Polar Asset Bond Manager Neary Exits as Hedge Fund’s Returns Lag
(Bloomberg) -- Portfolio manager Nick Neary left Canadian hedge fund Polar Asset Management Partners after its multi-strategy fund posted its fourth negative monthly return this year, according to people familiar with the matter.
Neary, who joined Toronto-based Polar in 2013, left the firm early this month, the people said, speaking on condition they not be identified because the matter is private. Neary was Polar’s strategy lead for fixed income, according the hedge fund’s website.
A representative for Polar declined to comment. Neary could not be reached and a message to his email address at Polar bounced back.
The Polar Multi-Strategy Fund, which includes fixed income arbitrage, posted a 1.2% loss in October, according to an emailed statement sent to investors by Polar earlier this month. That would be the fourth monthly negative return this year, according to a marketing document from one of the fund’s prime brokerage providers seen by Bloomberg.
The fund was up 3.4% this year to Oct. 31, lagging the 20%-plus returns of the S&P 500 and S&P/TSX Composite Index. The fund, which had about C$6.9 billion ($5.5 billion) in assets as of September, is Polar’s largest.
Some hedge funds’ fixed income strategies have been tested by the recent increase in volatility in government bond markets as investors begin making bets on inflation staying higher for longer.
In Canada, the volatility was compounded by a central bank surprise on Oct. 27, when the Bank of Canada accelerated its timeline for potential interest-rate increases and ended its quantitative easing program. Bonds plunged, with Canada’s 2-year benchmark yield soaring as much as 26.6 basis points that day.
The Polar fund has produced a 12.9% average annual return since inception in 1991, outpacing U.S. and Canadian stock benchmarks.
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