Hedge fund trust Third Point Offshore Investors has solid start to 2019 – Third Point Offshore Investors (TPOU) announced in December 2018 that it would migrate its entire portfolio into a newly-created share class of the underlying Master Fund managed by Dan Loeb and his team (you can read more about this story here). TPOU saw its NAV total return decline by 10.9% in the year to December 31, 2018, as its equity long and corporate credit strategies underperformed.
The company focuses on four strategies where it believes it has a competitive advantage in markets: activist and governance-focused investments; credit securities; short selling; and identifying emerging compounder securities. .
Steve Bates, chairman of the trust, had this to say on 2018 and the year-to-date performance thus far: “The results for the year were disappointing, with particular weakness visible in the fourth quarter. For the year ended 31 December 2018, the NAV per share performance decreased by (10.9%) for the U.S. dollar share class. Performance was driven primarily by losses in core equity long positions against a challenging broader market environment and a significant rise in market volatility. I am happy to report that for the first three months of 2019, the NAV has increased by 9.8%. I am encouraged by the changes the manager enacted toward year-end including a deleveraging across the portfolio, a reduction in net equity exposures, and a focus on increasing the short equity portfolio.”
Addressing the persistent discount
TPOU discussed the long-standing high discount to NAV its shares have been trading at in its recently published annual report. The company will look to address this point over the rest of the year and it is an issue we have discussed previously. Click here to read more on this story.
TPOU: Hedge fund trust Third Point Offshore Investors has solid start to 2019