Talpins’s Hedge Fund Element Raises $2 Billion in 2 Weeks

  • New money brings firm’s assets under management to $12 billion
  • Majority of the cash is said to come from existing investors

Element Capital Management, the firm run by Jeffrey Talpins, raised $2 billion in two weeks as investors show growing interest in hedge funds that focus on macro economic events.

The new money brings the firm’s assets under management to $12 billion, according to a person with knowledge of the matter. Element reopened its macro fund to investors on March 1 and turned away additional requests after reaching its target by March 15.

Most of the commitments came from existing clients, said the person, who asked not to be identified because the information isn’t public. Element had been closed to new cash since last April, when it gathered $1.5 billion in one month. Shawn Pattison, a spokesman for the New York-based firm, declined to comment on the fundraising.

Element, which has fewer than 40 investors, is among the more sought-after hedge funds. Last year it gained 19.4 percent, making it one of the world’s best-performing macro funds, and in 2015 it rose almost 23 percent. Since its 2005 inception, the fund has returned an annualized 21 percent, the person said.

‘Uncertain’ Road

The macro strategy is becoming increasingly popular in a world rife with political uncertainty, attracting investors who believe managers wagering on currencies, bonds, stocks and commodities may be positioned to profit from higher volatility in global markets.

Macro funds got net inflows of $1.1 billion in January after redemptions of almost $10 billion last year, according to data tracker eVestment. Global macro topped a list of the most attractive strategies for investors in a recent Credit Suisse survey. And 27 percent of hedge fund investors polled by Deutsche Bank said they plan to add to their macro allocations in 2017. “The political road ahead appears equally, if not more, uncertain as policy makers globally diverge in their approach to spur economic growth,” the bank said in its report.

Even so, macro managers as a group have underwhelmed in 2017. They returned 0.4 percent through February, according to Hedge Fund Research Inc., while the average hedge fund rose 2.2 percent.

Element, which has posted gains this year, isn’t the only prominent hedge fund reopening to investors. In the second quarter, Paul Singer’s $32.8 billion Elliott Management will let investors allocate new capital to its multistrategy fund. Earlier this year, Chris Rokos’s macro fund raised $2 billion and declined additional investment requests even before its scheduled reopening on Feb. 1.

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