| Brian Singer |
While investors, shocked by the Europe’s debt problems, have been busy selling European equities this year, Brian Singer remained bullish. The former chief investment officer for the Americas at UBS Global Asset Management, has positioned his macro hedge fund, Singer Partners, to profit from a resurgence in European stocks, and it appears he’s already being vindicated.
The Singer Partners Global Opportunity Fund returned 13.51% since its September 2009 inception through April 2010. During that period, the MSCI Europe Index gained 4.25%. This year through May 21, Singer is up 3.8%, while the MSCI Europe fell 18.4%.
The $138 million Singer Partners, based in Chicago, has been buying European equities for the past few weeks, and plans to increase its exposure in the flagship Singer Partners Global Opportunity Fund over the next few months.
“When the waters get rough, investors abandon fundamentals and tend to panic,” Singer said. “There is a lot of panic in Europe, and we don’t believe it warrants the decline in equity prices.”
Roughly 40% of the Global Opportunity fund is long equities. Of that, 16% is in Europe, 10% in the U.S. and 10% in the U.K., with the rest in various emerging markets and Japan. “If the price [of equities] rises, we’ll be happy to pull back,” he said. “But if the prices decline, we’ll add even more exposure to the portfolio.”
The fund is invested across a variety of sectors, including energy, industrials, and consumer cyclicals. The only sector Singer is avoiding is financials, where there is “a tremendous amount of regulatory uncertainty,” he said.
Singer is bearish on European debt, however, and is shorting the bonds of European nations. “The fiscal situation of sovereigns and municipals is really quite bad,” he said. He is also short five and 10-year U.S. government bonds.
At UBS, Singer managed the firm’s multi-asset and multi-currency team, which employed 125 and managed $240 billion. He joined UBS when it acquired asset management firm Brinson Partners in 1995, where Singer had been working as a senior analyst since 1990.
