Y****n
发帖数: 1309 | 1 World's Most Bearish Hedge Fund Shuts Down: Here Is Russell Clark's Farewell
Letter
It was about four or five years ago that we dubbed Russell Clark (formerly
of Horseman Global and more recently of Russell Clark Investment Management)
the world's most bearish hedge fund, and for a good reason: roughly a
decade ago, Clark decided to take his fund net short - an unheard of event
in an industry where despite the name, the average net exposure is well
north of 100% - and while his market bias ebbed and flowed, it remained
short for much of the past ten years.
This was the beginning of the end for Clark - sensing what was coming, two
years ago we wrote that the "World's Most Bearish Hedge Fund" Loses 75% Of
Its Assets After Worst Year On Record." Back then we wrote the following:
Every trader has heard the age-old saying "don't fight the Fed". Everyone,
perhaps with one exception: Horseman Global's CIO, and recently owner,
Russell Clark, who has been upping his bearish bets in the face of a
relentless liquidity onslaught by the Fed, ECB and PBOC, which now also
includes the Fed's "NOT QE." In fact, in his ambition to on up the central
banks, Clark may have overdone it, because according to his latest investor
letter, the fund's equity net short position is now the highest it has been
in history, at a whopping -110.87%, offset by a 60.59% net long in bonds.
Alas, while we admire Clark's courage, we have less empathy for the fund's
performance, which has seen better days, and after slumping 6% in October,
and losing money on 4 of the past 5 months, is now on pace for its worst
year on record, down 27.05% YTD, surpassing the -24.72% return posted in
2009, and reversing all the goodwill the fund created with its 7.5% return
last year when most of its peers lost money alongside the S&P500.
In light of the above, we have been fascinated how long Horseman can remain
solvent as the Fed remains irrationally bullish and liquid, and
unfortunately for Clark - who recently put his personal money where his
mouth is and bought a controlling interest in Horseman where he was the main
portfolio manager for years - the answer appears to be "not much longer" -
as the fund reports, as of October 31, the AUM for the Horseman Global Fund
was down to just $150 million...
Two years later, despite the crash in early 2020 which helped boost the fund
's fortune for a few months, the slow and steady death by a thousand
redemption letters continued, and this morning our prediction has finally
come true: the man who for the past decade valiantly fought the Fed, and all
other central banks, has finally thrown in the towel.
And with capital in his core RCIM Global Fund dropping to just $119 million
from as much as $1.7 billion in 2015, Clark writes in what is his last
letter to investors that "after a couple of years of turbulent markets and
the increasing influence of politics rather than economics on the markets, I
have come to the decision that the best way forward is for the Fund
Directors to wind up the fund and return capital."
The fund shuts down after dropping 5.3% for the month of October and down 2.
6% in 2021. | T****O
发帖数: 407 | 2 年初GME、AMC那一波看来套死了一大票空头基金
没套死的被忽悠去做空苹果和特斯拉
现在也死透了
世间再无空头
但是，等到多头杀多头的时候
那一定很好看，很好玩 | a*****1
发帖数: 3134 | 3 Usually that means the start of the downward movement. 大牛一般都是死在黎明
前。
Farewell
Management)
【在 Y****n 的大作中提到】
: World's Most Bearish Hedge Fund Shuts Down: Here Is Russell Clark's Farewell
: Letter
: It was about four or five years ago that we dubbed Russell Clark (formerly
: of Horseman Global and more recently of Russell Clark Investment Management)
: the world's most bearish hedge fund, and for a good reason: roughly a
: decade ago, Clark decided to take his fund net short - an unheard of event
: in an industry where despite the name, the average net exposure is well
: north of 100% - and while his market bias ebbed and flowed, it remained
: short for much of the past ten years.
: This was the beginning of the end for Clark - sensing what was coming, two
| L***s
发帖数: 1148 | 4 Clark's final message to investors is below:
The fund lost 5.30% this month, mainly from the short book.
After a couple of years of turbulent markets and the increasing influence of
politics rather than economics on the markets, I have come to the decision
that the best way forward is for the Fund Directors to wind up the fund and
return capital.
The success I enjoyed from 2011 through to beginning of 2016 largely stemmed
from asking the question that no one seemed to ask – why does the Yen and
Japanese Government Bonds rally whenever there is a crisis? The obvious
answer was capital flows from Japan would create a bull market in the area
they flowed to, and then when the Japanese pulled capital back, it would
create a bear market, often with significant currency volatility. Armed with
that observation, and combined with analysis of the commodity markets, we
build a portfolio that was largely short emerging market and long bonds.
Since 2016, using the same analysis as above, Japanese capital flows have
almost exclusively been to the US, and are an order of magnitude larger than
anything seen before. And yet, US equities still power ahead, Yen remains
weak, and currency volatility has been consigned to the history books. Of
course, I asked myself why this is. Why did a model that worked so well, for
the best part of 25 years, stop working?
The obvious answer is that central banks led Quantitative Easing (QE). But
that answer alone seems insufficient to me. Japan has had low interest rates
for years and was still racked by bouts of extreme equity and currency
volatility. The other problem with that answer is that the big inflation
spike seen this year should then lead to greater volatility in equities,
especially as central banks dial back QE programs.
The answer for me comes from China. China wants a strong currency, and to
keep consumption strong. It seems to me that the Chinese government uses it
extraordinary control of the economy to control activity and the currency
through the commodity markets. To elaborate, I expected China to post a weak
trade surplus in October, and for currency devaluation fears to spike (
particularly after the recent Evergrande selloff). Chinese trade surplus was
actually very strong. And it was strong because Chinese imports of oil and
iron ore were down significantly. Chinese steel production was down a
stunning 20% year on year, a number you would typically only see in a bad
recession.
China has effectively taken control of key commodities, and now adjusts
volumes to suit its own needs. Taking all this volatility through physical
markets, has essentially collapsed financial market volatility, and also led
to commodity currencies being significantly weaker than commodity prices –
which has been a problem for me this year.
Now I understand this, non-obvious trades at the beginning of the year such
as long oil, short iron ore now seem obvious. The surprising weakness of
gold and other precious metals can make sense in this analysis. It also
explains why the extraordinary fiscal and monetary policies of the US have
not been met with greater commodity or bond turbulence. It is very hard for
me to get bearish US treasuries when I see Chinese steel production down 20%
year on year.
The big question then is whether this Chinese policy of absorbing financial
risk in the physical economy sustainable? History suggests not, as most
countries prefer to devalue than slow economic growth. However, I can see
reasons why China may continue with this policy. The most powerful is that
with US policymakers seemingly unable to raise interest rates, or balance
budgets there is a gap in the market for a credible currency. Is China
making a play for reserve currency status?
And this is why I am returning capital. Markets have now become a political
choice. US markets are essentially a bet on the Fed unable to raise rates,
and congress unable to regulate big tech or raise corporate tax rates.
Commodity markets have now become a bet on Chinese policy objectives, and
currencies have become a bet on what Chinese policy objectives are too.
Give me an economic problem, then I can properly gauge risk. Give me a
Chinese political problem – I am taking a guess as much as the next person.
Did I think Alibaba was going to fall 50% this year? No, not until the
Chinese government told me to think that way. Is Alibaba a good short now? I
have no idea, and like everyone else will have to wait to see what the
Chinese government says.
So, I think it time to step back, have a think about where we are going, and
then come back when I can see an opportunity for my skill set. Perhaps that
’s never, but I doubt it. The only constant in life is change. This will be
my final newsletter and it just leaves me to thank you for your support and
wish you all the success in the future. From a personal perspective I plan
to keep producing research, so keep an eye out for my future notes. Russell. | h******k
发帖数: 13418 | | g******6
发帖数: 942 | | H******C
发帖数: 700 | 7 大牛和非大牛一样，绝大部分都是牺牲在黎明前。
【在 a*****1 的大作中提到】
: Usually that means the start of the downward movement. 大牛一般都是死在黎明
: 前。
:
: Farewell
: Management)
| J**e
发帖数: 1 | 8 不牺牲就没有黎明。
There has to be enough deaths before dawn breaks.
【在 H******C 的大作中提到】
: 大牛和非大牛一样，绝大部分都是牺牲在黎明前。
| g********0
发帖数: 6201 | 9 他们不割肉，MM没法创造黎明。
【在 J**e 的大作中提到】
: 不牺牲就没有黎明。
: There has to be enough deaths before dawn breaks.
| a*****1
发帖数: 3134 | 10 果然那是最高点，是个转折点。
【在 a*****1 的大作中提到】
: Usually that means the start of the downward movement. 大牛一般都是死在黎明
: 前。
:
: Farewell
: Management)
| f*********a
发帖数: 435 | 11 大庄不可能让小户赚大钱了
【在 a*****1 的大作中提到】
: 果然那是最高点，是个转折点。
|
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