Macro hedge funds end 2022 on high, many others lose big, investors say

SOME hedge funds that bet on macroeconomic trends boasted eye-popping double and even triple digit gains for 2022, investors said, while other prominent firms that were long on technology stocks got clobbered with deep losses in volatile markets.

Rokos Capital, run by Chris Rokos and one of a handful of so-called global macro firms, gained 51 per cent last year. Brevan Howard Asset Management, the firm Rokos once worked for, posted a gain of 20.14 per cent and Caxton Associates returned 16.73 per cent, investors in the funds said this week, asking not to be identified.

Haidar Capital Management’s Haidar Jupiter Fund surged 193 per cent, an investor said.

Many macro managers sidestepped tumbling equity markets rocked by fast-paced interest rate hikes and geopolitical turmoil including the war in Ukraine to rank among the hedge fund industry’s best performers, data from Hedge Fund Research (HFR) show. The firm’s macro index gained 14.2 per cent while the overall hedge fund index dropped 4.25 per cent, its first loss since 2018.

Equity hedge funds, where the bulk of the industry’s roughly US$3.7 trillion in assets are invested, however fared worse with a 10.4 per cent loss, according to HFR data. While that beat the broader stock market S&P 500 index’ 19.4 per cent loss, some prominent funds posted even bigger losses.

Tiger Global Management lost 56 per cent while Whale Rock Capital Management ended the year with a 43 per cent loss and Maverick Capital lost 23 per cent. Coatue Management ended 2022 with a 19 per cent loss.

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But not all firms that bet on technology stocks suffered. John Thaler’s JAT Capital ended the year with a 3.7 per cent gain after fees following a 33 per cent gain in 2021 and a 46 per cent gain in 2020.

Sculptor Capital Management, where founder Dan Och had battled the firm’s current chief executive in court over his rising pay, posted a 13 per cent drop. Sculptor announced in November that its board had formed a special committee to explore potential interest from third parties.

David Einhorn’s Greenlight Capital, which bet that Elon Musk would be forced to buy Twitter, ended the year with a 37 per cent gain while Rick Sandler’s Eminence Capital was up 7 per cent. Axon Capital, where founder Dinakar Singh bet service company stocks linked to travel and leisure would gain in 2021 after the Covid lockdown, gained 15 per cent in 2022 after a 24 per cent gain in 2021.

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A number of so-called multi-manager firms where teams of portfolio managers make bets on a variety of sectors also boasted positive returns and were able to make good on promises that hedge funds can deliver better returns in tumbling markets.

Balyasny’s Atlas Enhanced fund gained 9.7 per cent while Point72 Asset Management was up 10 per cent. Millennium Management gained 12 per cent while Carlson Capital ended the year with a 7 per cent gain.

Representatives for the firms either did not respond to requests for comment or declined to comment. REUTERS