Fortress Investment Group Loss
Fortress Investment Group Posts 13% 2Q Revenue Loss
Fortress Investment Group continues to boost assets under management despite stiff losses in the second quarter of 2011. A decline in segment revenue contributed to losses for the hedge fund and private equity fund management firm. CEO Daniel Mudd expressed his dissatisfaction with the second quarter loss, "Our earnings today were just off expectations, but further off what we expect from ourselves."
Fortress Investment Group LLC's (FIG) second-quarter loss widened on a double-digit decline in revenue, in what the private-equity and hedge-fund manager admitted were disappointing results.
Losses in the firm's liquid hedge funds, which invest in liquid assets like equities and commodities, wiped out "substantially all" of the accrued performance fees recorded in the first quarter, Fortress said.
Fortress Macro Fund Ltd. posted a 5.4% net decline in the second quarter, while Drawbridge Global Macro Fund Ltd. and Fortress Commodities Fund L.P. recorded losses of 6% and 6.4% respectively. The funds were still down between 4.1% and 5.7% this year through July. But its Asian fund held up with a 3% gain in the first seven months.
Alternative-investment managers like Fortress have posted poor hedge fund performance recently amid the volatile economy and weakness in commodities.
But Fortress said it's optimistic about the second half, saying its credit business continues to generate strong returns and its private equity business has continued valuation gain. Source
Related to: Hedge Fund Update
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