People with knowledge of the matter said that Tybourne Capital Management is shutting down its $2.8 billion hedge fund, retreating from bearish bets that have become increasingly difficult to make money from.
None of Boris Johnson's furious MPs worry that his next misstep could be fatal.
The Hong Kong-based firm will shift its focus to its long-only and private investment funds, said the people, who asked not to be identified because the information is private. The people said that the company plans to return money in the Tybourne Equity Master Fund to investors over the coming months and waive performance fees in the interim.
Tybourne is following the withdrawal of Lansdowne Partners from short-selling activities, one of the hallmarks of hedge funds. The people said it told investors that growing passive money flows, market leverage and retail investor participation in markets have fueled volatility, hurting especially short bets.
The former Lone Pine Capital LLC Asia head Eashwar Krishnan started the Tybourne hedge fund, its first, more than nine years ago. People with knowledge of the fund said that the fund lost 10.5% in November, making this year's decline to more than 16%. The people said it returned more than 53% last year.
Tybourne is known for taking focused bullish bets on high-growth companies, such as Singapore-based online gaming and e-commerce provider Sea Ltd. The firm has around $8 billion in assets, including money in a fund that makes late-stage investments in private companies before they go public.
In July of last year, Lansdowne announced that it was closing its $2.8 billion hedge fund after being hit by some of its worst-ever losses. It retained the ability to take bearish bets in some other funds.
Retail investors have been thwarting the practice of selling borrowed stocks to buy them back at lower prices. In January of this year, Reddit traders began using Melvin Capital Management's previously reported put options as a proxy for the New York-based firm's short positions. The prices of heavily shorted stocks went to astronomical levels within a few weeks, most famously GameStop Corp., which soared to an intraday peak of $483 on January 28 from less than $20 at the beginning of the year. Melvin had to close out of its short positions with a fund loss of nearly 55% in January.
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