Caxton Global Investments is the standout player in the macro world this year, gaining 16.89 percent through Nov. 12, according to HSBC’s weekly monitor of hedge fund performance.
Founded by Bruce Kovner, Caxton was one of the pioneer macro players, along with Paul Tudor Jones of Tudor Investment Corp. and Louis Bacon, of Moore Capital Management. All three started their careers at Commodities Corp., which became well-known in the 1980s for incubating hedge fund trading talent.
Caxton has far outperformed the others this year. Tudor’s BVI Global gained 9.6 percent through October, while Moore Capital’s funds have sputtered. Moore Global Investment lost 10 basis points through October, while Moore Macro Managers added a mere 1.9 percent.
Through Oct. 31, Hedge Fund Research’s macro index had risen 5.38 percent for the year.
The trajectory of the three pioneers is notable, as the macro strategy that fueled them to the top of the hedge fund world around the turn of the century has not worked so well in recent years.
Last week, Bacon told investors that he was returning capital to outside investors, and consolidating three of his funds into one. Though Bacon did not say he was retiring, he did say that the New York-based firm’s consolidated fund will continue “to trade and invest with the same line-up of portfolio managers, but with less participation from me.”
[II Deep Dive: Louis Bacon’s Moore Capital to Return Outside Capital]
Both Moore Global Investment and Moore Macro Managers lost money last year, following years of low single-digit gains, according to HSBC.
As for Jones, he laid off 15 percent of his staff three years ago, moved to from Greenwich to less expensive digs in Stamford, and consolidated his funds. Jones had already moved his tax domicile from Greenwich to Florida, and said he would take a greater role trading for the firm. Tudor gained more than 10 percent last year, according to HSBC.
Meanwhile, Caxton’s Kovner retired in 2011, turning over the reins to Andrew Law, who this year moved the firm’s headquarters to London, the Financial Times reported this summer.
While the move was viewed as a symbolic support of the beleaguered financial center as Brexit looms, the weak pound has also benefited Caxton, allowing it to cut its costs and recruit more heavily in London.
Caxton’s performance this year is a huge comeback from the losses of 2017, when it fell 13.17 percent to become one of the worst 20 hedge fund performers of the year, according to HSBC. Last year its main fund gained 3 percent. Since 1997, that fund has returned an annualized 10.75 percent.
All three hedge funds firms declined to comment.
