Tags: Fortress | hedge fund | Tudor | stocks

Fortress Hedge Fund Said to Fall 2.3 Percent in August

Friday, 05 September 2014 02:07 PM

Fortress Investment Group LLC’s main macro hedge fund lost 2.3 percent last month as its wagers on the economy faltered, said a person familiar with the matter.

The August decline brings losses this year in Fortress Macro Fund Ltd. to 5.8 percent, said the person, who asked not to be named because the returns aren’t yet public. Tudor Investment Corp.’s main fund was up 0.3 percent last month, paring the year-to-date decline to 2.4 percent, according to another person with knowledge of the returns.

Hedge-fund managers that bet on macroeconomic trends are struggling to beat beat other strategies this year as central banks have pushed down benchmark interest rates and volatility has declined, making it harder to profit from trading. Macro funds that wager on broad trends using currencies, interest rates, equities, commodities and other assets have returned about 1 percent this year, compared with the average of 2 percent for all hedge-fund strategies, according to data from Chicago-based HFR.

Gordon Runte, a spokesman for New York-based Fortress, declined to comment, as did Patrick Clifford, a spokesman for Greenwich, Connecticut-based Tudor with the Abernathy MacGregor Group.

Fortress Bets

Macro strategies at Fortress slumped last month because the firm bet that interest rates would rise and was short U.S. Treasuries and German bunds, said the person. The yield on the 10-year Treasury fell to 2.34 percent at the end of August, from 2.56 percent at the end of July. Yields on 10-year German debt decreased to 0.89 percent from 1.16 percent during the same period.

Fortress, the first publicly traded private-equity and hedge-fund manager in the U.S., managed about $63.8 billion as of June 30 with the macro funds contributing $3.4 billion, according to a regulator filing. The firm earlier this year said Jeffrey Feig, formerly at Citigroup Inc., would serve as co- chief investment officer of its macro funds alongside Mike Novogratz.

Fortress, which went public in 2007 at $18.50 a share, dropped 0.5 percent to $7.35 at 1:16 p.m. in New York. The stock has slumped 14 percent this year.

Tudor, the $13 billion hedge-fund firm run by Paul Tudor Jones, in July hired Morgan Stanley strategist Tiffany Wilding, specializing in Treasury Inflation Protected Securities, as investment firms are anticipating that central bank will start raising interest rates.

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Fortress Investment Group's main macro hedge fund lost 2.3 percent last month as its wagers on the economy faltered, said a person familiar with the matter.
Fortress, hedge fund, Tudor, stocks
Friday, 05 September 2014 02:07 PM
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