Alan Howard’s Hedge Fund Slumps 8.5% in Two Months

(Bloomberg) -- Hedge-fund manager Alan Howard is having a rough start to 2019 in the fund that he oversees himself, a person with knowledge of the matter said.

The Brevan Howard AH Master Fund declined 8.5 percent in the first two months of this year, the person said, asking not to be identified because the information hasn’t been widely disclosed. Howard is the sole manager of that fund, which the industry veteran launched two years ago. A spokesman for the Jersey-based investment firm declined to comment.

The drop eroded the macro fund’s 30 percent gain last year, which was mostly the result of a particularly strong performance in May. Macro money pools speculate on economic events and benefited in 2018 from the prospect for higher interest rates and volatility caused by geopolitical tensions. Those factors helped them to shrug off the losses that afflicted the hedge-fund market as a whole.

Howard’s fund manages the billionaire’s own money, and includes some outside investors such as the New York City Police Pension Fund. It also runs some money for the flagship Brevan Howard Master Fund.

Best Year

That main fund lost 0.2 percent in the first two months of this year, according to a letter to investors seen by Bloomberg. It posted a 12.3 percent return in 2018, its best year since the end of the global financial crisis, Bloomberg reported in January.

The hedge-fund industry as a whole gained about 3 percent in January and February, according to a preliminary estimate from Eurekahedge, marking a modest recovery in 2019 amid a rebound in stocks.

  • Many of the Brevan funds that were launched to reduce the firm’s reliance on the main Master Fund started the year in the black, the investor letter shows
  • The Brevan Howard MB Macro fund led by long-time trader Minal Bathwal gained 4.7 percent in January, while the firm’s Alpha Strategies pool returned 2 percent
  • Brevan’s assets have fallen to $6.4 billion, the letter shows, from more than $40 billion in 2013
  • Brevan Howard Master Fund, which managed $2.5 billion at the end of January, allocates money to funds managed by traders including Bathwal, Alfredo Saitta and Fash Golchin.

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