Hugh Hendry (the one time bear) who turned bullish, had some poor timing  (at least, in the very short time frame since the switch). Below is the latest commentary from a letter which Hugh Hendry sent to shareholders of Eclectica Asset Management.

  • January witnessed renewed turmoil in emerging market equities and currencies. The Fund profited from positions within our Short Emerging Markets and Short China themes (+0.9%).
  • FX positions within these themes generated a positive return of +0.3% as our “good versus bad EM” FX basket posted gains, largely driven by shorts against the Turkish lira and the Russian ruble. Equities provided an additional +1.4%, led by short exposure to Chinese and EM indices. These gains were partially offset by losses on curve steepeners in Australia and Korea, which were closed out during the month.


Hugh Hendry
Via January letter
  • Developed market equities suffered sharp sell-offs over the course of the month as emerging market woes spilled over into global risk assets. The Fund’s core Long Developed Markets theme suffered as a result (-2.0%). Developed market equities cost the fund -1.7%, led by weakness in internet and robotic stocks. Additional call option exposure to US and European indices cost a further -1.3%. Equity losses were partially offset by gains in front-end rates in the Euribor and Short Sterling curves, generating a positive contribution of +0.8%.


  • The largest detractor to performance came from our Long Japan theme (-3.0%). Losses on Nikkei call options were the single biggest drag on performance during January (-2.2%), as the underlying index fell -8.5%. Cash equity positions in Japanese brokers and property shares cost a further -0.8%.


See more here Hugh Hendry: “Want to make real money? Make it in Japan”