Among the sea of hedge funds which went under in June, there are a few admirable ones who managed to stay afloat. June marked the period which broke a seven month streak of positive returns as all regional and strategy hedge fund indices dipped low. Remarkably the only regional hedge fund index that stayed up was EurekaHedge Japan Index, which added a +0.15 percent gain in last month.
Hedge Funds Gaining in June: Tudor, Citadel, SAC Capital
Speaking of hedge funds that took gains in June, Caxton Associates added a 2.25 percent profit in its global macro strategy, Caxton Global Investments. The fund is up 16 percent YTD, as per II Alpha’s Stephen Taub. However, Caxton’s collaboration with Lyxor Asset Management in the form of index fund Lyxor/Caxton Hawk did not return as well, down 3.3 percent in June. The UCITS platform is an EM focused CTA.
Losses of Tudor Tensor Fund have recieved a lot of media coverage, Paul Tudor did much better in his other larger macro funds. Tudor B.V.I Global Fund added a 0.5 percent gain till June 28 while Tudor Discretionary Macro took a +0.9 percent return in June, the funds are 12 and 16 percent YTD respectively.
SAC Capital posted a 1.5 percent gain in June, amid intense insider trading investigations. Steve Cohen is up 8.25 percent in one of SAC’s main funds, according to Reuters’ Katya Wachtel and Matt Goldstein. Citadel Advsiors also did well in its Kensington and Wellington funds, adding a 1.3 percent return last month. The fund gained from its energy, fixed income and equity holdings.
Two Sigma Investments’ funds did well, Two Sigma Compass Cayman was up 3.6 percent, Two Sigma Absolute Return added 2.4 percent while Two Sigma Horizon was up 0.37 percent in June.
David Tepper’s Appaloosa Management also posted a good return in Q2. The $5.8 billion Palomino fund was up 7 percent in Q2, however there is no confirmation on whether Palomino was up specifically in June or not. The fund has gained 17.4 percent in the year so far and was up 3.6 percent in April. (Update: Palomino was down in June, the fund lost 2.4 percent )
The list of unscathed hedge funds also includes R.G.Niederhoffer whose flagship program netted a gain of +2.9 percent through June 21, bringing YTD gains to +30 percent. The fund has over $530 million under management and is designed to do well in volatile market conditions. Niederhoffer has done well in its fixed income and forex trades.
Rubicon Global takes the prize with the highest gain, the macro fund returned +5.17 percent return in June, bringing YTD return to 25 percent. Omni Macro Fund added a 1.5 percent gain through June 21, the fund had short EURUSD and short AUD positions in May. Hutchin Hill Capital also managed to stay up with a +0.1 percent return in June, Neil Chriss’ Multi strategy fund is up 10.1 percent YTD.
Short Positions Working For L/S Equity Hedge Funds
Other than the profitable names among macro strategy, some long/short equity funds also managed to stay on top. Unsurprisingly Odey Asset Management’s Absolute Return Fund added another 1.13 percent in June, taking year to date gains to +23 percent. The fund manages $800 million and took gains in its short positions and bond holdings. As of Q1, the Absolute Return fund had shorts in US 10yr treasuries and UK’s Gilt futures. The top equity holdings of the fund were in Regus PLC (LON:RGU) and Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B) and shorts were in China National Building Material Co. Ltd (HKG:3323) and Newcrest Mining Limited (ASX:NCM) (TSE:NM).
Lansdowne Partners’ Lansdowne Developed Markets Fund added a hefty gain of 3.9 percent in June, and the fund is up 17.3 percent for the year. We have covered Lansdowne’s shorts in mining, oil & gas explorers and other equities in detail, the fund apparently profited from its bearish calls in these equities. The theme of performing well in short portfolios, as in the case of Odey and Lansdowne, is a first, as hedge funds have consistently lagged in their short book throughout the year. A while ago we predicted that as markets take a reverse course, it could be finally time for shorts to start doing well.
John Burbank’s Passport Global returned 1.9 percent in June, fund is up 11 percent YTD. Tiger Cub Hound Partners, added a 0.5 percent gain in June, the fund is up 14.5 percent YTD. The fund is managed by Jonathan Auerbach and uses is a L/S equity strategy.
Another London based fund, Horseman Capital’s Horseman Global Fund, was up 3.79 percent in June, bringing YTD return to +17 percent. Like Lansdowne, the fund also took profits by shorting metals and mining stocks.
See more June data from the latest edition of HSBC hedge weekly embedded below