London Hedge Fund Gains 70% from Betting on Credit Blowout
- The fund had a long-standing bet that spreads would widen
- Firm founded by ex-Credit Agricole trader during 2008 crisis
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Chenavari Investment Managers has racked up a 70% return this year after the hedge fund’s long-standing bet on credit-market turmoil paid off amid the coronavirus panic.
The firm’s $400 million Dynamic Credit Cycle Fund made the gains through March 12, according to people familiar with the matter, who asked not to be identified because the details are private. The fund uses derivatives such as credit default swaps to bet on companies’ ability to repay their debts.