One year ago
»» Despite, or perhaps because of, its bearish outlook, Perry Capital had posted an 11.17% gain in its flagship multistrategy fund, Perry Partners International, through the end of September last year.
Perry was helped by shorting the debt of Japan, China and some European nations, as well as by having more than one-third of its portfolio in cash. The fund, headed by Richard Perry, ended the year up 16.20%. The fund has had a less profitable 2011, dropping six of the first nine months to fall 7.97% through the end of September, compared with a 0.04% loss for the AR Multistrategy Index.
Perry has reportedly cut 30 portfolio managers and analysts, and three partners, as well as shut down its Hong Kong office as part of what a recent investor letter termed a “strategic evaluation of our business.” A Perry spokeswoman referred all inquiries to general counsel Mike Neus, who did not respond to a request for comment.
See also:
Perry makes back 2008 losses, eyes debt
Perry’s generosity: Well, there’s a catch
»» Scott Roth’s Severn River Capital Management, the Greenwich, Conn., fund founded by two Navy veterans, outlined its return from an investor exodus in late 2005 that followed the firm’s decision to alter its strategy. The firm, which raised $750 million in three months during its initial fundraising, fell from 45 employees to four in 2005.
By last year, Severn River boasted nine employees and was managing $384 million. Once a multistrategy-arbitrage shop, the firm shifted to long/short equity and credit investments with a more concentrated portfolio. Strong returns followed, and the firm has not reported a negative year in the past six. The flagship fund has produced a net annualized return of 14.87% from April 2006 through September of 2011.
This year has dragged down that average slightly, with the fund having fallen 2.94% through the end of September, compared with a 6.49% slide for the AR U.S. Equity Index. Roth told AR recently that the woes of the financial industry have made it difficult to trade stocks in that sector. “There is no obvious way to make money on the banks—people who look at normalized earnings and tangible book are not accounting for the way the banks will look in the future,” he said. The firm did not respond to a request for comment.
Five years ago
»» Democrats mopped up the vast majority of political contributions from hedge funds in a midterm election year that witnessed the party capture control of the Senate, House of Representatives and a majority of governorships and state legislatures.
This year has been less lucrative for President Barack Obama’s party, with such former supporters as Dan Loeb of Third Point and Ken Griffin of Citadel turning away from the President. But others have stuck by him, including David Shaw, founder of D. E. Shaw & Co., and Orin Kramer of Boston Provident. Overall, hedge fund employees support Republicans over Democrats this year, with 60% of more than $4 million in 2012 campaign contributions going to Democrats, according to the Center for Responsive Politics.
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