Drury Capital CTA
Drury Capital CTA Fund | Hedge Fund Notes
The following piece on Drury Capital CTA Fund is being published as part of our Hedge Fund Tracker Tool, our daily effort to track hedge funds in the industry.
Resource #1: (11.10.08) Bernard V. Drury is a rarity on Wall Street: a hedge fund manager who is making money rather than losing it.
While most hedge funds are sinking into red this year and unsettling the markets in the process, a handful of them are posting spectacular gains. Mr. Drury’s fund, for instance, is up 60 percent since Jan. 1.
How did he do it? Mr. Drury, a former grain trader, is not giving away his secrets. He relies on proprietary computer models to chart tides in the markets and to ride the prevailing currents.
But however smart or lucky the moneymakers have been, a few bad trades can end any hot streak. Despite Wall Street’s reputation as a place of big money and bigger egos, many of the winners are reluctant to boast, particularly given the gaping losses threatening some rivals.
“There’s going to be, naturally, a lot of forms of disillusionment with hedge funds,” said Mr. Drury, who opened his fund, Drury Capital, in 1992. Source
Resource #1: (11.9.08) What some traders call "artificial intelligence" is helping some commodity hedge funds triumph in treacherous markets when human brains alone are proving to be not enough. With industry data showing the average hedge fund down 20 percent or more this year, some commodity trading advisers, or CTAs, are up at least 50 percent. These investors say credit should also go to their computerized trading systems.
"It's like a computer playing chess against an excellent individual chess player," said Bernard Drury, president and chief executive at Drury Capital, a New Jersey CTA that relies entirely on systemic trading, or trading without discretion. "The computer can be counted on not to make human errors, not to make a miscalculation, not to be tired and not to have a bad day."
Drury's flagship fund is up 57 percent on the year managing about $155 million in commodity and financial investments. Using computerized trading models to make bets on markets is not new. Hedge funds and other major market investors reportedly made profits last year using electronic algorithmic trading models to not only follow trends but also speculate on them as both stocks and commodities rallied.
But as the credit crisis lowered U.S. stock values by a third and prices of some commodities like oil by half, hedge funds with decidedly long, or bullish, positions suffered when they could not turn short, or bearish, as deftly as CTAs had. Source