Singapore hedge fund Asia Genesis Asset Management Pte is closing its macro fund after suffering an “unprecedented drawdown” following China’s stock market rout and Japan’s rally. Chua Soon Hock’s Asia Genesis Macro Fund had a loss of 18.8% in the first weeks of January, according to a letter sent to investors seen by Bloomberg News. The fund is returning money to investors after losses on long Hong Kong and China equities positions as well as short Nikkei bets, according to the letter. “I have reached the stage whereby my confidence as a trader is lost,” Chief Investment Officer Chua wrote in the letter. Tough trading since October and a “disastrous” January “has proven that my past experience is no longer valid and instead, is working against me.” Asia Genesis, which managed $330.2 million at the start of the year, didn’t immediately respond to a request for comment. Chua said the fund made a “big mistake” in trying to pick the bottom of benchmark Hong Kong indexes. He was also “astounded” with the Nikkei-Hang Seng spread that priced Chinese and Japanese stocks at the same value as in 1991. https://www.bloomberg.com/news/arti...enesis-shuts-after-big-mistake-on-china-trade Picking bottoms is not a clever idea running a global macro fund....But fair enough, he admitted his mistakes. "Next time", he will be better at bottom picking!
NK - uptrend since 2 months ago (recent trend) China stocks - downtrend since 6 months ago NK vs China stocks spread - widening when will it narrow down? Picking bottoms : price goes down - buy price goes further down - buy more price goes further down - buy more price goes further down - buy more price goes further down - buy more till hedge fund closes down Are those fund managers newbies? Pressing the BUY and SELL buttons in the correct sequence is very important. There have been many negative news about China's market. China stock market in free fall....no one paying any mind.
That is how hedge fund performance as a class shows an upward biased profitable performance. It is not a reflection of reality.
To make it clearer poorly performing hedged fund which are closed are not included in the performance record of hedge funds in general. It is the old story figures never lie but liars always figure.
Reminds of the fuck ups at LTCM who also thought reversion to mean was just right around the corner. Only it never came and then Yeltsin defaulted on the bonds they were holding --- Oops!