RAB Capital is mulling a share buyback in an effort to cut the discount on its largest hedge fund.

The firm is considering a repurchase of ordinary shares which it would either hold or cancel, it said in a statement. US$1.5 billion RAB Special Situations, which is listed in London, trades at a discount of roughly 37% to net asset value.

The fund has been battered by its investments in small natural resource companies and in U.K. mortgage lender Northern Rock, which was nationalized in February. The fund is down by about one-third of its value—mostly due to the natural resource companies holdings—but shares of RAB Special Situations have fallen by 51%.

In the statement, RAB called its 8.18% stake in Northern Rock “regrettable,” but argued that the collapse in commodity prices is an overreaction.

“We believe this bearishness is hugely overdone,” RAB CEO Philip Richards, who manages the Special Situations fund, said. “In recent years we have made returns more quickly than this, and we believe that we will be able to do so again as the world runs short of natural resources.”