Hedge Funds Face Uphill Climb as March Returns Roll In

Apr 6 2016 | 10:47pm ET

March hedge fund returns are showing that while the volatility may have lessened, many alternative asset managers face challenges overcoming the poor results they racked up in January and February.

Fresh on the heels of news that Bill Ackman’s Pershing Square lost more than 7% last month, Reuters reports that technology-focused Tiger Global Management dropped slightly in March and remains down 21% in the first quarter. The company’s $6 billion hedge fund gained 6.8% last year, in stark contrast to the drawdowns booked by most of its peers, but its penchant for concentrated bets in technology stocks – among them Amazon, Netflix, Tableau Software and JD.com – has left it nursing outsized losses this year. 

Elsewhere, Jonathan Auerbach’s Hound Partners was down 1.9% in March, partly due to the fund’s position in Valeant Pharmacuticals, and is now down around 12.3% for the year to date. Richard Gerson’s Falcon Edge Capital, meanwhile, dipped 2.2% in March and was down 14.6% though the end of the first quarter. The fund, which listed Allergan as one of its top holdings in recent securities filings, has likely slipped further this month following the collapse of the Allergan-Pfizer merger earlier this week. 

The main macro hedge fund at Alan Howard’s beleaguered Brevan Howard Asset Management lost 2% in March, according to Bloomberg, essentially negating the 1% it was up through the first two months and leaving it down 0.97% for the first quarter. Brevan, which has seen overall assets erode from more than $40 billion to under $25 billion following two consecutive years of losses, manages approximately $18 billion in the fund.

The 1.2% gain in March at $30 billion long/short fund Viking Global Investors took a chunk out of the fund’s 2016 losses, but it remains down 8.3% so far this year. Likewise, Dan Loeb’s Third Point and Barry Rosenstein’s JANA Partners posted strong numbers in March but remain down 1.2% and 6.1% for the year, respectively.  

The average hedge fund gained 1.24% in March but remains down 1.87% for the year to date, according to Hedge Fund Research’s HFRX Global Hedge Fund Index.  


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