London Whale Trade Boosts Hutchin Hill 2012 Returns

London Whale Trade Boosts Hutchin Hill 2012 Returns

Hutchin Hill Capital, famous for squeezing profits from the London Whale fiasco at the right time, was up 11.06 percent in its flagship Hutchin Hill Master Fund which is also called Diversified Alpha Multi-Strategy Fund. Hutchin Hill, the hedge fund run by Neil Chriss, uses six different approaches in the Master Fund.

Of these strategies, Opportunistic and Equity underperformed with a -0.33 and +0.4 percent return in last year. The best performing strategy was Sytematic and Quantative, up 3.6 percent.  The gains got a boost due to strong returns from the famous JPMorgan Chase & Co. (NYSE:JPM) “London Whale” trade.

Event and Special Situations gained 2.88 percent, Credit was up 2.78 percent while Macro gained 1.7 percent.

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david einhorn, reading, valuewalk, internet, investment research, Greenlight Capital, hedge funds, Greenlight Masters, famous hedge fund owners, big value investors, websites, books, reading financials, investment analysis, shortselling, investment conferences, shorting, short biasIt has not just been rough year for David Einhorn's own fund. Einhorn's Greenlight Masters fund of hedge funds was down 3% net for the first half of 2020, matching the S&P 500's return for those six months. In his August letter to investors, which was reviewed by ValueWalk, the Greenlight Masters team noted that Read More

The Master Fund gained 2.14 percent in December. The Credit strategy gained handsomely and incurred only small losses in short positions in iron ore sector. David Einhorn’s Greenlight Capital also lost in the same area in the last quarter. The fund’s quarterly commentary talks about the reversal of the losing trend in the housing market and the boom in online shopping which has made the sector of retail stores outdated. Hutchin Hill is bullish on U.S. auto OEMs, housing and is bearish on PC names, financials and European auto names and companies exposed to metal mining sector.

In the corporate credit long/short strategy, the master fund made gained from short position in a restaurant chain, long in Canadian bonds and a power generation company. The corporate credit portfolio detracted slightly from losses in a LIBOR trade. Overall HH’s investment thesis has a bullish bet on cash bonds which it believes will gain more strength due to the low supply of cash.

In the Event Driven strategy, HH profited from the change embracing mood that was dominant in the industry. In this regard, the fund mentions the growth in share price of Iron Mountain Incorporated (NYSE:IRM) with the announcement of structural changes in the firm, the spinoff of Marathon Petroleum Corp (NYSE:MPC)’s pipeline business and ADT Corp (NYSE:ADT)’s shares buyback program.

In the Quant portfolio, the fund gained from its positions in the tech and consumer discretionary sector thorugh its statistical arbitrage strategy. However in mean reversion strategy, HH lost in financials and consumer stocks in Korea and US while making small gains from Canada’s energy sector.

In Equities, the Master Fund profited in the US banking sector, credit cards sector while suffering losses from asset management companies and Canadian banks. The fund also gained from the merger of two exchanges, we guess this is a reference to  IntercontinentalExchange’s acquisition of NYSE Euronext in late December.

In the Macro space, December brought returns from debt trades in Argentina, Hungary and Venezuela which were offset by losses in Russia and Mexico. The Managed Futures strategy underperformed in December with losses from agriculture and equity futures. The Opportunistic portfolio was also down slightly in the last month of 2012.

Hutchin Hill’s investment team welcomed Deepa Sarkar and Kendra Walker from Highbridge Capital. Kimberly Steinberg joined Hutchin Hill as well, she has previously worker at Citadel, Highbridge and Black River.