Greek Hedge Fund Up 40% In Just Three Months

Jan 17 2013 | 1:45pm ET

A new hedge fund betting that Greece had hit rock bottom has been spectacularly rewarded for its faith in the troubled country.

Dromeus Capital isn't the only hedge fund to make a killing on Greek long bets; Falcon Edge Capital, GSO Capital Partners, Perry Capital and York Capital Management have all done so, and Third Point's big bet on Greek sovereign debt earned it a tidy 100% return and contributed to its 21% return this year.

But since Dromeus new Greek Advantage Fund, which raised about €200 million, invests exclusively in Greece, its returns have been even more dramatic: The fund rose more than 40% during its first three months of operation, through December, the Financial Times reports.

The new fund began trading in October, with Dromeus CEO Achilles Risvas calling the bottom of the Greek market. His thesis was that Greek stocks and debt had been so beaten down during the financial crisis that they had nowhere to go but up. Dromeus is sticking by that story into the new year.

"We remain strong believers for further repricing in Greek fixed income and selected equity assets," Dromeus wrote to clients.

Still, the firm warned that there remains tremendous uncertainty in Greece, especially political uncertainty. But Dromeus said it was taking those risks into account and selecting its investments carefully.


In Depth

OmniQuest Capital: Why Funds of Hedge Funds Work

Aug 11 2016 | 4:47pm ET

There have been few sectors of the alternative investment universe under as much...

Lifestyle

Vortic: Making Great American Watches Again

Jul 25 2016 | 6:29pm ET

If you are compelled by stories of entrepreneurial vision & drive, or simply...

Guest Contributor

Old Hill Partners: Embrace Illiquidity

Aug 9 2016 | 2:39pm ET

The age-old financial concept that higher yields are the result of higher risk and...