Naspers Bet Helps Laurium Fund to November Gain as JSE Retreatsby
Aggressive Long Short fund up 1.7% in Nov. as market falls 4%
South African hedge fund largely avoided mining companies
South African hedge fund manager Laurium Capital’s Aggressive unit beat the market last month by investing in media and technology firm Naspers Ltd., the country’s largest company, while betting against stocks tied to the ailing local economy.
The Laurium Aggressive Long Short Fund returned 1.7 percent in November compared with a 4.1 percent loss in the FTSE/JSE All Share Index, firm co-founder Murray Winckler said by e-mail. The fund advanced 23 percent this year through last month compared with the 4.2 percent gain in the benchmark index, he said.
“Our hedge funds did well in November relative to the sharp fall in the market mainly as a result of long positions in Naspers, Tencent Holdings Ltd., Nampak Ltd., Tiger Brands Ltd. and foreign property stocks,” Winckler said. “Very little commodity or mining exposure and short positions in a few stocks with exposure to the domestic economy helped the performance.” He declined to name the shorts, bets that shares would fall, saying the information is sensitive. Naspers has a 34 percent stake in Chinese Internet business Tencent.
South African mining and industrial companies have suffered from a China-led commodity slump and the country’s economy narrowly avoided a recession in the third quarter. Naspers climbed last month as it reported first-half earnings rose as much as 42 percent. Nampak recorded its largest two-day gain since 2013 after the beverage-can maker signed a deal in Angola.
“This month is going to be a lot more challenging,” Winckler said.