BOSTON, March 5 Bridgewater Associates' Pure
Alpha fund, one of the world's biggest hedge funds, gained 3.04
percent last month, thanks in part to its investment in gold,
which scored its biggest monthly gain in seven months.
The increase left the fund, which invests roughly $80
billion and is a favorite with pension funds and sovereign
wealth funds, up 2.89 percent for the first two months of the
year, according to a person familiar with the numbers.
A spokeswoman declined to comment.
Spot gold prices jumped 7 percent in February amid concerns
that the U.S. economic growth is slowing.
Returns at Bridgewater - the firm also runs the $70 billion
Bridgewater All Weather fund - are closely watched by the
investment community because of the firm's strong track record.
The Pure Alpha fund has returned 13.6 percent on average
every year since it was launched in 1991. Last year, however,
the fund's 5.25 percent return lagged the average hedge fund's
9.3 percent return.
Hedge funds and money managers raised their bullish bets on
gold futures and options in late February, according to data
from the Commodity Futures Trading Commission, after a
lackluster gain in home prices fueled speculation the Federal
Reserve might slow the tapering of its bullion-friendly bond
In general, February was a difficult month for so-called
global macro funds that make speculative bets on economic
trends. Paul Tudor Jones' BVI Global fund dipped 0.8 percent
last month, leaving it down 2.9 percent for the year, an
investor in the fund said. A spokesman declined to comment.
"Conversely, global macro and (commodity trading advisers)
posted mixed results - several longer-term conviction trades
detracted from performance, such as long U.S. dollar and the
Japan reflation," said Anthony Lawler, a portfolio manager with
GAM Alternative Investment Solutions.
But Robert Citrone, who has been running his Discovery
Capital Management since 1999, came roaring back with a 3.8
percent gain, leaving the fund up 2.57 percent, a person
familiar with the numbers said.
William Ackman's $12 billion Pershing Square Capital
Management also extended this year's strong gains with a 7.4
percent increase in February, thanks to bets on mortgage finance
companies Fannie Mae and Freddie Mac, an investor in the fund
said. Bets on Air Products, real estate developer Howard Hughes
and Burger King also helped. The fund is up 11.7 percent for the
year, even as Herbalife is still weighing on performance.
Ackman claims Herbalife is running a pyramid scheme.
The company denies the accusation.