Monday, 28 July 2014
Last updated 9 min ago
Jul 13 2012 | 12:51pm ET
Add Trafalgar Asset Managers co-founder Lee Robinson to the list of hedge fund managers badly burned by last month's market rally.
Robinson's Altana Wealth, which only recently began taking outside capital, took a beating in June. The Monaco-based firm, which Goldman Sachs took an equity stake in earlier this year, saw its Distressed Assets Fund lose 7.27% on the month and its Inflation Trends Fund 5.34%.
Both funds, which debuted in November, were down double-digits in the first half, with the Distressed Fund out 15.51% and the Trends fund 11.25%.
Robinson said that Altana's short bets were to blame, telling investors that a substantial chunk of the loss was suffered on a hedge on Spain's main stock index—a hedge that Robinson increased after the Ibex rallied 10%, only to see it rally a further 10%. Altana's commodity shorts did no better.
"Our short positions sustained heavy losses, particularly in metals and energy markets as prices soared there," Robinson wrote. "Gold rose nearly 3.5%, silver over 5%, platinum 4.5% and copper 4.95%. Still more painful were losses on energy as crude oil soared over 9%."
"Obviously, we are disappointed with the short-term performance of the funds," Robinson, who seeded them with US$30 million, told Financial News. "Regarding the Distressed fund, we continue to believe that stocks will be lower later this year and that for the patient, bargains will be bountiful, allowing significant longer-term gains."
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…