It may not have kept anyone from going to Davos, but people are still pretty pissed at the Swiss over the whole surprise-scrapping-of-the-franc-euro-cap thing. Granted, those people are mostly ones who lost a great deal of money in the ensuing surge in the franc, but such people are legion. For instance, BlueCrest Capital’s Peter von Maydell and COMAC Capital’s Colm O’Shea, who no longer have hedge funds to run. Or Fortress Investment Group’s Mike Novogratz, who hasn’t quite lost as much on the franc as he has on the bitcoin, but who still already has an 8% hole to dig out of this year. Or Interactive Brokers Group, which is pretty sure the $120 million it has lost on the mess isn’t coming back.
Brevan Howard, by contrast, is pretty OK with the whole thing.
Brevan Howard Asset Management’s largest hedge fund has so far avoided losses after the Swiss central bank scrapped its cap on the franc, helping the pool to rebound this year, said a person with knowledge of the matter.
The Brevan Howard Master Fund, managed by billionaire Alan Howard, was up 1.88 percent in the month through Jan. 16, compared with 1.09 percent as of Jan. 9, said the person, who asked not to be identified because the matter is private. The pool had a 0.8 percent loss last year, its first annual decline since it started trading in 2003.
Also unhappy? The National Futures Association, which has been unpleasantly roused from its sleepy self-regulating existence to do something.
The National Futures Association, a self-regulator responsible for policing the futures industry, said it is considering whether to alter a cap on borrowed money, or leverage, for currency bets in response to last week’s market tumult, according to spokeswoman Karen Wuertz.
And that’s to say nothing of all of those Polish and Croatian property owners, who thought at one point that taking out a mortgage in francs was a good idea, to say nothing of the banks in those countries, which aren’t pleased at all about a popular remedy to the first problem.
In Croatia, where about 60,000 homeowners took out franc-denominated mortgages, Prime Minister Zoran Milanovic said his government would consider following the example of Hungary in converting loans into the local currency….
Polish Finance Minister Mateusz Szczurek called on local banks on Tuesday to amend loan rates by applying the below-zero interest rates of Switzerland, calling it a "fair deal".
Regulator to Review Leverage Limits for Currency Trades [WSJ]
BlueCrest suffers losses in Swiss franc fallout [FT]
Hedge fund COMAC to return money after Swiss franc move, poor returns [Reuters]
Fortress loses in torrid week for macro funds after Swiss franc move [Reuters]
Brevan Howard’s Biggest Fund Said to Avoid Loss on Swiss Turmoil [Bloomberg]
Interactive Brokers Unlikely to Recoup Losses From Franc Trades [WSJ]
Croatia to consider loan conversion on Swiss franc surge [Reuters]
Swiss franc surge may prevent rate cuts in Feb –c.banker Chojna-Duch [Reuters]