Huge Commodity Hedge Funds Astenbeck and Clive Capital Get Clobbered On The Oil Crash

hammer smash

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Oil crashed last week, and so did the world’s biggest commodity hedge fund, Clive Capital.The firm, based in London and run by former Moore Capital trader Chris Levett, lost over $400 million last week, according to the FT. It’s now down for the year.

Of course the $5 billion hedge fund isn’t the only firm that sustained significant losses when oil nosedived to $105.15 on Friday.

Astenbeck Capital, run by superstar trader Andy Hall, also reportedly recorded “double-digit percentage point losses.”

UPDATE:  “The flagship commodity fund run by top Phibro trader Andrew Hall suffered a 12 per cent fall last week as oil prices tumbled,” according to Reuters via Zerohedge.

An investor in the fund told Reuters:

The Astenbeck II fund, which was worth an estimated $2.6 billion in late April, took the hit as oil prices plummeted and commodities saw the biggest price drop in 2-1/2 years last week. Last week’s losses would have come to just over $300 million, based on those figures, and likely wiped out the year’s 10 per cent gains through March.

“All the big funds have been hit fairly hard (last week),” said the investor, “Astenbeck is down 12 per cent.”

Meanwhile, Clive Capital estimated losses at about 8.9% because of what is described as “extraordinary” price movements, the FT reported. “Clive’s management said it was at a loss to explain what had caused crude oil markets to be “annihilated”.” (Here’s a quant’s take on few things that might have caused it.)

Despite injuries to the portfolio, Levett’s firm believe that the “physical markets are quite strong… [So] we remain positioned in a number of markets.”

The firm has recorded returns of about 27% since Levett launched it in 2007.

Click here to read an investor letter from Clive Capital >

Click here to read what Clive was saying about commodities before the annihilation >