$7 Billion Goldman Hedge Fund Down 15.5%

Nov 4 2008 | 1:36am ET

Goldman Sachs’ first stock-picking hedge fund isn’t faring any better than its flagship quantitative offerings.

Goldman Sachs Investment Partners, which debuted in January with about $7 billion, making it one of the largest hedge fund launches in history, has lost almost $1 billion of that since then. The fund lost 13% during the third quarter, leaving it down 15.5% on the year, the Financial Times reports. That amounts to a $989 million loss.

“We are disappointed with our performance,” managers Raanan Agus and Kenneth Eberts, told investors. “GSIP is not alone in producing disappointing returns this quarter and this year.”

Agus served as global head of proprietary trading at Goldman before launching GSIP. Eberts headed the firm’s U.S. prop trading desk.

Most of the fund’s third-quarter decline is attributable to its commodities, basic materials, metals, mining, energy and agriculture bets. But it also posted “abysmal” returns in its convertible bond portfolio.

On the bright side for Agus and Eberts, the 10-month-old fund has a two-year lockup, meaning that GSIP is in no danger of the huge redemptions ravaging much of the hedge fund industry.


In Depth

Q&A: TCA Fund Management's Bob Press on Small-Cap Private Equity

Aug 25 2016 | 8:55pm ET

The emergence of private credit as a replacement for traditional bank financing...

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...