RAB Energy duo dig deep to extract value, bounce back from 2008 blow
January 26, 2011
An overhaul of their hedging and investment strategy has enabled Gavin Wilson and Mark Redway to bounce back from a big drawdown in 2008 – focusing the fund more explicitly on drilling ‘events’ in the oil and gas sector and reducing its exposure to big market movements and the oil price
Of all the long/short equity funds that suffered most in the downturn of 2008, very few have bounced back quite as swiftly and spectacularly as RAB Energy – the event-focused oil and gas sector strategy run by long-standing industry specialists Gavin Wilson and Mark Redway.
Gavin Wilson and Mark Redway
Having produced excellent returns from its launch in mid-2004 to mid-2007, the fund came a cropper in 2008 as a result of an array of adverse factors – including a steep fall in the oil price, collapsing financial markets in the latter part of the year, a flood of investor redemptions and severe liquidity issues that were sharply exacerbated by the portfolio’s illiquid investments.
The result was a situation that Wilson and Redway describe as “horrible” – involving a painful loss of some 60% for investors in 2008 and a severe depletion in the size of what had until then...
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