Bloomberg News

Salida Capital Doesn’t Anticipate ‘Material’ Redemptions

October 05, 2011

(Updates with conference call comments from sixth paragraph.)

Oct. 5 (Bloomberg) -- Salida Capital LP doesn’t anticipate any “material” redemptions after plunging energy prices eroded returns for the Toronto-based hedge fund, Chief Executive Officer Courtenay Wolfe said.

“We’ve talked to pretty much every material client, people are holding the course,” Wolfe said today in a telephone interview. “We don’t anticipate or have not heard of any material redemptions.”

Salida, whose members paid $1.68 million in 2009 to have lunch in New York with billionaire investor Warren Buffett, told clients this week that investment calls in mid-August backing oil and gold “have been costly, as the market has moved against us.”

Wolfe said Salida funds have a 90-day notice period, and her company has only had C$37,000 ($35,000) in redemptions for January 2012. The company manages about C$500 million in assets, Wolfe said. She said in May the fund ran about $900 million.

Wolfe reiterated that speculation Salida is on the verge of collapse is “unfounded” and that no one has been fired as a result of recent market volatility. The company hasn’t taken any of its own money out of the accounts and doesn’t plan to, Wolfe said.

The Salida Strategic Growth Fund posted a 37 percent decline last month, contributing to a 49 percent drop for the year, the company said today on a conference call with clients. Salida will be publishing monthly performance data “shortly,” Wolfe said.

“You’ll see that there are no anomalies there; there’s no red herrings in there,” she said.

Salida continues to be its own “anchor” investor and the funds continue to favor oil and energy investments. Some clients have considered increasing their holdings in Salida funds, the company said today on its conference call.

The money manager expects that Federal Reserve Chairman Ben S. Bernanke will announce additional stimulative measures to the economy by the end of the year. The U.S. will go into a “severe recession” without implementing so-called QE3, the company said on the conference call.

--Editors: David Scanlan, Steven Frank

To contact the reporter on this story: Sean B. Pasternak in Toronto at spasternak@bloomberg.net

To contact the editor responsible for this story: David Scanlan at dscanlan@bloomberg.net


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