Reuters / Ruben Sprich
- Hedge fund managers including Ray Dalio and Adam Levinson suffered record losses in March as the novel coronavirus hammered their portfolios.
- Around 75% of hedge funds posted losses last month, including nine in 10 credit funds, Bloomberg estimated based on preliminary data.
- Dalio's Bridgewater Associates lost 16% in its flagship fund, Levinson's Graticule Asset Management recorded a 9% drop in its macro fund, and Michael Hintze's CQS Directional Opportunities Fund fell by a third, Bloomberg said.
- "Many funds are going to be throwing up gates and going into survival mode," one hedge fund chief told Bloomberg.
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Ray Dalio, Adam Levinson, and other hedge fund bosses posted record losses in March as the novel coronavirus pandemic tore through markets in what one fund manager called an "epically turbulent" month.
Around 75% of hedge funds stomached losses last month, including nine in 10 credit funds, according to a Bloomberg analysis of preliminary data. Equity hedge funds delivered their second-worst performance in at least three decades, Bloomberg reported, citing Hedge Fund Research data.
March was a "devastating" month for the industry, Ed Rogers, the boss of Rogers Investment Advisors in Tokyo, told Bloomberg. "Many funds are going to be throwing up gates and going into survival mode."
Bloomberg, relying on a mix of reporting and client letters, highlighted several funds' performances in March:
- Dalio's Bridgewater Associates, the world's biggest hedge fund with about $160 billion in assets, suffered a loss of roughly 16% in its flagship fund after wagering that markets would rise.
- Levinson's Graticule Asset Management registered a 9% drop in its macro fund as equity and fixed-income bets disappointed. In a letter to investors, Levinson described March as "epically turbulent."
- Michael Hintze's CQS Directional Opportunities Fund tumbled by a third, almost triple its previous record monthly decline. Another of its strategies, focused on asset-backed securities, lost more than 40%.
Other hedge funds had a much better month. Mark Spitznagel's "black swan" fund, Universa Investments, posted a return of more than 3000%, according to a client letter obtained by Business Insider.
Bill Ackman's Pershing Square posted an 11% gain in March after making a $2.6 billion gain on credit-default swaps that offset losses in its equity portfolio.
Ruffer, a London-based fund nicknamed "50 Cent," also racked up $2.6 billion last quarter by betting on volatility to spike and equities, credit, and gold prices to fall, again offsetting its losses elsewhere.