Exclusive: Loeb's Third Point outperforms hedge fund rivals again
Hedge fund manager Daniel Loeb outperformed his rivals again in the first quarter with returns that kept pace with the stock market's recent rally, a person familiar with Loeb's returns said.
The New York-based manager told investors late on Thursday that his flagship Third Point Offshore Fund rose 2.8 percent in March while the Third Point Ultra fund, the leveraged version of the Offshore fund, gained 4.2 percent.
For the year to date, the Offshore fund, with $5.6 billion in assets, is up 9.2 percent while the Third Point Ultra Fund gained 13.3 percent.
During the same time, the Standard & Poor's 500 stock index climbed 10 percent while it rose 3.6 percent during the month.
A spokeswoman for Loeb's fund did not immediately respond to a request for comment.
Low cost index funds, which oversee roughly $1.3 trillion worldwide, have been a hit with investors with the Vanguard 500 index, for example, gaining 10.57 percent this year.
Loeb, whose firm oversees roughly $11.6 billion, is traditionally among the first in the super secretive hedge fund industry to tell clients how he did during the month, carrying on a friendly rivalry with David Einhorn's Greenlight Capital to see who can be the first to inform investors. Hedge fund returns are rarely made public by their managers.
The Third Point numbers stand in contrast to many other hedge funds where returns have been tepid. Many investors have questioned why they should pay hefty management and performance fees for hedge funds at a time when straight stock investments are performing so well.
Einhorn also shared his returns with investors late on Thursday, reporting a 2.3 percent gain in his Greenlight Capital fund in March, leaving it up 6.1 percent for the year.
Star stock picker Leon Cooperman's Omega Advisors was up 6.55 percent during the first two months of the year and his son Wayne Cooperman's Cobalt Offshore fund was up 3.63 percent through February. John Paulson's Advantage fund lost 2.63 percent in the first two months of the year.
Loeb and Einhorn calculated their returns very quickly, sending their monthly numbers out even before the month ended just hours after trading concluded on Thursday and before Friday's holiday when U.S. stock markets and most European markets are closed.
Most hedge fund managers take a few business days to calculate their numbers and longer to pen their quarterly letters, which are expected to be released later highlighting trends in the first three months of the year.
Early indications show that 2013 is not starting on a strong note for the an industry that used to pride itself in making money in all markets. Hedge Fund Research data show most funds nearly flat for the month with only a 0.69 percent gain, leaving them up only 3.11 percent for the year.
Loeb has won praise from investors in recent weeks for moving in and out of trades more quickly than some rivals, for example, making money as nutritional supplements company Herbalife and for his so-called Japan macro trade where he was betting against the currency.
Einhorn has a more U.S.-focused portfolio, with Apple remaining one of his biggest bets. Even though the stock was tumbling late last year, Einhorn stuck with his bet and this year squared off against the computer maker first by suing it and later convening a public conference call to suggest Apple should adopt perpetual preferred shares to send more cash back to investors.
(Reporting By Svea Herbst-Bayliss; Editing by David Gregorio)