Hedge Fund OMG To Close Due To Market Environment

Nov 21 2012 | 11:38am ET

Another hedge fund is calling it quits and blaming a frustrating market for it.

OMG Capital will return its US$230 million to investors. Nick Gaze, its chief operating officer, told Financial News that in the "brave new world out there," it simply can't make money.

"We haven't had the liquidity. We can't look investors in the eye and tell them that the market conditions will be conducive to making money any time soon," he said. "We're shutting down from an integrity point of view and a practicality point of view. Our strategy doesn't work in the current environment."

London-based OMG debuted in 2004 and ran a long/short large- and mega-cap stock strategy. The fund peaked at US$930 million in assets in 2009.

The "risk-on/risk-off" market has taken its toll on OMG's returns. After rising 12% in 2008 and 7% in 2009, it lost 3% in 2010 and another 3% last year. It is up just 0.2% this year.

OMG joins hundreds of other funds in throwing in the towel this year, among them former Goldman Sachs proprietary trading chief Pierre-Henri Flamand, who closed his two-year-old Edoma Capital earlier this month, complaining, "I don't think I can make money in this environment."


In Depth

Q&A: Brevan Howard’s Charlotte Valeur Talks Strategy

Sep 18 2014 | 11:18am ET

Charlotte Valeur chairs the board of Brevan Howard Credit Catalysts, an LSE listed...

Lifestyle

Hedgies Rock Out For Children's Charity

Sep 15 2014 | 8:40am ET

It's that time of year again—when hedgies trade in their spreadsheets for guitars...

Guest Contributor

Volkered: How Financial Sector Reforms are Creating Opportunities for Hedge Funds

Sep 16 2014 | 11:28am ET

New regulations have dramatically curtailed proprietary trading activity in investment...

 

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

September 2014 Cover

The London Whale: Rogue risk management

Credit default swaps brought down the London Whale and cost JPMorgan $6.2 billion. Here is how it happened.

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.