dunno. they are talking about piano lessons and such over at the spec. seems very mellow. that said, no one should feel any sympathy for bridge jumpers of any kind. if you know anything about the racetrack (Vic often quotes racetrack wisdom) you know what that is.
Well, I am just heartened to know that at least Bloomberg (the reporter e-mailed me this morning) is working on this and we can get some confirmation or refutation, and soon I hope. Incidentally, I posted a simple question on their blog, and I don't believe they have allowed it posted, at least not yet.
I would venture that anyone running a fund has bigger fish to fry than to respond to your posts on this forum.
Huh? Vic called Baron several weeks ago when I first reported Matador's blow up. Secondly even if Vic was still running a fund-which he isn't-how busy does one need be to just sit with an unhedged position of OTM puts. An infant could "run" a fund the way Vic does it.
You have to admit, time would have to be spent making sure there was an ample supply of Charmin and Depends on hand.
Numerous FOF's invest in the various funds run by Manchester. I believe Matador, the oldest offshore fund they run is 100% invested in by Octane, but there are at least 3 other funds, plus some private accounts managed there. It is not unusual for a hedge fund to stop reporting returns once it is closed to new investors. Essentially funds report returns in order to attract investment, and then they stop. That is why is is so hard to construct any sort of hedge fund index, the big funds which make up most of the market do not report. Nontheless, usually when there is a blowup, one of the investors leaks the information to the press. I would be awfully suprised if such a thing could be kept quiet this long.
I agree. Hedgewire would have had something on this, if it was real or even a widely spread rumor. This is the only place I have seen the rumor. I even think the Bloomberg reporter, I corresponded with, didn't think there was much there or much that they had or could get.
Thanks to EPrado for links: http://www.newyorker.com/reporting/2007/10/15/071015fa_fact_cassidy?currentPage=1 http://www.nypost.com/seven/10072007/business/victor_hit_again.htm?page=0 Thanks to Pa(b)st Prime for early scoop in Aug! VICTOR HIT AGAIN NIEDERHOFFER CRUSHED BY SUBPRIME MELTDOWN By PAUL THARP Hedge fund titan Victor Niederhoffer in his Connecticut mansion.October 7, 2007 -- Victor Niederhoffer appears to be a two-time loser. Niederhoffer, the father of modern hedge funds, who lost his entire $130 million portfolio in 1997 when he bet wrong that stocks in Thailand were ready for a bull run but then slowly and carefully rebuilt his business and his reputation, was been forced to shutter his flagship Matador fund last month after getting blindsided by the subprime mortgage meltdown. The incredible story of loss, redemption and then loss again, which was lost amid the hedge fund disasters at larger firms like Goldman Sachs, Bear Stearns and Lehman Brothers, is unfolded in the next issue of The New Yorker, on newsstand tomorrow. The Brooklyn-born, Harvard educated Niederhoffer, 63 tells the magazine, the subprime mortgage mess âis one of the greatest turmoils in Wall Street history." âI was caught wrong-footed in the market turbulence," said Niederhoffer, whose $350 million of assets under management was puny compared to the multi-billion dollar blow-ups down the Street. âWe were prepared for many different contingencies, but this kind of one we were not prepared for." No, it wasn't the size of the blow-up that made it so poignant but that Niederhoffer was a lifelong gambler who'd tip-toed about the rim of stupid investment moves - and fallen hard - just 10 years ago. It was the so-called Asian contagion that did him in then. It could have been hubris that knocked him down this time. A member of the squash hall of fame and a collegiate champion at Harvard, Niederhoffer's first memory of putting money on the line was a $2 bet he placed on the Brooklyn Dodgers in 1951. On Yom Yippur that year, an eight-year old Niederhoffer sneaked out of synagogue to place his Dodgers bet - which lost spectacularly when Bobby Thompson hit the shot heard 'round the world. After losing his entire $139 million portfolio, Niederhoffer went into a depression for years. By 2003 he was finally ready to start anew. Using small investment from the few institutions that still trusted him, Niederhoffer set up an offshore hedge fund and it returned profits of more than 40 percent in each of the first two years. In 2005, it was up 56 percent and the world was starting to take notice that Niederhoffer was back. Still, the investor tells The New Yorker, he knew it was risky. âIf you are going to try and make forty or fifty percent a year, tremendous variations are inevitable." Niederhoffer tells the magazine his three decades as a professional investor were based on the widespread recklessness that fed the current mortgage mess. He said he made fortunes several times over âtypically by relying on methods that other traders considered reckless or unorthodox or both." Niederhoffer respects risk, and treasures a large 1820 painting of a whaling ship that was the inspiration for âMoby Dick," a sign of how quickly fame and fortune can vanish. His 20,000-square-foot mansion, with 30-foot-high ceilings and crammed with artworks and hunting collectibles, is as eclectic as his approach to investing. Niederhoffer, a child mathematics prodigy who holds a doctorate in economics, was still working his valued computer formulas earlier this year. He believes markets don't act randomly and that their swings can be predicted. Now, they were telling him it would be smooth sailing with little volatility. Then the incredible 100-point plus swings of July and august hit and Niederhoffer left himself without a safety net of cash. When the market dived and the investor was asked to double the amount of capital supporting his highly leveraged positions, he couldn't come up with the cash. The funds were forced to close. âMy basic ideas about the creative powers of the market, buying in panics, buying on weakness - I don't think what has happened has anything to do with that stuff," he said. âI am going to keep going, for better or worse."
In September, he was forced to close two of his funds, including his flagship, Matador, which had declined in value by more than seventy-five per cent. Ouch.. and right before the Fed rate cut, which would have recouped "most of the losses." Talk about terrible timing.. The article all on one page (instead of 12) http://www.newyorker.com/reporting/2007/10/15/071015fa_fact_cassidy?printable=true