In a year marked by extreme volatility, all four hedge funds of Ken Griffin's Citadel Securities have reportedly generated double-digit returns.
In September, the Wellington multi-strategy fund earned a return of 2.5% and a year-to-date return of about 29%, according to Bloomberg.
The Global Fixed Income fund of the company rose by 1.3% last month, taking the return to about 24% this year, the report said.
The Tactical Trading fund grew by 2.4% in September, boosted by fundamental long-short and quantitative equity strategies, pushing the gain to 21% this year, according to the report.
In September, Citadel Equities gained 2.5%, while its year-to-date performance reached about 17%, according to the report.
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The Eurekahedge Pte index that tracks hedge funds globally has lost 5.7% this year, heading for its worst annual performance since 2008. The MSCI World Index of stocks lost 22% this year.
The SPDR S&P 500 ETF Trust SPY has lost 20% since the beginning of the year. Bonds have lost their charm this year, as central banks hiked interest rates in order to rein in inflation. Since the beginning of the year, the Vanguard Total Bond Market Index Fund BND has shed more than 14%.
Why It's Important: Last month, Griffin expressed his opinion on the current economic environment, saying it is necessary to re-anchor inflation. The Citadel Founder said at the Delivering Alpha Investor Summit in New York City that once you expect it to become reality, it becomes the table stakes in wage negotiations. It is important to not let inflation expectations become unanchored. Griffin believes that it is possible to have a hard landing at the end of 2023.
Everyone likes to forecast recessions, and there will be one. It is just a question of when and how hard it is. Is there a possibility that we will have a hard landing at the end of 23? He said that's absolutely, according to the report.
The founder of Citadel, who started his career trading convertible bonds from his dorm room at Harvard, expressed his concerns about the U.K. government losing investor confidence.
I am worried about the loss of confidence in the U.K. Griffin said that it represents the first time that a major developed market has lost confidence in a very long time.