One year ago
»» Quantitative Investment Management, the Charlottesville, Va., managed futures firm, planned to enter as many as 30 new futures markets and tweak its leverage policy to allow for more flexibility. “We sought to develop a better way to de-lever during periods of subpar performance while also allowing for a smoother return to full leverage as performance improves,” wrote QIM chief executive Jaffray Woodriff in a March 2011 letter to investors.
Following its old policy, QIM could only lever and de-lever in 25% increments, a step function that was less flexible than the new policy.
The new tactics may have helped turn around its flagship Quantitative Global Program, which gained 4.03% last year after losing 3.40% in 2010. By comparison, the AR Managed Futures Index lost 2.98% last year. This year, however, the fund is down 5.81% in the first two months of 2012, which QIM blamed on “poor trading in interest rate futures” in a February performance update to investors.
Overall, QIM’s assets grew 3.25% last year to $4.61 billion, according to AR’s Billion Dollar Club rankings.
A spokesman for QIM did not respond to a request for comment.
See also: QIM’s Tactical Aggressive Fund among those up more than 20% in 2011 • QIM reopens to new investors despite flagship’s flagging performance • AR's profile of QIM’s Jaffray Woodriff
»» Sprott Asset Management, the $1.95 billion Canadian firm, took the view that gold was far from a bubble—in fact it was a “surprisingly under-owned asset class” with room to appreciate.
Founder Eric Sprott and research analyst Andrew Morris examined the relative amount of capital market activity in the gold equity markets and concluded there was “no indication of a bubble whatsoever.” They added that “Gold may be trading at all-time nominal highs, but a look at investment flows proves that it isn’t anywhere close to being overbought.”
Though the commodity continued to climb in 2011, rising 3.10% (data here), some hedge funds began exiting their positions toward the end of the year.
Sprott and Morris are sticking to their thesis. “Despite yet another year of gold outperformance, the public remains far too underinvested in gold for any claim of a speculative bubble to hold weight. Western central banks in their increasingly desperate attempts to preserve the status quo - which we all know is flawed - have only served to reinforce the growing consensus that any prudent investor should hold at least some portion of their assets in unencumbered physical bullion,” they wrote this week in an email to AR.
“However, as we highlighted last year, a dearth of investment over the past several decades has left investment portfolios grossly underexposed to precious metals. Bringing gold holdings back up to meaningful levels will require much greater investment flows and manifestly higher prices.”
See also: Warren Buffet is wrong about gold…again, Gold at $1,800 is a fool’s bet
Five years ago
»» Conquest Capital Group head Marc Malek had some colorful words for the U.S. Federal Reserve’s monetary policy tightening efforts. “It takes some time to wake up from a drunken stupor. We are there now,” he said, referring to the previous long cycle of easy credit.
The past five years have been mixed for Conquest’s $779 million flagship macro fund. It gained 20.88% 2007 and 45.59% in 2008, but suffered losses in 2009 and 2011 (data here).
Conquest spokeswoman Jessica Grad did not respond to a request for comment.
See also: Conquest adds in-house marketer • Conquest blames big brother