Caxton Going Down?
We’re hearing rumors that Caxton Associates is blowing up. Caxton is one of the largest hedge funds in the world with around $16 billion under multi-strategy management so this would be huge and, as they say, unlikely. Some are saying it’s because of the move SEPR has made of over the past few weeks (Caxton’s largest equity position had been SEPR), others that it’s the very fashionable credit situation. Right now, all just hearsay. Maybe funds this large don't blow up. Maybe Caxton was already a red giant, and will contract into a white dwarf under a sea of redemption requests after some significant losses. Only then will it be ready for a supernova. Heard anything? You know where to find us.
Update: Caxton denies any such rumors. According a friend o' DealBreaker, there was a "larger than normal liquidation in order to reduce risk," the main fund is down 3-4% mtd and Caxton "made money today." Make of that what you will.
Comments
"Unlikely"?
All sorts of shit is unlikely, and yet still happens. LTCM "wasn't supposed to happen." Apparently million-to-one-shots happen every single moment of every day.
Posted by: Zbignew | July 31, 2007 03:32 PM
thank you, zbignew
Posted by: ass | July 31, 2007 03:34 PM
i doubt it, but shit happens
Posted by: em | July 31, 2007 03:44 PM
Looking at the 13-F, it just doesn't seem possible that a 280M position in SEPR could cause a 17B fund any problems. Even if the entire position was wiped out, they'd only lose 1.7%.
I'm still confused about Sowood. How does someone file owning 6.5B in equities and options lose 1.5B on 3B in capital?
Short story, 13-Fs are misleading
Posted by: joe | July 31, 2007 03:52 PM
hmm, maybe they employed leverage?
Posted by: joe marmar | July 31, 2007 04:00 PM
joe - 13Fs are really meaningless for multistrats and fixed income players.
1) Most fixed income positions don't show up in the filing
2) International positions aren't filed
3) You can't tell how much leverage they're running
So with Sowood, you don't see their 7x levered bank book, which ultimately caused their downfall
Posted by: PBateman | July 31, 2007 04:00 PM
hmm, maybe they employed leverage?
Posted by: joe marmar | July 31, 2007 04:00 PM
Joe, just one word explains it...leverage. Get used to that word if you want to work on Wall Street.
Posted by: Anonymous | July 31, 2007 04:01 PM
the first joe doesn't know preferred stock from livestock
Posted by: Ajax | July 31, 2007 04:04 PM
Ajax, i agree, but the first Joe knows a LOT about what life is like for a guy whose face is perpetually covered in mushroom bruises.
Posted by: BSD is a dick | July 31, 2007 04:08 PM
Zbignew: Apparently million-to-one-shots happen every single moment of every day.
It depends on who is making the odds.
Posted by: Mep | July 31, 2007 04:14 PM
no value add comment:
HAHAHAHA such highbrow humor and sophisticated insults
Posted by: jt | July 31, 2007 04:14 PM
looks like faber debunked you just like he debunked the txu people
Posted by: Anonymous | July 31, 2007 04:18 PM
somebody from caxton reads dealbreaker, and should really take it upon themselves to confirm or deny said reports
Posted by: em | July 31, 2007 04:31 PM
who is BSD?
Posted by: the other BSD | July 31, 2007 04:45 PM
hey, jt: suck a dick
Posted by: Anonymous | July 31, 2007 05:05 PM
Caxton denied this rumor directly to Ms. Levin shortly after the story was posted. As noted to DealBreaker, Caxton continues to trade normally and profitably for the year.
Toby Young
Director of Investor Relations
Caxton Associates
Posted by: Toby Young | July 31, 2007 05:33 PM
I like Toby responding. Very solid.
Posted by: AJ | July 31, 2007 05:59 PM
Toby - is it true your fund was up 12% going into last week and finished the month down 7%?
Posted by: Anonymous | July 31, 2007 07:55 PM
Toby - is it true your fund was up 12% going into last week and finished the month down 7%?
Posted by: PBateman | July 31, 2007 07:56 PM
God, I love Seinfeld
Posted by: Chuck Prince | July 31, 2007 09:09 PM
yo chuck, get yo head outta yo ass and do something about the fucking stock price
Posted by: Ajax | July 31, 2007 09:34 PM
hey anonymous @5:05 - way to prove my point, this shit is fucking hilarious!
Posted by: jt | July 31, 2007 11:48 PM
Will two two please get a room, jt you must be the catcher, right?
Posted by: Former Eye-Patch Wearing Joker | August 1, 2007 03:47 AM
What is SEPR?
Posted by: henry teoh | August 1, 2007 04:21 AM
SEPR = Sepracor, makers of Lunesta.
Posted by: I love to help henry! | August 1, 2007 12:59 PM
Wall St's in great hands with guys who don't know what leverage is or what SEPR is.
Posted by: Ajax | August 1, 2007 03:12 PM
Caxton's holdings presently are:
-Equities 6 Billion
-Fixed Income 12 Billion
-Currencies 1 Billion
-Commodities 0.5 Billion
Now, if Caxton's size is 11 Billion, take
out a pocket calculator and you'll get
the leverage.
Value at risk (VaR) presently is 0.5.
Last month it was 0.6 and in Average
it is between 0.4 to 0.8
Caxton has over 2000 Equity positions,
both US and international (ADR).
Posted by: Goldpalm | August 3, 2007 11:27 PM