Hedge fund in trouble
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Ospraie closes $250 mln commodity hedge fund
Thu Jun 8, 2006 9:12 AM ET
NEW YORK, June 8 (Reuters) - A $250 million hedge fund specializing in commodity trading is being closed by Ospraie Management LLC, a spokesman for the firm confirmed on Thursday.
The Ospraie Point Fund, which lost 29 percent in the first five months of the year, incurred heavy losses betting that the price of copper and other commodities would fall, said a source with knowledge of the fund's activities.
The Point fund is a small companion fund to the flagship $2.5 billion Ospraie Fund, which also focuses on commodities but is less concentrated, said the source who declined to be named for the record.
Ospraie was founded six years ago by Dwight Anderson, who made his name trading at Paul Tudor Jones's Tudor Investment Corp. and Julian Roberson's Tiger Management LLC.
Rumors have swirled in recent weeks that New York-based Ospraie suffered heavy losses when it was caught with a short copper position as the price of the metal rallied to record highs in May.
The source said the hedge fund's losses stemmed from a combination of bad bets in commodities, which rallied strongly this year before falling sharply in recent weeks. "It wasn't entirely a short copper trade."
The source added, "A copper position on in Ospraie would have a greater relative concentration in Point."
Investors will have the choice of redeeming their investment in Ospraie Point or putting their money into the larger Ospraie fund, which makes smaller bets in many of the same markets and declined 19 percent in the first five months of 2005.
Thu Jun 8, 2006 9:12 AM ET
NEW YORK, June 8 (Reuters) - A $250 million hedge fund specializing in commodity trading is being closed by Ospraie Management LLC, a spokesman for the firm confirmed on Thursday.
The Ospraie Point Fund, which lost 29 percent in the first five months of the year, incurred heavy losses betting that the price of copper and other commodities would fall, said a source with knowledge of the fund's activities.
The Point fund is a small companion fund to the flagship $2.5 billion Ospraie Fund, which also focuses on commodities but is less concentrated, said the source who declined to be named for the record.
Ospraie was founded six years ago by Dwight Anderson, who made his name trading at Paul Tudor Jones's Tudor Investment Corp. and Julian Roberson's Tiger Management LLC.
Rumors have swirled in recent weeks that New York-based Ospraie suffered heavy losses when it was caught with a short copper position as the price of the metal rallied to record highs in May.
The source said the hedge fund's losses stemmed from a combination of bad bets in commodities, which rallied strongly this year before falling sharply in recent weeks. "It wasn't entirely a short copper trade."
The source added, "A copper position on in Ospraie would have a greater relative concentration in Point."
Investors will have the choice of redeeming their investment in Ospraie Point or putting their money into the larger Ospraie fund, which makes smaller bets in many of the same markets and declined 19 percent in the first five months of 2005.
They let 1 copper trade wipe them..... jeez, talk about lack of risk management lol....
You'd be surprised how many hedge funds have concentrated positions.
And how vulnerable rich people make themselves to losses by investing with them.
Not everyone can be above average, but every schmoe who runs a fund seems to think that he is.
And how vulnerable rich people make themselves to losses by investing with them.
Not everyone can be above average, but every schmoe who runs a fund seems to think that he is.
StreamlineTrade
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Didn't they look at a chart?
most of the value guys don't look at charts, which is good for the markets and students of the market
Not to be persnickety, but could you please expand?
1. How do you know this?
2. Why is this good?
3. What do you define as "looking at charts"? Seems to me from your post that one who looks at charts is necessarily a technical analyst.