Hugh Hendry’s bad luck in his Eclectica hedge fund this year ended in May. The Eclectica Absolute Macro Fund finished last month with a slight gain of 0.3%, bringing the YTD return to -9.3%, according to a letter to investors reviewed by ValueWalk. On the brighter side, June returns are better than the fund’s performance in May, with the fund up approximately 0.6%, according to information from the hedge fund’s website. Below readers can find commentary from Hugh Hendry followed by the full letter.

Also see Hugh Hendry Has Another Down Month As Nikkei Calls Fall

Hugh Hendry’s CF Eclectica Absolute Macro Fund performance for May 31, 2014.

Hugh Hendry's CF Eclectica

Hugh Hendry’s CF Eclectica: Performance Summary

  • The Fund generated a +0.3% return in May, with modest gains across four out of five themes.
  • The largest positive contribution came from the Fund’s Idiosyncratic trading strategies. A position in the US 30 year bond was the biggest single contributor as yields continued to fall on mixed economic data and a long position in the Indian rupee benefited from the post-election rally.
  • Within the Long DM theme, holdings in internet companies recovered some of April’s losses and further gains came from our European pharmaceutical stocks. Small losses were incurred on European option packages.
  • A recovery in Japanese equities resulted in a small gain for the Fund’s Long Japan theme, driven by holdings in property companies and brokers.
  • Elsewhere, positive price action in Chinese equity markets led to small losses on relative value positioning in private companies vs State Owned Enterprises and the Short EM theme saw further profits from our ‘good versus bad’ EM FX trade.

Full letter below

EAMF1405 Hugh Hendry