed Futures?

Aug 22 2014 | 12:52pm ET

The last five years were phenomenal for investors in equity indices. Will the next...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

July/August 2014 Cover

The time was right

Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.