San Diego Business Journal – Now facing a loss of $105 million invested in a failed hedge fund, San Diego County’s pension board is mulling whether to continue similar investing strategies, as wellas litigation against Connecticut-based Amaranth Advisors LLC.
Brian White, the pension fund’s chief executive, said Amaranth officials told him the value of the pension fund’s holdings had decreased to $70 million as of Oct. 6. The county pension fund invested $175 million in the fund last year, or about 2 percent of its total $7.7 billion in assets.
Amaranth told White that it is not redeeming any investments in the fund until it completes a liquidation process that began last month after it failed to sell itself to Citigroup.
“They’ve suspended redemption requests and indicated they won’t resume until they fully liquidate,†White said. “They gave no date about how long that would take.â€Â
Amaranth’s meltdown last month was caused by spectacular losses sustained from investments in futures energy-related contracts that went in the opposite direction. As a result, the losses plummeted the value of the fund from $9 billion to $3 billion as of Oct. 1.
The county pension board held a closed session Oct. 7 to discuss possible litigation. White said it involved Amaranth. He said no decision was made during the session.
