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July 18, 2024
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Hedge Funds

Haidar Overhauls Macro Hedge Fund Trades Amid Record 43% Plunge

(Bloomberg) — Macro trader Said Haidar’s clients suffered a dramatic reversal of fortunes last year as his leveraged bond market bets imploded. 

His Haidar Jupiter fund slumped 43.5%, posting the biggest annual loss since it started trading more than two decades ago, according to an investor letter seen by Bloomberg News. The decline, which follows a record 193% surge just a year before, has forced Haidar to make sweeping changes to his portfolio.

Short bets on bonds — the reason behind most of his losses — have given way to long wagers on the securities as Haidar expects major global central banks to cut interest rates in the first half of this year, according to a person familiar with the fund’s positioning. 

Japan is the only exception where the fund continues to short bonds on bets monetary authorities there will have to tighten rates. The fund has also reversed its short wagers on equities, the person said, asking not to be identified because the details are private. 

Jupiter fund’s monthly returns in 2023:

“Given further weakening of economic data all around the world excluding Japan, we appear to be entering into a period of global policy easing,” Haidar wrote to clients last month. “This will likely make for a supportive environment for both bonds and equities, while further weakness in commodities and the US dollar appears likely.”

The changes, which Haidar disclosed in a separate message to clients last month, helped the fund gain 12.4% in December and trim the year’s losses that had ballooned to as much as 50% at the end of November. 

A spokesman for Haidar Capital Management declined to comment.

Macro traders faced a challenging 2023 as they wrestled with the pace and extent of interest-rate hikes, and the timing of a potential policy pivot. The collapse of Silicon Valley Bank, which sent shock waves across global markets, particularly hurt hedge funds’ interest-rate bets earlier in 2023. 

Read More: Bridgewater’s Flagship Macro Fund Lost 7.6% Last Year

Haidar was one of the biggest losers amid the SVB debacle, slumping 32% to record its biggest-ever monthly decline in March.        

Haidar, known for running a high-octane strategy where double-digit gains or losses are frequent, started his eponymous hedge fund in 1997 and bets on macroeconomic shifts across the globe. 

He managed $1.3 billion in the fund at the end of November, down from $3.8 billion a year before, according to his newsletters.

Here’s a look at 2023 returns for other hedge funds:

–With assistance from Liza Tetley.

©2024 Bloomberg L.P.

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