A year after posting his first-ever annual loss, Brazilian hedge fund manager Rogerio Xavier, the Co-Founder of SPX Capital, saw the SPX Raptor fund – a variant of its flagship Nimitz fund – outperform 96% of its peers, according to a report by Bloomberg.
The Raptor fund surged 22% after fees, doubling the industry benchmark and nearly quadrupling the gains of a composite index of local hedge funds.
Currency trades, particularly bets on a strengthening US dollar, were the primary drivers of the fund’s stellar performance, according to sources familiar with the strategy. Additionally, the fund reaped significant gains from positions in interest rates and equities, the unnamed sources reportedly said.
A recent investor note obtained by Bloomberg outlines the fund’s continued strategy: maintaining long positions on rising interest-rate futures in Brazil, holding a bearish stance on local equities, and positioning for the US dollar to appreciate against a basket of currencies.
SPX Capital’s Global Eagle fund, which caters to offshore investors, also had an impressive year, gaining 14.3% in US dollar terms after fees, the sources added.
This rebound marks a significant shift for Xavier. In 2023, he issued a rare apology to clients following the fund’s first negative performance year since its 2010 inception. Missteps in navigating Brazil’s political turbulence and macroeconomic dynamics were largely to blame for the loss, which Xavier described as “disappointing.” Despite the setback, he reiterated confidence in SPX’s business model and its global expansion strategy.
Founded in Rio de Janeiro by Xavier, Daniel Schneider, and Bruno Pandolfi, SPX Capital manages BRL62bn ($10.2bn) in assets. Over recent years, the firm has bolstered its global presence, hiring Senior Portfolio Managers in financial hubs such as Singapore and the United States.
Bloomberg’s analysis of Brazilian hedge funds, which includes only multi-market funds managing over BRL500m with at least 100 shareholders, highlights the rarity of Xavier’s earlier misstep. Funds closely tied to benchmarks like gold, the US dollar, or equities were excluded from the dataset.
