Och-Ziff Flagship Nears High-Water Mark

Sep 2 2009 | 12:55pm ET

Investors in Och-Ziff Capital Management’s flagship hedge fund can rejoice: The fund has nearly recouped its losses from last year.

The OZ Master Fund returned 1.42% last month, leaving it up 17.06% through the first eight months of the year. That’s just fractions of a percentage point from returning to its high-water mark after losing 15.9% last year.

That’s certainly good news for the $21.7 billion New York hedge fund, and even better news for its investors. That’s because Och-Ziff’s policy is to reimpose performance fees a year after suffering annual losses, whether or not those losses have been made up. At this rate, OZ Master may begin charging incentive fees before the year is out.

Investors in Och-Ziff’s other hedge funds are not so lucky. Its OZ Asia Master Fund is up a strong 24.23% through August, but lost 30.9% last year. The firm’s Europe fund is up just 11.78% this year after dropping 17.4% last year, and its OZ Global Special Investments Master Fund has returned only 5.59% after losing 8.3% in 2008.

Still, investors seem buoyed by the firm’s performance: Och-Ziff said its assets under management rose $200 million in August, both through strong returns and new inflows.


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