Dutch hedge fund specialist Theta Capital Management has added VR Global Offhore Fund Ltd (VR Global) to its flagship Legends Fund.
VR Global, which is run by Richard Deitz, supported by a team of nearly 40 people and offices in London, New York, Moscow, and Dubai, predominantly invests in distressed debt and specialises in emerging markets.
The Legends Fund, launched in February 2010, allocates to a selection of 10-15 ‘legendary’ hedge fund managers. This way it offers access to some of the most renowned money managers that are typically closed to new investors. The selection of managers in Legends Fund achieved net returns of over 15 per cent per annum over their average track record of close to 19 years. With the Legends Fund, Theta Capital also aims to reduce operational hurdles for hedge fund investors, producing a daily NAV and facilitating intra-day trading on Euronext Amsterdam.
VR Global is the most recent underlying manager to be added to the Legends Fund’s roster of underlying hedge funds hat includes some of the most established hedge fund names such as Moore Global Investments, Lansdowne Developed Markets, Pershing Square and Millennium International. With VR Global’s focus on distressed debt, mostly in emerging markets, it adds a further specialisation to the Legends Fund.
In Theta Capital Management’s view the prospects for VR Global’s strategy have been improving recently given important political shifts in countries in which VR historically has been very active, such as Argentina and Venezuela. They believe the unrest in Brazil could well open up another great source of returns as does the general state of credit markets with an increasing number of dislocations.
Ruud Smets, Portfolio Manager of the Legends Fund, says: “Deitz deploys a contrarian investment style and typically enters situations at the time of maximum turmoil when other investors flee. It is such ‘orphaned’ assets that provide the return potential the manager is after. Illustrative of its strategy, the largest contributions to its excellent 2015 returns came from Ukraine, Greece and Argentina, three markets shunned by most investors. This once again showed that they’re able to produce great returns, also in difficult credit markets. They may have a less visible profile than most of the other Legends, they are definitely in the same league and with the majority of its USD3 billion under management being internal capital they are well aligned. We have been invested with VR Global for more than 12 years and given this long relationship, they have allowed us to build a position in Legends Fund while being closed to new investors."
