Tuesday, 22 July 2014
Last updated 18 hours ago
Feb 15 2008 | 12:12pm ET
Hedge fund Saracen Energy Partners is denying that it is on the verge of becoming the next Amaranth Advisers after suffering hundreds of million in losses on natural gas trades.
The Houston-based firm acknowledged today that it lost as much as $400 million on spread trades on the March and April 2009 futures contracts, but published reports indicate that the loss could be twice that: as much as between $700 million and $800 million.
The March-April spread on the New York Mercantile Exchange soared more than 50% over the past week. The fund shorted the March contract and was long the April contract, and was forced to liquidate some positions.
Saracen reportedly said that its survival was not in danger, claiming it had sufficient liquidity to continue operating. It also batted down rumors that it was selling its trading book to a Goldman Sachs unit.
The March-April spread has already claimed one prominent victim. Amaranth collapsed after losing $6.5 billion on bad natural gas bets, including the March-April 2007 spread, when it went long March and short April.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…