Phil King, Co-Founder and CIO of Regal Partners, has acknowledged the misjudgment behind the firm’s high-profile investment in Opthea Ltd, which has been written down to zero, but says the biotech blowup has not triggered any investor redemptions, according to a report by Bloomberg.
Speaking at the Macquarie Australia Conference, King offered a candid assessment of the failed AUD200m position in the eye-treatment developer, calling it a “mistake” and emphasising the risk management takeaways that will influence Regal’s investment framework going forward.
“It’s not the first mistake I’ve made, and it won’t be the last,” said King. “But I’m not aware of any redemptions as a result of that.” The firm, which manages a multi-strategy platform across public and private markets, has been recalibrating its exposure to binary, event-driven bets in response to the loss.
Regal has indicated that future allocations to high-conviction, high-risk trades – particularly those tied to clinical trial outcomes – will be capped at significantly lower weightings across its portfolios. The decision comes amid wider industry scrutiny of concentration risk in hedge fund portfolios, especially in volatile sectors like biotech.
Despite the setback, King noted that May had started on a positive note, though he declined to provide specifics on portfolio performance. Regal has been actively expanding beyond its equity long-short roots, with new strategies including private credit and real assets.
While shares in ASX-listed Regal Partners have fallen more than 40% year-to-date, the stock has begun to stabilise in recent weeks as the firm pivots toward more diversified sources of alpha.
