UPDATE: Focus Liquidates Hedge Fund After $800M Loss

Mar 5 2008 | 12:01am ET

Focus Capital, the New York hedge fund battered by losses in its Swiss mid-cap portfolio, was forced to liquidate its portfolio last week after missing margin calls.

The firm told investors yesterday that it would likely close after losing about 80% of its value, or about $800 million, the Financial Times reports. Founders Tim O’Brien and Philippe Bubb blamed “violent short-selling by other market participants,” exacerbated by rumors that the fund was in trouble, for the losses.

In the letter to clients, Focus—which is not related to the British firm of the same name—said the collapse in the value of its investments led its two main banks to force it to sell assets. A spokesman for the firm described it as an “avalanche.”

The fund, which had enjoyed double- and triple-digit returns in its first three years, had lost 8.6% in January. It opened February with some $1 billion in assets.

RELATED ARTICLE:

Focus Capital Likely To Liquidate Fund After Losses


In Depth

OmniQuest Capital: Why Funds of Hedge Funds Work

Aug 11 2016 | 4:47pm ET

There have been few sectors of the alternative investment universe under as much...

Lifestyle

Kiawah: Island Reversal

Aug 24 2016 | 9:59pm ET

Looking for real estate investments but the typical real estate fare isn’t cutting...

Guest Contributor

Old Hill Partners: Embrace Illiquidity

Aug 9 2016 | 2:39pm ET

The age-old financial concept that higher yields are the result of higher risk and...