"The fact that I had a horrible quarter is a statistical probability, and we had always told people there is that possibility. We do everything that we can to manage the risk, and I think we're better at it today than we were a year ago.''In fact, they managed risk so good that they lost over half their assets in less than six months and are closing their flagship fund. Some times you just have to tell it like it is. People are forgiving, even when you lose lots of money. Just ask Brian Hunter.
"Profit from your knowledge!"
The Bull Bear Trader discusses market events and news with an interest in understanding risk and return in both bull and bear markets. Discussion topics include trading and hedging strategies, derivatives, risk management, hedge funds, quantitative finance, the energy and commodity markets, and private equity, as well as an occasional investment opinion.
Wednesday, September 3, 2008
Opsraie Closing Its Largest Hedge Fund
Ospraie Management is closing its largest hedge fund after it has been down 38.6 percent this year as a result of bad bets on commodity stocks (see Bloomberg article, CNBC article). The fund got hammered in August, falling 26.7 percent after a sell-off in energy, mining, and commodity stocks. The closing leaves Ospraie Management with three funds that manage more than $4 billion of assets. Amazing, the $4 billion figure is down from $9 billion in March. Talk about the dog-days of summer. Lehman Brothers, with its own problems (see posts here and here) bought a 20 percent take in Ospraie Management in 2005 - yet another unfortunate turn-of-events for Lehman. Of interest is the quote from Dwight Anderson, manager of Ospraie Management:
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