Everest Macro Hedge Fund Blows Up After Nearly $1 BIllion In Swiss Franc Losses

Zerohedge ^ | 1-17-2015 | Durden

[tcrlaf]

Yesterday, when we got the first news of huge P&L losses at various publicly-traded banks not to mention the collapse of several retail brokers culminating with the bailout of FXCM by Jefferies, we reminded that seconds after the SNB shocker, we tweeted what was quite obvious to anyone who realized that speculators were most short the CHF since the summer of 2013.

We also added that "We have yet to find out just which hedge funds were blown up yesterday", for the simple reason that unlike public banks who have an obligation to reveal news, especially bad, to their shareholders, hedge funds PMs hope to avoid the LP firing squad until the last second. Alas, there is only so long that the day of reckoning can be delayed.

One such fund is the Everest Capital Global macro fund, which went from just shy of a billion to zero in milliseconds as a result of a near wipe out due to a massive CHF-short position. Bloomberg reports:

Marko Dimitrijevic, the hedge fund manager who survived at least five emerging market debt crises, is closing his largest hedge fund after losing virtually all its money this week when the Swiss National Bank unexpectedly let the franc trade freely against the euro, according to a person familiar with the firm.

Everest Capital’s Global Fund had about $830 million in assets as of the end of December, according to a client report.

[wildbill]

A FX trading analyst that I greatly admire had talked about the possible removal of the SNB line in the sand if pressure to hold it by buying Euros became too great.

Yet he maintained a long Euro/Chf position and admitted that he lost 6% of his assets when the dam broke. Analysts always tell you not to have more than 2% of assets in any one trade, but perhaps he got caught by “slippage” when the currency went past most stop losses.

I had also had a long position for a while, but the market stalled out and didn’t move for weeks so I got out of all CHF positions. Lucky hunch.