Hmm I remember in one of the market wizard books were a trader talked about how he opened a fund called LS. It originally stood for Larry Shag (spelling?) which was a term they had in the city he was from of a person who was a bit of a gambler or a 'gunslinger'. Later he told his clients it stood for long short instead, as he was afraid the actual meaning would scare clients away.
that was the attraction of the Madoff scam. it was the sales pitch of a moderate consistent profit of 12% per year.
The preservation and growth fund made money in 2008. Other funds of theirs blew up. https://www.ljmpartners.com/performance-history?qt-performance_history=1#qt-performance_history In light of that, It's even more shocking they would blow up on an event like this Monday which wasn't that bad in the vol world.
I'll try again. Maybe I'll Make a Moderate Inconsistent Profit With High Volatility But Most Probably Will Go Bust Capital Management.
Minimum investment: $3M, so their investors are not mom and pop and supposed to be well heeled. Maybe they got careless after all those years of gain betting on low volatility and forgot to hedge this one time? However, they are not hurting collecting 3.3% fee. Poor investors though.
Here is a bit more info: https://www.zerohedge.com/news/2018-02-07/vol-selling-fund-disintegrates-down-80-2-days The question is were they liquidated? If not, a big chunk of that loss was erased during Tuesday rally. What happened on Monday night was a lot worse than 2008 (from options pricing perspective). Just 1 example, February Week2 1550 puts (1000 points away from the market) were trading at 9 points. This was pure madness. The rumor is that ETNs liquidations like XIV were part of the root cause.
You are correct, it was there aggressive main fund that had a 63% drawdown. This was suppose to be the conservative strategy.