Hedge Funds Report Abysmal Results in September

In yet another example to shatter the myth that hedge funds are anything other than leveraged beta and momentum chasing monkeys (or even worse, robots), marketfolly has presented the results for September and year-to-date for many of the leading hedge funds - and boy are they ugly. From marketfolly:

Paul Ruddock & Steven Heinz’s Lansdowne Partners: (UK Equity Fund: $8 billion)
-1.59% in September, -15.16% year-to-date

Crispin Odey: Odey European: $2.3 billion
-3.43% in September, -17.8% ytd

Mark Kingdon’s Kingdon Capital: $2 billion
-7.99% in September, -18.73% ytd

Lee Ainslie’s Maverick Capital: Maverick Fund $1 billion
-7.91% in Sept, -16.92% ytd

Andreas Halvorsen’s Viking Global: Equities III Fund $1.6 billion
-2.19% in Sept, +0.70% ytd

Alexander Roepers Atlantic Investment Management: $445 million
-9.36% in Sept, -14.16% ytd

Wayne Cooperman’s Cobalt Capital: $1.3 billion
-3.82% in Sept, -3.72% ytd

Ricky Sandler’s Eminence Capital: $2.5 billion
-2.7% in Sept, -8.77% ytd

Curtis Macnguyen’s Ivory Capital: $2.3 billion
-3.24% in Sept, -6.57% ytd

Leon Cooperman’s Omega Advisors: $1 billion Overseas Partners
-7.58% in Sept, -12.36% ytd

Jim Simons’ Renaissance Technologies: Institutional Equities $240 million
+0.76% in Sept, +24.37% ytd

Ron Gutfleish’s Elm Ridge Partners: $2.4 billion
+1.5% in Sept, -2.84% ytd

David Einhorn’s Greenlight Capital: $7.2 billion
-0.76% in Sept, -6.16% ytd

Jeffrey Altman’s Owl Creek: $4.8 billion
-7.6% in Sept, -15.62% ytd

Richard Perry’s Perry Partners International: $4.9 billion
-2.43% in Sept, -7.18% ytd

Jamie Dinan’s York Capital: $2 billion
-4.74% in Sept, -9.06% ytd

Barton Biggs’ Traxis Partners: $547 million
-3.8% in Sept, -2.11% ytd

Clint Carlson’s Carlson Capital: $2.8 billion Double Black Diamond Fund
-1.09% in Sept, -2.23% ytd
John Thaler’s JAT Capital: $1.4 billion
-3.2% in September, +30.68% ytd

Dan Loeb’s Third Point (Offshore Fund): $4.27 billion fund AUM
-3.5% in September, +0.2% year-to-date

Bill Ackman’s Pershing Square Capital Management: $5.1 billion fund AUM, $8.8 billion firm AUM
-5.7% net in September, -15.8% year-to-date

John Paulson’s Paulson & Co
Advantage Fund -6% in September, -28% ytd

Paul Tudor Jones’ Tudor Investment Corp: $8.3 billion fund AUM
+4.9% in Sept, +5.45% ytd (BVI Global Fund)

Bruce Kovner’s Caxton Associates: $6.8 billion fund AUM
+0.28% ytd through September 30th (Limited Fund ran by Andrew Law)

Louis Bacon’s Moore Capital Management: $7.6 billion fund AUM
-1.64% ytd through September 29th

Moore Capital Management (Greg Coffey’s Emerging Fund): $1.5 billion fund AUM
-1.32% in September, -7% ytd

Chris Pia’s Pia Capital: $215 million
-7.16% in Sept, -14.84% ytd

Brevan Howard (Flagship Fund): $24.3 billion fund AUM
+12.98% ytd as of September 23rd (run by Alan Howard)

Jay Petschek & Steve Major’s Corsair Capital ~ $749 million AUM
-8.1% in September, -9.5% year-to-date

Whitney Tilson’s T2 Partners
-9.5% in September, -29.6% year-to-date

Remember, people pay these geniuses 2% management fees and 20% of profits because they are supposed to be long when the market goes up and short or hedged when the market goes down. Sure, many have outperformed the S&P, which was down 7.2% in September and 10% YTD, but almost all are still posting material losses for the month and year-to-date. On the other hand, if investors instead bought gold rather than invest in these illiquid limited partnerships with massive fees, they would be up 14.1%. Even silver has done better, down only 2.8% year-to-date.

I’m not using the above example to push gold and silver, but to highlight the fact that hedge funds do not, in the aggregate, create value for investors. Yes, some consistently do, but most do not. Likewise it is well known that neither do mutual funds.

Not surprisingly, we are hearing more and more cases of investors wanting to retake control of their investments. Some are using advisors on a discretionary basis only, some simply now do their own research and others have shifted capital out of public markets completely - investing in alternative assets such as metals, real estate, farmland and small business. The performance delivered by the “professional” investors will only serve to exacerbate this trend.