Hedge funds keep getting crushed
After a rough 2015, “smart money” hedge fund investors are getting crushed again this year as some of their favorite stocks get walloped.
The average hedge fund that invests in stocks — as opposed to debt or currencies — dropped 3.66% in the first month of the year, according to data from Hedge Fund Research.
Some of the biggest names to get trounced include:
Pershing Square Capital Management, the publicly traded investment vehicle of billionaire hedgie Bill Ackman, fell 11% last month following a 20% decline last year, data from the website show.
Larry Robbins’ Glenview Capital, famous for picking stocks that could benefit from Obamacare, dropped 13.65% in January following a decline of 18% last year, according to data from HSBC’s Hedge Weekly report, a copy of which was obtained by USA TODAY.
Marcato International, a well-known activist fund run by Ackman protege Mick McGuire, fell 12.1% last month following a 9% loss last year, according to HSBC.
Even last year’s winners had a tough time of it in January: Trian Partners, whose Nelson Peltz made headlines fighting with DuPont last year, lost 7% in January, HSBC data showed. Last year, Trian posted gains of more than 4%.
Tiger Global Management — run by Chase Coleman, a descendant of Peter Stuyvesant, one of New York’s earliest movers and shakers, lost 14% last month, according to Reuters.
Last year, the tech focused fund posted gains of 6.8%.
Maverick Capital, run by Texas billionaire Lee Ainslie, fell 2% in January, HSBC data showed. The hedge fund firm stunned with a 16% gain last year.
The decline follows big losses in some of the hedge fund industry’s top stocks. Shares of Amazon.com (AMZN), for example, are down 25% this year. Apple (AAPL), another hedge fund favorite, is down 10% this year, while Netflix (NFLX) has dropped 27%.
Pharmaceutical stocks, which hedge funds poured into last year because of heavy merger activity, are also taking a licking amid concerns about drug prices.
Valeant Pharmaceuticals (VRX), a hedge fund favorite that hurt Ackman’s Pershing especially hard, is down 5% this year, following double-digit declines last year.
Chemical giant DuPont (DD), meanwhile, is down 12% this year.
Energy companies and financial stocks are also getting crushed on fears that they will get hurt by falling oil prices.
One minor exception to the January doldrums appears to be Greenlight Capital, a hedge fund run by famed short-seller David
Einhorn. The fund eked out a 1.3% return following a 20% decline last year, HSBC data showed.