Ospraie Will Close Hedge Fund After 38% Loss
By Katherine Burton and Saijel Kishan
Sept. 2 (Bloomberg) -- Ospraie Management LLC, the investment firm run by Dwight Anderson, will close its biggest hedge fund after it fell 38.6 percent this year because of losing wagers on commodity stocks, according to a letter to investors.
The Ospraie Fund lost 26.7 percent in August, after a ``substantial sell-off in a number of our energy, mining and resource equity holdings,'' Anderson, 41, wrote in the letter today.
``I am extremely disappointed with this result and the fund's sudden reversal in performance,'' he said. ``After nine years of striving to be a good steward of your capital, I am very sorry for this outcome.''
Anderson started the Ospraie Fund in 1999, when he worked at Tudor Investment Corp., the Greenwich, Connecticut-based hedge- fund company run by Paul Tudor Jones. He spun off from Tudor at the end of 2003.
The closing of the Ospraie Fund, which managed $2.8 billion as of the beginning of August, leaves the New York-based firm overseeing three remaining funds with more than $4 billion in assets, down from $9 billion in March.
Jonathan Gasthalter, a spokesman for Ospraie, declined to comment.
Ospraie plans to return 40 percent of the closed fund's assets to investors by the end of September and another 40 percent by year-end, according to the letter. The remainder, mostly held in illiquid investments, will be returned ``as investments are realized sufficient to make distributions,'' Anderson wrote.
The fund suffered most of its losses this year since July, when the Reuters/Jefferies CRB Index of 19 commodity contracts fell 10 percent, the biggest monthly decline since 1980. The index has plunged 20 percent from its July 3 peak as prices for oil, wheat and natural gas fell. |
