Japan-Focused Hedge Fund Up Over 200%

Dec 2 2013 | 8:09am ET

Being bullish on Japan is paying off in a bid way for Hong Kong-based Northwest Investment Management.

The firm's Northwest Warrant Fund is up 203% through the end of October, Bloomberg News reports. The US$32 million owns almost US$500 million in convertible bonds, most of them in Japan, and has profited handsomely from the 50% jump in Japanese stocks this year, their best in more than 40 years.

Northwest manager George Philips bet big that the Bank of Japan's stimulus program would boost the country's share prices. The central bank has said it aims to reach a 2% inflation target in two years.

"It's still early days," Philips told Bloomberg. "If the 2% inflation target of the Bank of Japan is seen through, we would expect to see considerable corporate activities over time."

Northwest also successfully bet that the Japanese yen would weaken against the U.S. dollar.

This year's triple-digit returns are not Northwest's first: The firm returned 225% in 2009. But it had lost 89% the year before.


In Depth

Q&A: Decathlon Capital On Revenue-Based Alternative Lending

Oct 30 2017 | 3:49pm ET

The explosion in private credit activity since the end of the financial crisis is...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Saxby: Not All EBITDA Is Created Equal

Nov 30 2017 | 8:02pm ET

Record levels of dry powder are driving competition among private equity firms to...