Clarium Sinks In Sept. As Rough Years Continue

Sep 28 2009 | 12:04pm ET

The financial crisis has been hard on a lot of hedge funds, but none more so than Clarium Capital Management.

The New York-based hedge fund, led by PayPal co-founder Peter Thiel, got off to a strong start last year. But since last summer, when the world economy teetered on the brink, the fund’s losses have continued to mount, even as many hedge funds have enjoyed big turnarounds this year.

Clarium’s run of bad luck continued this month, as the hedge fund shed 8% in the first 14 trading days of September, MarketWatch reports. That leaves the fund down 15.6% through Sept. 18, a loss roughly equal to the average gain posted by hedge funds this year. Clarium lost 4.5% in 2008, less than most hedge funds thanks in no small part to its 24% January return.

Much of the fund’s loss this month can probably be blamed on its effort to slash leverage. Clarium’s leverage fell to 1.4 times assets from 4.2 times between Sept. 11 and Sept. 19.

The long string of losses has taken a toll on the hedge fund’s asset base. The firm managed more than $7 billion little more than a year ago; now, it boasts less than $2 billion.


In Depth

GSAM’s Papagiannis on Liquid Alternatives

May 25 2016 | 5:07pm ET

The popularity of liquid alternatives strategies has blossomed in recent years,...

Lifestyle

From Modern Trader: Stephen Curry is a Black Swan

May 18 2016 | 7:43pm ET

What do the rise of the Internet, the sinking of the Titanic, 9/11, and Stephen...

Guest Contributor

LendingClub and the Question of Internal Hedge Funds

May 19 2016 | 8:42pm ET

Peer-to-peer lending platform LendingClub Corp. has been in the news since the firm...