Clint Carlson's hedge fund assets drop $1 billion in five months after brutal performance

  • Carlson Capital’s hedge fund assets dropped by $US1 billion in five months.
  • The firm’s Black Diamond Thematic fund lost 22.1% last year, with assets dropping more than $US300 million from August to December.

Assets at Clint Carlson’s investment firm have dropped by nearly $US1 billion in five months, client documents show.

The Dallas-based hedge fund managed $US8.2 billion firmwide at the start of 2018, down from $US9.1 billion in August 2017, according to documents seen by Business Insider. The drop was exclusively a result of a decline in hedge fund assets, with that business seeing assets fall from $US7.6 billion to $US6.6 billion. Carlson Capital’s collateralized loan obligation business in contrast saw a small increase in assets, now up to $US1.6 billion.

More than $US300 million of the decline in hedge fund assets can be attributed to Carlson’s Black Diamond Thematic fund. On August 1, 2017, that fund managed $US1.2 billion, per client documents. The fund managed $US854 million as of the start of this year.

That fund was the firm’s worst performer last year, falling 22.1% after fees, adding on to losses sustained earlier in 2017.

Carlson’s flagship multistrategy funds also lost money last year, losing -4.47% (Double Black Diamond, LP, $US2.2 billion) and -5.99% (Black Diamond Partners, LP, $US499 million), after fees.

Hedge funds on average posted gains last year while the stock market rallied, meanwhile. The HFR Fund Weighted Composite Index gained 8.5% in 2017. The S&P 500 was up 21.8%.

The firm’s other strategies posted net gains, meanwhile:

  • Black Diamond Relative Value Partners LP: +1.45%, with $US307.5 million in assets
  • Black Diamond Arbitrage Partners, LP: +6.85%, with $US86.5 million in assets

An external spokesperson for Carlson declined to comment.

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at research.businessinsider.com.au.