| Israel Englander, Millennium Management (Bloomberg) |
As additional hedge fund performance figures start to emerge, it looks like August was not as nightmarish for some hedge funds as it was for Greenlight Capital, which lost more than 6 percent, and Third Point, which lost more than 5 percent.
Several multistrategy funds that have already reported results either broke even for the month or made some money. For example, Israel (Izzy) Englander’s Millennium International, managed by his New York-based firm Millennium Management, was flat for the month and remains up 9.65 percent for the year. But an investor says the manager is not too happy with the results given that the fund was up leading into the final week or so of the month.
Another multistrategy fund, the $2.2 billion Visium Global Fund, was also flat last month and is up 7.5 percent for the year. It is managed by New York-based Visium Asset Management.
Donald Sussman’s Paloma Fund managed to squeeze out a 50-basis-point gain in August. As a result, the multistrategy fund, managed by Greenwich, Connecticut-based Paloma Partners, is now up between 6.5 percent and 7 percent for the year, according to a person familiar with the fund.
On the other hand, Daniel Och’s OZ Master Fund lost 2.84 percent in August, cutting its gains for the year to 1.86 percent, according to a regulatory filing. The fund’s manager, New York-based Och-Ziff Capital Management Group, is a publicly traded company. The firm’s OZ Asia Master Fund fell 3.81 percent for the month but is up 4.48 percent for the year, while its OZ Europe Master Fund lost 1.78 percent in August but is still up 6.13 percent for the year. The firm also reported that assets under management fell $400 million last month, to $46.1 billion, which accounts for performance and capital flows.
Among the long-short funds, Viking Global Equities, managed by O. Andreas Halvorsen’s Greenwich, Connecticut-based Viking Global Investors, lost only 2.1 percent in August. This reduces its gain for the year to 7.4 percent.
By contrast, its Viking Long Fund fell 6.5 percent last month — more in line with several activist funds, which resemble long-only funds — but is still up 4.1 percent for the year. This seems to suggest that Viking’s short positions fared very well last month, which is exactly what investors expect with their long-short funds.
This is a good thing, since a number of Viking’s largest long positions at the end of the second quarter did not fare well. For example, its largest long holding in both portfolios — global drugstore chain Walgreens Boots Alliance — lost 10 percent last month. The stock accounted for 6.4 percent of the assets of VGE and 6.5 percent of VLF.
China Mobile, Viking’s fourth-largest long holding, lost more than 7 percent, while Valeant Pharmaceuticals International plunged 10.5 percent in August. Meanwhile, Pioneer Natural Resources — another top-10 holding — fell 3 percent and is now down 27 percent since early May, when Greenlight’s David Einhorn singled out the hydraulic fracking company and its competitors as a short position at the Sohn Investment Conference.
The very small Seligman Tech Spectrum strategy fell just 1.44 percent in August and is up more than 2 percent for the year, according to an investor in the fund. Paul Wick has been running the strategy, which now has $360 million, from Menlo Park, California-based Seligman Investments since 2001. He also has run the Seligman Communications & Information mutual fund for a little more than 25 years.
