Scaramucci’s SkyBridge hit with heavy redemption requests as fund fell: letter

BOSTON (Reuters) – Investors in SkyBridge Capital requested for a whole lot of hundreds of thousands of {dollars} again after the fund suffered a 23% loss in March when investments made by its debt-focused hedge fund managers soured, Anthony Scaramucci wrote in a letter to purchasers, saying he was “embarrassed” by the loss.

FILE PHOTO: Anthony Scaramucci, Founder and Co-Managing Partner at SkyBridge Capital, speaks in the course of the opening remarks in the course of the SALT convention in Las Vegas, Nevada, U.S. May 17, 2017. REUTERS/Richard Brian

“Redemptions were approximately 9.3% of assets as of March 31, 2020,” Scaramucci wrote in regards to the agency’s major portfolio, referred to as Series G. The letter was dated April 23 and seen by Reuters on Friday. The agency manages $7.7 billion in property.

SkyBridge, which invests with a handful of hedge funds, in flip submitted redemptions of greater than $1 billion to those managers with the intention to pay again its buyers and shift round its investments.

The agency had no remark past the letter.

Scaramucci, one of many hedge fund business’s best-known executives, mentioned that a lot of the corporations SkyBridge invests with, together with Bayview Liquid Credit Strategies, Metacapital Mortgage Opportunities, Medalist Partners Harvest and Tempo Volatility, had suspended redemption requests, which suggests buyers can not pull their cash out proper now.

He additionally detailed the Series G portfolio’s March losses, described new investments and mentioned {that a} long-serving government who had deliberate to retire was returning to full-time service.

“We are embarrassed by this performance,” Scaramucci wrote in regards to the agency’s 23.3% loss in March, which left the portfolio down 22.79% within the first quarter. The agency’s year-to-date loss has narrowed to 21.54%, because of a 1.62% acquire for the present month by means of April 21. The S&P 500 inventory index has misplaced 14.79% this yr.

“We have to do better, and we will,” Scaramucci wrote, noting that the fund made a $170 million funding with $22 billion hedge fund supervisor Canyon Partners on April 1, having waited for a distressed credit score cycle to make the funding.

Ray Nolte, SkyBridge’s long-time co-chief funding officer who had been transitioning into an advisory position, is again full time for not less than two years. “He is energized by the opportunity to lead the investment team and, once again, produce the attractive returns that marked the past fifteen years,” Scaramucci mentioned.

Scaramucci himself returned to SkyBridge, the agency he based in 2003, after a deliberate sale to Chinese conglomerate HNA Group fell by means of in 2018. He spent 11 days because the White House communications director in 2017 and has since spoken out broadly on financial and political subjects.

SkyBridge’s heavy investments in structured credit score — a guess that helped it just a few years in the past — contributed to this yr’s heavy losses, the letter mentioned. Angelo Gordon Mortgage Value Partners funds, Medalist Partners Harvest funds, and Axonic Credit Opportunities funds damage SkyBridge probably the most, the letter mentioned, noting that the funds have been “insufficiently hedged relative to their peers.”

Reporting by Svea Herbst-Bayliss; Editing by Leslie Adler


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