$32 billion money manager Angelo Gordon told investors its 'Super Fund' is up slightly for the year after big bets on Puerto Rican debt and Toshiba
- Angelo Gordon's $1.5 billion multi-strategy hedge fund, known as the Super Fund, has returned 3.4% through April, but a letter to investor says the firm has lost two portfolio managers that started the firm's liquid credit strategy.
- Michael Liebman and John Rudic resigned from the manager this quarter, the letter reads, after joining Angelo Gordon from Millennium in 2017.
- Out of the 12 strategies that feed into the Super Fund, only three have lost money so far this year, the letter states.
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Angelo Gordon's Super Fund, a $1.5 billion multi-strategy hedge fund run by the alternatives giant, has returned 3.4% through April, but recently lost two notable money managers.
The fund, which is comprised of 12 different strategies, was boosted by its positions in Puerto Rican Power Authority bonds and Toshiba stock, a letter to investors dated May 15 reads. The $32 billion money manager however lost Michael Liebman and John Rudic, two former Millennium portfolio managers that helped start Angelo Gordon's liquid credit strategy.The letter said Liebman and Rudic helped build a strong team of senior analysts and the strategy will not fold without them.
"We are pleased with the diversification and market neutrality Liquid Credit has provided, which is one of the primary reasons we added the strategy to the Fund in 2017. We remain dedicated to the strategy and team and see the strategy as an important aspect of Fund," the letter reads.
Liebman and Rudic joined in 2017 and were both managing partners at the firm. The letter also noted the January hire of Ryan Mollett as the global head of distressed; Mollett was previously a senior managing director at Blackstone's GSO Capital Partners.
Angelo Gordon declined to comment, while Liebman and Rudic did not respond to requests for comment.
The Super Fund's performance was solid, but still trailed the industry average of 6.52% through April, according to eVestment. The fund was slowed down by its investment into the debt of Sungard Availability Services, an IT firm that had its bonds downgraded several times since the beginning of the year, the letter stated.The strategy that contributed the most to the fund's performance was the distressed reorganizations sleeve, which was the investor in Puerto Rico's energy bonds. Liquid credit, the strategy run by Liebman and Rudic, was roughly flat before fees for the first quarter.
"'Alpha' took a back seat to 'beta' during the quarter, as performance was led by ETF/index bonds and fundamentals became less relevant," the letter's section on the liquid credit strategy said.
The letter also included a reference to the firm's view that M&A will continue to increase thanks to "unresolved geopolitical tensions and technological disruption across industries."
"An additional factor that could impact M&A is the upcoming 2020 US presidential election. Impending uncertainty around administrations, policies and potential delays typically leads to an increase in M&A volumes in the last years of a presidency," reads the letter, signed by Angelo Gordon cofounder and CEO Michael Gordon, portfolio manager David Kamin, and co-CIO Joshua Baumgarten.