Summary List Placement
March was not pleasant for many hedge funds.
Big-name managers like Lone Pine, Holocene, Candlestick, Suvretta, and more lost money as industry-wide alpha — or returns beyond the overall market — is on pace for its worst year since 2015, according to client data from Morgan Stanley’s prime brokerage unit.
March ended with a massive market event, thanks to the implosion of Bill Hwang’s family office Archegos that dealt major losses to banks like Credit Suisse and Nomura. Meanwhile other banks, such as Morgan Stanley, offloaded some losses to hedge fund clients with the implied trade-off that those managers would get in on the hottest IPOs, according to a CNBC report.
It’s unclear which fund clients of Morgan Stanley were affected.
Similar to January’s market madness, when the retail trading frenzy around GameStop slammed funds like Melvin Capital, D1 Capital, and Maplelane, March saw losses at big-name managers like Lone Pine, Holocene, Candlestick, Suvretta, and more. A global index of hedge funds from Hedge Fund Research was roughly flat for the month, in comparison.
Tiger Cub Lone Pine, which returned 30% in its long-short fund last year, was down as much as 10% at a point in the first quarter, though the final figure for the quarter is unclear, after the firm lost money in March, sources tell Insider. Another of Julian Robertson’s spinoffs, billionaire Philippe Laffont’s Coatue, lost 2% last month and is flat for the year, sources say. The fund made 64% in 2020 in a banner despite closing down its nascent quant strategy.
Citadel alum-run funds Holocene, Candlestick, and Cinctive all lost money in March, with Brandon Haley’s Holocene dropping the most. $7.5 billion Holocene fell 7% in March and is down roughly 4% for the year, sources say, while Cinctive lost 3% last month …read more