Largest hedge fund closes after losing all its money

by Trust Matsilele 0

“Marko Dimitrijevic, the hedge fund manager who survived at least five emerging market debt crises, is closing his largest hedge fund after losing virtually all its money,” reported Bloomberg.

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The closure follows Swiss National Bank’s unexpected move of letting the franc trade freely against the euro.

According to reports, Everest Capital’s Global Fund had about 830 million US dollars in assets as of the end of December.

Everest Capital that specialise in emerging markets, manages seven funds with about 2.2 billion US dollars in assets.

“The global fund, the firm’s oldest, was betting the Swiss franc would decline, said the person, who asked not to be named because the information is private,” added the Bloomberg report.

According to the Bloomberg, the SNB’s decision to end its three-year policy of capping the franc at 1.20 a euro triggered losses at Citigroup Inc., Deutsche Bank AG and Barclays Plc as well as hedge funds and mutual funds.

The franc surged as much as 41 per cent versus the euro on Jan. 15, the biggest gain on record, and climbed more than 15 per cent against all of the more than 150 currencies tracked by Bloomberg.

Dimitrijevic started the firm in 1990 with eight million UU dollars and has seen assets rise and fall as investors rushed in and out of emerging markets.

“Everest grew to 2.7 billion US dollars by the start of 1998 after navigating crises in Mexico and Southeast Asia,” added Bloomberg.  

According to reports, last year, the main fund rose 14.1 per cent, driven by Chinese equities and bets against currencies, including a wager that the Swiss franc would fall after citizens rejected a referendum that would require the central bank to hold at least 20 per cent of its assets in gold.

Everest Capital, an independent investment management firm was founded in 1990 offers global, emerging markets, Asia, Latin America and frontier markets strategies.