Loeb's hedge fund outperforms peers with returns 25.2% returns in 2013
Daniel Loeb, the activist investor and hedge fund manager, led rivals in 2013 as his flagship fund gained 25.2%, Reuters reported. With bets made on Greek bonds, blue-chip US stocks and the economic recovery in Japan, Loeb's $14 billion firm Third Point has been one of the top performers in the industry for past few years now.
Citing a client who got a performance update from Loeb on Thursday, the report said the Third Point Offshore fund posted a 2.3% gain in December. The Third Point Ultra fund gained much higher at 3.4% in the same period and ended the year up 37.9%. The Ultra fund is a smaller fund that utilizes borrowed money to increase returns.
The report said that the figures were higher than the 6.5% global average returns posted by hedge funds last year. They also kept pace with the benchmark Standard & Poor's 500 Index which rose 29.6%, its strongest yearly gain since 1997. Loeb, however, did not give details on the investments that allowed his funds to get robust returns. In the last month of last year, majority of his investments were placed on large US stocks, the report said. More information about his portfolio is expected to be unveiled in the following weeks when he distributes his fourth quarter letter to investors.
When the third quarter ended, Loeb's three biggest bets were Yahoo, American International Group and Sotheby's. He also held stakes in FedEx Corp and Japan-based Softbank Corp.
Compared to 2012, last year was better for Third Point as the fund returned 21.1% while the Third Point Ultra fund increased 33.5%, the report said.
He recently stopped accepting clients and has now given back some capital back to its existing investors. According to the report, Loeb said his fund should not exceed $14 billion as it would be more difficult to invest the extra money.