Since the inception of Modern Trader, a core editorial theme has centered on the wisdom and power of crowds. Editorial emphasis has focused on companies and projects engaged in the collection and analysis of information.
Sunday, 11 December 2016
Last updated 1 day ago
Jul 22 2014 | 2:26pm ET
Hedge fund Balestra Capital Partners lost 14% in the first half—and that’s not even half of its problem.
The New York-based macro shop lost more than 60% of its assets to investor redemptions in the second quarter, The Wall Street Journal reports. The withdrawals totaled more than $600 million.
Balestra’s flagship hedge fund now manages less than $400 million, down from about $2 billion two years ago.
“We’ve had periods in our history where we understanding things going on, and see things happening and even make some good projections,” firm founder James Melcher told the Journal. “This is not one of those times.”
Balstra returned 200% in 2007 and nearly 50% in 2008. But the firm has struggled since then, a period of underperformance that Melcher called “unacceptable.”
Balestra has “made some changes,” including the departure of Melcher’s two partners last month. “It’s easier to make judgments in hindsight,” he said.