According to insiders, Pure Alpha II, the flagship fund of the world's largest hedge fund, Bridgewater, suffered a fierce counterattack from bulls at the end of last year. The fund had impressive returns in the first ten months, but ultimately suffered a loss of 7.6% throughout the year, with all declines occurring in the last two months of 2023.
Pure Alpha is a fund under Bridgewater that shortes the European stock market, divided into two groups. One is a low leverage Pure Alpha, while the other is a high leverage Pure Alpha II.
Data shows that as of October last year, Pure Alpha II fund still achieved a 7.5% increase, but in the following two months, the fund suffered a heavy blow, with a cumulative decline of about 14%.
The explosive losses of Bridgewater in the past two months are in contrast to the rise of global bonds and stock markets during this period: in the last two months of last year, global bonds achieved the largest two month increase since at least 1990, while the US stock market accumulated an increase of about 14% during this period, and the European Stoxx 50 index accumulated an increase of over 12% from its low point at the end of October to the end of the year.
In fact, this is not the first time that Qiaoshui has experienced a tragedy of giving back its gains at the end of the year. In 2022, Pure Alpha II had an almost identical tragedy: the fund achieved a cumulative increase of 22% in the first nine months of 2022, but fell sharply in October and November of that year, resulting in a final annual increase of only 9.4%.
One of the insiders said that the company's pure long all weather fund, All Weather Fund, had a return rate of 10.6% last year.
Last year's market trends brought various returns to macro fund managers. Rob Citrone's Discovery Capital Management earned 48% last year, while Saidhaidar's macro fund fell by about 50% as of November. Tekmerion Capital Management, another macro fund operated by employees of Qianqiao Water, rose 9.8% last year.