Why Jericho Is Surging

Unlike many of its strategy peers, the TMT fund headed by Josh Resnick is well above its high-water mark.

Illustration by II

Illustration by II

Jericho Capital Asset Management is off to a rousing start this year.

The long-short hedge fund firm headed by Josh Resnick jumped 10.6 percent in February and is now up 22.3 percent for the year, according to an investor, who noted that the fund continues to kill it this month. This comes on the heels of the fund’s 20.2 percent gain in 2023, says the investor.

As a result, the firm is solidly above its high-water mark after losing 23 percent in 2022, a position many of its TMT peers are unable to boast. Jericho declined to comment.

Resnick founded Jericho in 2009. The firm focuses on tech, media and entertainment, telecom, and consumer issues. A good portion of its profits this year have been made on the short side, says the investor. Its gains from longs were more or less across the board.

In the past two years or so, the firm has gotten away from its rapid-trading strategy, in which it was not uncommon to see a slew of new positions crack the firm’s top-ten holdings each quarter. The shift coincides with a sharp rebound in performance over more than a year.

At year-end 2023, just two of Jericho’s nine largest U.S.-listed longs and four of the 15 largest had been initiated in the fourth quarter. In the same quarter, the firm fully unloaded its shares of Uber Technologies, its sixth-largest long at the end of September. Jericho had initiated its stake in the third quarter. The two most significant new positions in the fourth quarter were in The Trade Desk, which provides technology to help companies target users on the internet, and consumer health care company Kenvue.

Two of Jericho’s largest longs are members of the high-flying Magnificent Seven: Facebook parent Meta Platforms, the third-largest, and chip giant Nvidia, the eighth-largest. In the fourth quarter, Jericho scaled back those positions by roughly 30 percent and nearly 16 percent, respectively. Over the first two months of the year, Meta rose 38 percent and Nvidia surged 60 percent.

Jericho’s largest long over the past two quarters was telecom giant T-Mobile US, accounting for more than 9 percent of U.S. common stock assets at year-end, according to the firm’s latest filing. Before that, it was the second-largest. So far this year, the stock is up only slightly.

Online gambling company DraftKings, Jericho’s fifth-largest long at year-end, surged more than 22 percent in the first two months of the year. On the other hand, cloud computing services provider Akamai Technologies, the second-largest long, was down more than 6 percent over the first two months.

Last year, Jericho disclosed in a regulatory filing that it had closed down its Asia Opportunities strategy, which included Jericho Asia Opportunities LP, Jericho Asia Opportunities Ltd., and Jericho Asia Opportunities Master LP. Final distributions to investors were made in February 2023. Institutional Investor reported on the strategy when it was launched in 2019.