Renaissance Funds Lead the Way In First Half
A large number of high-profile hedge funds lost money in June. But the best performers in June, as well as for the year, are the funds managed by James Simons’ Renaissance Technologies.
A large number of high-profile hedge funds lost money in June. However, not nearly as much as the average fund, which HFR says dropped 0.18 percent in June as well as for the year-to-date through June. The S&P 500 lost more than 5.2 percent last month and 6.7 percent in the first half.
What’s more, a handful of top hedge funds made money in June, according to investors, databases and other sources. In fact, the best performers in June as well as for the year are the funds managed by James Simons’ Renaissance Technologies.
Super-secretive Medallion, the computer-driven, rapid trading fund closed to outsiders for years, was up 17 percent for the first half.
Renaissance Institutional Equities Fund International L.P. (RIEF), its newer fund that had been struggling, climbed about 2.4 percent in June and was up about 3.5 percent for the first half of the year. Sure, like many funds it has given back some earlier gains. However, the fund, which lost money the past three years, has beaten the S&P 500 by more than 1000 basis points so far this year. Keep in mind it was designed to outperform the S&P 500 index, gross of fees, by 400 to 600 basis points over a rolling three-year period with lower volatility.
The more successful Renaissance Institutional Futures Fund (RIFF) is up about 10.6 percent for the year.
Dan Loeb’s Third Point Offshore Fund, which has been leading the pack most of the year, is up 10.2 percent at the half-way point despite dropping two percent in June. Its top five winners in the month underscore how investors need to be nimble and flexible. Two of his top five gains came from unidentified shorts. Another big winner resulted from an arbitrage position made after Novartis announced it would buy a majority stake in Alcon. Loeb’s other two top-five gains came from the debt of Icelandic Banks and an asset backed security.
Michael Platt’s London-based Bluecrest Capital International continues to surge. The multi-strategy fund, which plays currencies and interest rate swings, climbed nearly 10 percent for the first six months after rising about 45 percent in 2009. His Bluetrend fund (3.5 percent through June 25) and Allblue (4.9 percent) were up, but not as much.
Richard Perry, the long-short player who has morphed into an event-driven manager, is also having another strong year. Perry, who suffered his first down year in 2008, was up 8 percent through June.
David Tepper’s Palomino has given back a fair amount of its early-year gains, losing more than 3 percent alone in June. Even so, it is still up more than 7 percent for the year.
Otherwise, most of the most well known managers who made money in the first half were up no more than 5 percent, still much better than the 6.7 percent loss for the S&P. They include Bruce Kovner’s Caxton Global Investments (4 percent), Alan Howard’s Brenan Howard Fund (1.5 percent through June 25), Stevie Cohen’s SAC Capital (2.9 percent) and Phil Falcone’s Harbinger Capital Portfolio Offshore (4.24 percent).
Among the worst performers in June was the volatile Bill Hwang of Tiger Asia, who dropped 5.9 percent for the month alone. This nearly sliced his year-to-date gains in half, 6.2 percent.
On the other hand, a number of prominent managers are down for the year. They include Louis Bacon’s Moore Global (6.9 percent through June 25) and Moore Emerging Markets (6.8 percent), which is managed by former GLG superstar Greg Coffey. (Moore Macro Managers was up about 4 percent through June 25). Ken Griffin’s Citadel Wellington fund is down 2.9 percent for the year.