Investors Flee Balestra As Performance Suffers

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.

In Depth

Financial Industry Blockchain Consortium R3 To Open-Source Platform Code

Oct 20 2016 | 9:03pm ET

Bitcoin's blockchain technology has spawned a flurry of activity among fintech startups...


U.S. Trust's Beard: The Rapid Growth of the Art Lending Industry

Oct 7 2016 | 10:55pm ET

Alternative investment managers have emerged as some of the most significant art...

Guest Contributor

Hedge Fund Marketing – Tips for Your Initial Sales Meeting

Sep 29 2016 | 5:46pm ET

There are two main goals a hedge fund should have for an initial in-person sales...