Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

A legendary trader who made billions betting on wars, other macro events is hanging it up

A legendary trader who made billions betting on wars, other macro events is hanging it up

Longtime trader and hedge fund manager Louis Bacon is planning to return capital to investors after 30 years of investment. Bacon, who founded Moore Capital in 1989 with a $25,000 inheritance from his mother, is considered one of the most successful traders of his era. He rose to Wall Street fame making bets on everything from U.S. equity to European bonds and Asian currencies based on global events.
Longtime trader and hedge fund manager Louis Bacon is planning to return capital to investors after 30 years of investment.

The step to privatize Moore Capital will mark the end of a storied era at the firm and follows years of weaker performance at the fund.

“The time is propitious to take a step I have eyed for some time and ‘privatize’ our three multi manager flag ship funds — that is to say returning client assets,” Bacon wrote in a letter to clients viewed by CNBC.

“Disappointing results of these funds of the last few years obviously inform this decision but our long term record is one we remain proud of,” he continued. “Intense competition for trading talent coupled with client pressure on fees has led to a challenging business model for multi manager funds such as ours.”

Moore has delivered a net annualized return of 17.6% and a cumulative return of over 21,000% since inception for its flagship Remington funds but has returned low-single-digit gains this year, the manager noted.

Bacon, who founded Moore in 1989 with a $25,000 inheritance from his mother, is considered one of the most successful traders of his era. Bacon popularized trading on a “macro” basis, making bets on everything from U.S. equity to European bonds and Asian currencies based on what he expected from the global macroeconomy.

In Moore’s first full year, his wager that Saddam Hussein would invade Kuwait generated an 86% return, according to a letter Bacon wrote to document his firm’s first 20 years. The letter also said that 13 years later, Bacon’s accurate predictions on the market events surrounding the Iraq war would buoy fund returns 35%.

His fund also successfully bet against Japanese markets in the early 1990s and at one point managed more than $10 billion.

The most recent decade, however, proved tougher for Bacon, who scrambled to match his historical returns thanks to persistently low interest rates. A Moore fund managed by Bacon reportedly declined almost 6% in 2018 amid two spikes in market volatility; another company fund overseen by other managers fell 3.3%, according to the Financial Times, which first reported Moore’s impending closure.

“Challenging trading conditions and muted returns for our macro multimanager funds of late masks a vibrant success at Moore in our Long/Short Equity platform, our Private Equity and Venture group, our Real Estate and our Speciality Lending businesses,” Bacon wrote in the letter to investors.

But he isn’t the only fund manager who has struggled in recent years.

Billionaire Leon Cooperman announced the closure of his Omega Advisors in summer 2018, telling clients that he doesn’t “want to spend the rest of my life chasing the S&P 500.”

Fellow billionaire Jeffrey Vinik, who made a name for himself running Fidelity’s Magellan fund, told CNBC last month that he was closing his hedge fund less than one year since its relaunch.

“It has been much harder to raise money over the last several months than I anticipated,” Vinik said in a letter dated Wednesday to investors.

“The climate for raising long-short equity hedge fund assets has been far more difficult than I expected, and performance of the VAM funds, while good ... has not provided the necessary momentum to bring in our desired level of investments.”
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Russia’s A7 Builds a State-Linked Payments Network Beyond Western Sanctions
AI’s Next Bottleneck Is Power, Not Just Nvidia Chips
Meta Raises AI Spending Target to as Much as $145bn Despite Pressure Over Returns
Danube Drought Exposes Nazi Wrecks and Pushes Central Europe’s Power System to the Brink
Joe Biden’s Cancer Has Spread Beyond His Bones, Hunter Biden Says
Why 2027 Could Be a Strong Year for Stocks—and Why the Forecast Is Fragile
Why Markets May Look Quiet in August After Big Tech Earnings
UK Drought Cuts Harvests and Raises Food-Security Fears
UFO: Pentagon Releases Video of Unidentified Object Tracked Over Middle East
Ukraine Tells Senate Republicans Its Drone War Offers a Blueprint for America
Weight-Loss Drug Boom Tests the Limits of Prescription Advertising Rules
Senate Scrutinises AI-Driven Personalised Pricing
Spain Seeks Mainland Transfers for 1,100 Children Stranded in Ceuta
Spain and Morocco Trade Blame After 72,000 Migrants Enter Ceuta
AI Is Remaking the US Economy, From GDP Growth to iPhone Prices
Europe’s Heat and Drought Are Now Disrupting Power, Shipping and Tourism
Europe’s Drying Rivers Trigger Power Cuts, Factory Shutdowns and Wildfire Emergencies
Record-Low Danube Forces Nuclear Cuts and Emergency Power Curbs
Danube Drought Forces Hungary’s Paks Nuclear Plant Into Full Shutdown
Ceuta Death Toll Rises as Spain and Europe Clash Over Border Response
Valued at $109 Million: F-35B Fighter Jet Crashes in Southern California
Record-Low Danube Exposes Probable Mammoth Remains in Bulgaria
US Says It Has Carried Out Heavy Strikes on Iran After Attempted Attacks on Its Forces
The AI User Nightmare: Private Claude Conversations Leaked to the Internet
Over 24 Hours in the Air: Qantas Airbus Completes Record-Breaking Test Flight
Massive Wildfires Ravage Southern Europe: Fatalities in Greece and Evacuations Across France, Spain, and Turkey
Nvidia Reportedly Takes Vast Texas Data-Centre Lease to Underwrite AI Expansion
FIFA’s Private-Investment Plan for World Cup Rights Draws European Revolt
Apple Briefly Crosses Five Trillion Dollar Valuation as Investors Retreat From AI Bets
Fresh Heatwave Threatens to Rekindle France’s Historic Wildfire Crisis
Following OpenAI's Cyberattack: 'Most Companies Still Do Not Understand What Is Coming'
OpenAI Sued After ChatGPT Allegedly Discouraged Emergency Care Before Near-Fatal Embolism
Miliband Sets Climate and International Law at Centre of UK Diplomacy
Czech Central Bank Governor Rejects Early Euro Entry and Rate-Cut Pressure
Trump Readies New Tariffs as Temporary Global Levy Nears Expiry
Vivienne Westwood Casts Cicciolina, 74, in Its New Autumn Campaign
Dejavu: Germany’s Military Expansion Reshapes Europe’s Strategic Balance With France
Morgan Stanley Builds a Wall Street Lead in AI Infrastructure Finance
High Prices Push Coffee Drinkers Toward Whole Beans and Home Brewing
Trump Draws Boos and Podium Scrutiny at Spain’s World Cup Triumph
Brilliant move: Péter Magyar Moves to Nominate Chess Grandmaster Judit Polgár as Hungary’s President
Spain Defeats Argentina in Extra Time to Win Second World Cup
Current AI Seeks to Build an Open Global AI Infrastructure Outside Big Tech Control
Germany’s Economic Malaise Reopens the Sunday Shopping Debate
Proposed U.S.-Saudi Nuclear Pact Could Permit Limited Uranium Enrichment Under International Safeguards
Netherlands Declares Water Shortage Emergency After Drought Pushes Rivers to Historic Lows
Why Kentucky Fried Chicken Became KFC—and Why the False Explanations Persist
Ukrainian Drones Strike Wildberries Warehouses Deep Inside Russia
Reported CIA Mission Helped Clear the UAE’s Path to Advanced US AI Chips
Artificial Intelligence Capital Fuels Markets While Governments and Regulators Face Mounting Strategic Tests
×