Australian hedge fund Caledonia delivered mixed results over the past year, as strong gains in selected equity positions were offset by weaker performance from several of its largest holdings, according to a report by the Financial Review.
The report cutes unnamed people familiar with the mater as revealing that the fund, run by Will Vicars and Mike Messara, generated a 14.6% return over the 12 months to 31 December. While the performance exceeded Australia’s S&P/ASX 200, which rose 6.8% over the period, it lagged major global benchmarks including the S&P 500 and the MSCI All Country World Index. Returns were also below Caledonia’s internal target range of 15% to 20%.
Performance was flat in the six months to year-end, highlighting the uneven contribution across the portfolio.
One of the fund’s strongest performers was gaming equipment group Light & Wonder, one of Caledonia’s largest exposures. The company’s shares have rallied sharply since consolidating its Australian listing late last year, rising from around AUD109 in October to more than AUD170 by mid-January.
Caledonia has also benefited from its position in Cameco, the Canada-listed uranium producer. The fund began building its stake following market volatility triggered by US trade tariff announcements last year, with the stock rising more than 200% since that period. Another positive contributor has been Royalty Pharma, whose shares are up around 30% since Caledonia invested in the drug royalties group.
However, gains were tempered by declines in two of the fund’s most high-profile holdings. Caledonia remains the largest shareholder in US property platform Zillow, where its stake is valued at more than AUD1.8bn. Zillow shares fell nearly 8% over the year amid concerns that artificial intelligence-driven platforms could disrupt the online real estate classifieds market.
Flutter Entertainment, in which Caledonia owns roughly 4% of the bookmaker’s share register, also weighed on performance. The stock declined close to 17% over the period as investors fretted over potential regulatory tightening and rising competition from newer betting platforms.
