Balestra shines during a tough January

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January was a tough month for hedge fund managers across the board, which makes Balestra Capital Partners’ return that much more impressive.

Last month, James Melcher’s $450 million global macro fund climbed 9.7%, following an astonishing gain of almost 200% earned last year by shorting subprime. By comparison, the Absolute Return Macro Index returned a paltry 0.08%, and the Composite Index experienced its third worst month since 1998.

The fund’s returns were lifted, in part, by continued profit-taking on short subprime positions. Melcher has now sold almost all of the fund’s credit default swaps on collateralized debt obligations. His negative