36 South Moves Most Assets Into Volatility Investments

Sep 17 2013 | 2:04pm ET

36 South Capital Advisors is living up to its reputation as a volatility hedge fund.

The London-based firm has nearly doubled its volatility bets this year, and now has 90% of its US$626 million in assets in volatility plays on currencies, commodities and stocks, Bloomberg News reports. The firm is guessing that the longer quantitative easing goes on, the more spectacular market gyrations will be later.

"The central banks have been flooding the world with liquidity, which in a way confuses the pricing mechanism," 36 South founder Jerry Haworth said. "We got the feeling that the longer that it carries on, the subsequent volatility that will happen afterwards will be greater."

36 South's flagship Kohinoor volatility funds are down 2% this year.

"You buy a ticket to a life raft well before everyone else is clambering to get on," Haworth told Bloomberg. "When you have an opportunity to get a cheap ticket, you should buy it."

But that time is coming, Haworth said, noting that the small redemptions his firm saw last month are a possible harbinger.

"In a way, I've been looking forward to redemptions because they tell me that it's probably the last thing that happens before it turns."

In Depth

Related-Company Fees: Normal Industry Practice or Conflicted Compensation?

Nov 11 2015 | 4:23pm ET

Regulatory agencies as well as investors are increasingly exploring whether certain...


Ferrari Roars in Wall Street Debut

Oct 21 2015 | 4:28pm ET

Shares of supercar maker Ferrari jumped as much as 15 percent to a high of nearly...

Guest Contributor

Private Debt - What is the Opportunity?

Nov 11 2015 | 3:28pm ET

In this contributed article, Rob Allard, founding partner of Firebreak Capital...


Editor's Note

    Oct 21 2015 | 10:41am ET

    One of the most unique charity benefits in the hedge fund industry, A Leg To Stand On's (ALTSO's) Hedge Fund Rocktoberfest - NYC, raised nearly $500,000 last Thursday thanks to the generous support of major sponsors and nearly 1,400 attendees from the Tri-State finance, business and hedge fund communities. Read more…