Hedge funds enjoyed their best year in more than a decade in 2020. Sure, they still underperformed the broader market by almost half, and managed a whopping quarter of the return produced by the Nasdaq Composite, but, you know, strongly caveated and underwhelming credit where it’s due. After all, a rising tide really does lift all boats. Why, just ask David Einhorn!
Greenlight Capital ended 2020 with a 5.2% gain thanks to a dramatic fourth quarter comeback when bets on a homebuilder, jet leasing company and home security services company turned into a 25% return, the firm said in a letter to investors on Thursday.
The hedge fund, run by David Einhorn, lagged far behind the broader S&P 500 index’s 18.4% gain but celebrated its late year surge which it described as “the best quarterly result in Greenlight’s history.”
David Einhorn’s Greenlight Capital has given up on its technology shorts, covering its infamous bubble basket “at a moderate loss,” according to its fourth-quarter letter…. In the new letter, sent to clients on Thursday and obtained by Institutional Investor, the firm seemed to walk back some of its previous assertions that the technology bubble had popped and that September 2 may have marked the top of the cycle.
“Our language was imprecise,” Greenlight explained. “We don’t believe that all technology stocks are in a bubble.”
See, things are so great that even David Einhorn could be completely wrong about the thing he’s been banging on about (and losing gobs on money on) for years and still turn in a positive year! Imagine what a hedge fund manager not afflicted with end-stage Ackmania could do in such an environment!
[Michael] Platt has guided his private investment firm BlueCrest Capital Management to blockbuster gains year-after-year. Returns soared to 95% in a tumultuous 2020 when a global pandemic roiled markets, according to a person with knowledge of the matter. His personal wealth has doubled in the past year to about $10 billion, according to Bloomberg estimates…. Last year’s performance follows a gain of about 50% in 2019, and annual returns of 25%, 54% and 50% in the three years before that, respectively.
A small Canadian hedge fund returned 116% in 2020 with bets on solar power and other clean energy stocks…. Favorable policy and economics may also prompt the industry to overbuild, so the fund is for now barely invested in solar stocks after “spectacular” share runs in 2020, said James Bradford, senior portfolio manager at Vivid [Capital Management].
Balyasny Asset Management brought on a net 40 new money managers across North America, Asia and the U.K. over the last year, pushing the total to 107, according to a person familiar with the matter. It also hired 60 analysts in North America, 22 in the U.K. and 10 in Asia./The Chicago-based firm’s flagship fund, Atlas Enhanced, gained 33% in 2020. That’s the best annual performance since 2007….
Hedge funds had their best year since 2009 but still can’t keep up with the stock market [MarketWatch]
Hedge fund Greenlight Capital’s strong fourth quarter gain lift 2020 return to 5.2% [Reuters]
David Einhorn Said a Tech Stock Bubble Had Popped. Now He Says It Hasn’t. [II]
BlueCrest’s 95% Gain Swells Michael Platt’s Wealth to $10 Billion [Bloomberg]
‘Solarcoaster’ Propels Small Toronto Hedge Fund to 116% Gain [Bloomberg]
Balyasny Boosts Ranks of Money Managers 60% in Blockbuster Year [Bloomberg]