Atticus Capital has lost more than $5 billion this year due to the demolition of 25%-32% of the capital in its two main hedge funds. It’s no wonder why rumours of Atticus liquidating its positions and closing up shop are being taken seriously. But, they’re not true, says the founder (WSJ):
“We’ve heard these rumours as well and they’re not true,” says Tim Barakett, founder of Atticus, which has [had?] about $14 billion under management. “We’re certainly not liquidating. In fact we have a large net cash position and are looking for opportunities to invest capital.”
Back in 2006, Barakett earned $675 million. Now, investors are shorting stocks that funds like Atticus own, anticipating capital redemptions by the funds’ LPs and therefore mass liquidations of these securites.
Here are two reasons, though, why Atticus may actually survive:
- there is no trigger allowing investors to pull their money out if heavy losses are incurred (unlike, say, Ospraie)
- the firm does not employ much leverage
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