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12/03/2012

Two Fort Worth hedge fund managers tell investors they're closing funds

Two Fort Worth-based hedge funds are calling it quits.

Kleinheinz Capital Partners and Corriente Advisors have both sent letters to investors telling them they will be winding down funds, Bloomberg News reported last week.

In a letter obtained by Bloomberg, John Kleinheinz, who turns 51 on Thursday,dec.6  says: “I am not enjoying running the fund as much as I used to. ... Managing a fund like ours requires me to do a lot of things that make me a less effective investor.”

The firm, founded in 1996, directs the Global Undervalued Securities fund. In an annual disclosure, Kleinheinz Capital reported that it had $4.3 billion in assets and 24 employees as of Dec. 31. On Friday, Kleinheinz Capital told the Star-Telegram it would have no comment on the report.

Kleinheinz informed investors that the firm’s Mark Stupfel plans to start his own firm next year and will hire some of Kleinheinz Capital’s analysts and administrators.

Corriente, founded by Mark Hart, told investors that it’s closing its master fund after almost four years of “extremely poor and disappointing performance.” Previously, the fund handed investors a sixfold gain betting against U.S. subprime mortgages during the financial crisis.

The poor results since early 2009 are due to Hart “taking a far too bearish stance on risk assets in general and on the sovereign debt crises in Europe and the economic situation in China,” he wrote.

Hart blamed central bank and government intervention for reducing volatility and making macro investing more difficult, Bloomberg reported. He didn’t return a call seeking comment.

He told the investors that he’ll continue managing European and China funds.

During this year’s political campaign, Kleinheinz turned up on a list of the country’s 100 biggest donors, having donated $1 million to a political action committee, Restore Our Future, supporting Mitt Romney.

-- Jim Fuquay

 

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