Natural Resource Fund Up 27%, Manager Predicts $75 A Barrel

Jan 19 2006 | 7:41pm ET

Garrett Smith, general partner at Dallas-based hedge fund firm Spinnerhawk Capital Management, which just passed its six-month-mark with net returns of 27.5%, has seen the highs and lows of the oil industry and expects crude to settle around $75 a barrel by year-end. According to Smith, Spinnerhawk’s fund has been taking in money each month since its inception in July, and now has $40 million in assets under management.

The fund, which aims to close at $250 million, invests in two asset classes, energy futures and publicly-traded energy stocks. “We devote approximately one-third of our portfolio to futures and the other two-thirds comes from equity,” Smith said. “Typically, I describe our competitive edge as industry experience,” said Smith, who began working on oil rigs as a teenager and later spent 17 years with BP Capital, where he worked with oil tycoon Boon Pickens.

“My own estimate is that we will likely see oil trade toward $75, which is where world-wide governmental bodies came and acted to stop prices from going up during the hurricane,” said Smith, referring to Katrina, which temporarily caused oil production to ground to a halt in parts of the Gulf of Mexico. “There was a long time where oil was not attractive; it was not something that hedge funds were made from,” he said.

“But today, things have changed and the markets are considerably tighter than they have been for many decades, and it has become an area that has generated price appreciation for the underlying commodity and the stock, so there is a lot of interest in it now.”  


In Depth

Will Liquid Alts’ Performance Sustain Future Asset Flows?

Aug 25 2014 | 10:34am ET

Liquid alternative investment funds saw the highest percentage of capital inflows...

Lifestyle

Hedgies, Economists and Musicians Mingle At Milkin Mixers In Hamptons

Aug 25 2014 | 6:00am ET

Leave it to Michael Milken to bring some gravitas and sweat to the Hamptons -- along...

Guest Contributor

Looking Ahead: What’s In Store For Managed Futures?

Aug 22 2014 | 12:52pm ET

The last five years were phenomenal for investors in equity indices. Will the next...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

July/August 2014 Cover

The time was right

Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.