Post by jannikki on Dec 8, 2006 20:46:31 GMT -4
US hedge fund loses $1.2bn in assets
William Hutchings
08 Dec 2006
US hedge fund manager North Sound Capital is set to end the year with little more than half of the $2.6bn (€2bn) assets it held in January, following a run of investment losses.
Thomas McAuley, founder of the long/short equity manager, said in a letter to investors: "We have taken steps to ensure the reduction in our capital is as smooth a transition as possible for all investors, and we believe we have been successful in this regard."
The drop in overall assets to $1.4bn comes as investors redeem their money after performance failed to meet their expectations.
The firm's fund, which started the year at $2.6bn, registered a 3.5% investment loss for the first 11 months of 2006. It's annualised returns from inception in 2001 have amounted to 11%, net of fees.
The redemptions, which are due to take effect from the beginning of 2007, have cut back the firm's asset base so much it has been forced to reduce its staffing. About 15 employees have left the firm, according to an investor, including about a third of its equity analysts.
McAuley said: "We have attempted to assist each of these talented individuals in transitioning to new opportunities. We believe the current team is the strongest North Sound has ever had."
He said he was upbeat about the firm's prospects.
"I am writing to convey our excitement about the positive impact we expect these changes to have in 2007. Our investor base continues to represent a long and varied list of great investors, the majority of whom are participating in our longer-term investment classes," he said
www.financialnews-us.com/?page=ushome&contentid=1046736159
William Hutchings
08 Dec 2006
US hedge fund manager North Sound Capital is set to end the year with little more than half of the $2.6bn (€2bn) assets it held in January, following a run of investment losses.
Thomas McAuley, founder of the long/short equity manager, said in a letter to investors: "We have taken steps to ensure the reduction in our capital is as smooth a transition as possible for all investors, and we believe we have been successful in this regard."
The drop in overall assets to $1.4bn comes as investors redeem their money after performance failed to meet their expectations.
The firm's fund, which started the year at $2.6bn, registered a 3.5% investment loss for the first 11 months of 2006. It's annualised returns from inception in 2001 have amounted to 11%, net of fees.
The redemptions, which are due to take effect from the beginning of 2007, have cut back the firm's asset base so much it has been forced to reduce its staffing. About 15 employees have left the firm, according to an investor, including about a third of its equity analysts.
McAuley said: "We have attempted to assist each of these talented individuals in transitioning to new opportunities. We believe the current team is the strongest North Sound has ever had."
He said he was upbeat about the firm's prospects.
"I am writing to convey our excitement about the positive impact we expect these changes to have in 2007. Our investor base continues to represent a long and varied list of great investors, the majority of whom are participating in our longer-term investment classes," he said
www.financialnews-us.com/?page=ushome&contentid=1046736159