News

Please note many of the below articles are written and published by parties unrelated to 36 South, therefore 36 South cannot guarantee the information contained in them is correct and takes no responsibility for the accuracy of them. Past performance is not necessarily indicative of future results.

 
  • Article in EQDerivatives
    January,
    2017

    “A person often meets his destiny on the road he took to avoid it.” —Jean de la Fontaine

    Several major events that transpired in 2016 are being discounted as insignificant. However, the question remains; were last year’s happenings the flapping of butterflies’ wings that will cause a hurricane elsewhere in the not too distant future? Facts are often overlooked by markets until they’re big and staring at it, and even then, some investors refuse to face reality until the data has smacked them right in the face.

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  • Article in Business Insider Finance
    August,
    2016

    Richard "Jerry" Haworth, 36 South CEO & CIO, was recently interviewed by Real Vision TV and discussed the current market environment and potential for market chaos.

    Business Insider reported the interview, noting that central banks have been trying to dampen volatility by pumping money into the economy, but that in the end this will backfire.

    The article placed emphasis on Jerry's comments about the dangers of the credit bubble and zero interest rates, and the possible consequences including chaos in the property, equity and bond markets.

     
  • Article in Bloomberg
    July,
    2016

    - 36 South ‘to take advantage of cheap implied volatility’
    - Investors expect policy makers to stem fallout from Brexit

    36 South Capital Advisors, a London-based volatility hedge fund, was surprised at how rapidly calm returned to markets after the initial Brexit shock spurred massive price swings such as the pound’s widest one-day range on record.

    While the fund made money in June, it wasn’t as much as the manager had anticipated as most markets recovered from the convulsions sparked by the British vote to leave the European Union, said Richard Haworth, chief investment officer of 36 South Capital. The 57-year-old manager declined to provide details of the fund’s performance or assets under management for compliance reasons.

    “This is the strangest environment I’ve seen in 30 years,” Haworth said by phone from London. “I had a sneaking suspicion that Brexit could have been the butterfly’s wing that created a hurricane down the line. But maybe, maybe not.”

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  • Article in EQDerivatives
    June,
    2016

    The recent global equities downturn following the U.K. electorate’s decision to vote Brexit in the European Union referendum last week is yet another example of the market following a very similar pattern to that of 2007/2008, according to Jerry Haworth, principal and CEO of 36 South Capital Advisors. He noted that the fund is sticking with its tried and tested monetizing strategy as complacency in long-dated volatility persists despite recent downward spot pressure.

    “The first thing I do notice in this market is that it is rhyming with 2007-2008. So, for example, last August China shot across the bow, followed by a rally into Christmas, then there was a weak January, then a rally right through May to the beginning of June and a pull down in the last few days. That’s quite concerning,” said Haworth. “Long-dated vol hasn’t gone up as much as short-dated vol and we have seen that trend time and time again in the past. What really happens to long-dated vol up until 30 is everyone plays the whack-a-mole and beats it down again. When there is a substantial move through 30 then you’ll see long-dated vol pick up again.”

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  • Article in EQDerivatives
    February,
    2016

    Formulating an outlook on volatility is akin to throwing darts at a target while blindfolded. Volatile events are inherently unpredictable; otherwise the expected risks would already be priced into asset values. Black swan events by definition are unforeseen. And even though impossible to predict, we can prepare. Grey swan events, conversely, are volatile events that can be anticipated with the use of superior analysis and macro-economic foresight.

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  • Video interview with Anthony Limbrick
    October,
    2015

    Anthony Limbrick, PM and Head of Quantitative Research at 36 South Capital Advisors LLP, was recently interviewed by Bloomberg TV India on mapping global cues, including the possibility of a Fed interest hike, emerging markets and the outlook for the rest of the year. To watch the video, please click here.

     
  • Article in Bloomberg
    September,
    2015

    - Fed's call this week won't calm new normal of turbulence
    - Valuations and emerging-market woes give clues, 36 South says

    Anthony Limbrick, whose hedge fund profited on bearish wagers during the August rout, says the recent turbulence in markets heralds a new era in increased volatility.

    One clear sign to Limbrick: U.S. stocks are expensive -- valuations for U.S. stocks when compared to earnings before interest, tax, depreciation and amortization hark back to the dot-com bubble era. Another: Emerging markets will continue to plague developed peers for years to come, mirroring the Asian financial crisis of the 1990s, he says. Limbrick’s firm, 36 South Capital Advisors, saw trouble brewing in developing economies back in 2013.

    And he says the Federal Reserve won’t do anything to calm equities after the twin concerns about China and a rate hike sent the VIX soaring 135 percent last month.

     
  • Video interview with Anthony Limbrick
    September,
    2015

    Please click here to view the video (external site)

     
  • Article in EQDerivatives
    September,
    2015

    The market is entering into a new vol regime with events in August surrounding China a mere dress rehearsal of things to come, according to portfolio managers at volatility funds. EQDerivatives spoke with senior officials from 36 South Capital Advisors, Artemis Capital Management and Dominicé & Co on current flow, the potential drivers of an expansion in volatilities and why institutional investors are increasingly allocating to volatility funds. EQDerivatives’ Rob McGlinchey reports.

     
  • Video interview with Richard 'Jerry' Haworth
    September,
    2015

    Please click here to view the video (external site)

     
  • Article in Bloomberg
    September,
    2015

    - Three of 36 South's strategies [rose] in August
    - 36 South sees EM, commodity currencies to remain vulnerable

    36 South Capital Advisors, a London-based volatility hedge fund, profited from China’s surprise devaluation when it triggered a global market rout that spurred losses in an index of its peers.

    Three of 36 South’s strategies, which bet on rising price swings, [gained] in August, based on initial estimates, Chief Investment Officer Jerry Haworth said in an interview. That would be the best monthly return in at least three years for its main fund, according to the manager. The HFRX Global Hedge Fund Index dropped 2.2 percent last month.

     
  • Article in Business Insider Finance
    August,
    2015

    Not everyone loses money when the markets fall.

    Take 36 South, for example. The London-based hedge fund's Black Swan strategy gained [significantly] in the chaos following the collapse of Lehman Brothers in 2008, and the firm is back making money today.

    Cofounder Jerry Haworth said the hedge fund has had its "best performance in a couple of years" betting big on spikes in volatility. And he didn't have to time the market to do it, having laid down traps for panicking markets already.

     
  • April,
    2015

    36 South is delighted to announce that one of its funds was selected as the winner of the ‘Discretionary Global Macro Fund of 2014’ category in the Investors Choices Awards 2015. For more information, please visit http://www.investorschoiceawards.com/emea---london.html.

     
  • Article in Bloomberg
    February,
    2015

    (Bloomberg) -- 36 South Capital Advisors is profiting from central-bank surprises that roiled markets over the past six months and spurred losses among hedge-funds rivals that also seek to gain from volatility.

    The manager’s [flagship strategy], which bets on rising price swings, [gained] in January, adding to its [considerable] return in the fourth quarter, Chief Investment Officer Jerry Haworth said. That reversed losses suffered as volatility evaporated from 2012 through the first half of last year. The HFRX global volatility index of similar hedge funds lost 1.7 percent in the three months ended Dec. 31.

    “With central banks taking a larger controlling role in the markets, especially in the interest-rate space, prediction is made more difficult,” Haworth said in an e-mail interview. “Whilst we probably cannot predict what event will cause volatility, the odds are in our favor.”

     
  • Article in Global Perspectives & Outlooks: A special report from EQDerivatives
    February,
    2015

    At the outset, any thought about future volatility is essentially meaningless. Volatility occurs when something unexpected appears on the horizon. If the event was known it would already be reflected in the asset value and the adjusted price would reflect no volatility. So what do we think about the PRICE of volatility in the future? On this notion we are on more certain ground. We can say with some confidence whether a price is cheap or expensive but we cannot predict whether a position will pay off.

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  • Article by Richard 'Jerry' Haworth in Hedge Fund Insight
    July,
    2014

    Everybody loves options, the generic kind. We love to be able to look back and un-decide a course of action without cost, i.e. to return assets after sale and get one’s money back. This is rare in practice though as there always seems to be a cost, seen or unseen, of having optionality in one’s back pocket.

    Wealth creation is no different: all of us would like to see the outsized returns which great risk brings but don’t want to “suffer the slings and arrows of outrageous fortune” [i] if their investment goes south. However some people do manage to have their cake and eat it too – they source or create this optionality which gives huge upside for little or no downside.

    It is this writer’s opinion however that the ability to create optionality is the single biggest wealth driver in the world. For example, thousands of top executives made their money predominantly via share options.

    Unfortunately most of us don’t get given options but have to buy them. What is the correct price and when do they represent value?

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  • May,
    2014

    Anthony Limbrick and Siva Naguleswaran of the 36 South Quantitative Research team have contributed a book chapter titled “Benchmarking Convexity: Towards a Holistic Approach” to the Risk Books publication, “Tail Risk Hedging: Theory and Practice”. The chapter addresses the lack of consensus on benchmarking convexity strategies, and provides the basics of a workable benchmarking framework, for those strategies that aim to harness both changes in implied volatility, and large directional moves.

     
  • 13th March 2014, London
    March,
    2014

    We are happy to announce the 5th Volatility and Tail-Risk educational event will be held on Thursday 13th March 2014 at the Royal Institution of Great Britain, Mayfair, London.

    Participants
    Sir Ranulph Fiennes, 'The World's Greatest Living Explorer' with be the guest speaker and confirmed participants include 36 South, Aberdeen Asset Management, Artemis Capital Management, BNP Paribas, CBOE, CheckRisk, Dominice & Co, Gladius Capital and Maple Leaf Capital.

     
  • December,
    2013

    36 South are currently booking meetings the week of December 1st for the Head of Quantitative Research to speak to investors about Benchmarking Volatility following his very well received presentation at the London Volatility and Tail Risk educational day in May. Click here for the pdf.

     
  • 23rd October 2012, Zurich
    October,
    2013

    Further to our previous successful events in both London and Switzerland we are pleased to announce the 4th Volatility and Tail-Risk Investing educational event will be held in Zurich on Wednesday 23rd October 2013. 

    Please seee www.volatilityinvesting.co.uk for further details.
     

     
  • Article in Bloomberg
    September,
    2013

    36 South Capital Advisors LLP, whose [left tail strategy] returned [significant gains] in 2008, has doubled bets this year on greater fluctuations in markets including currencies, commodities and equities.

    The manager overseeing $626 million has increased volatility investments to 90 percent of assets from 50 percent at the beginning of the year, Chief Executive Officer and Head of Investments Jerry Haworth of the London-based company said in a telephone interview yesterday.

    Central bank intervention, including asset purchases globally in the wake of the 2008 global financial crisis, have calmed investor jitters and suppressed price gyrations, making protection against bigger security price swings cheaper to obtain for funds such as 36 South.

     
  • A great success!
    May,
    2013

    On Thursday 16th May 2013 in London’s Mayfair, the 3rd Volatility and Tail-Risk Investing educational event brought together in one room, some of the world’s most experienced traders, analysts and investors in volatility and tail risk. 139 delegates from all over the globe heard insights regarding the benefits of volatility investment, the current opportunity set in terms of trading opportunities and new thinking regarding volatility portfolio management and benchmarking.

     
  • 36 South's Compliance Assistant wins 2 Chartered Institute for Securities and Investments awards
    March,
    2013

    Please click here

     
  • Video interview with Richard 'Jerry' Haworth
    November,
    2012

    Please click here to view the video (external site)

     
  • Article by Richard 'Jerry' Haworth in Pensions and Investments
    September,
    2012

    2008 is a terribly mis-aligned year. It is the “annus horribilis”, the year everything in finance went wrong. But instead of complaining about it we should be quietly celebrating it.

    There are many reasons to celebrate, mostly that it highlighted the dangers of everyone slavishly following modern portfolio theory with its deceptively flawed assumptions of constant volatility and correlation. By ignoring what we call “the evil twins” of correlation and volatility, the theory simply ignored grave potential dangers. 

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  • Article in Opalesque
    August,
    2012

    In our previous instalment of this series, we laid out a basic introduction to tail-risk that outlined what it is, its most common variations, and discussed the debate around whether these events can be adequately hedged. In this instalment we will take a deeper view, with two risk experts who say that investors should be employing tail-risk hedge strategies.

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  • Interview with Richard 'Jerry' Haworth in FINalternatives
    August,
    2012

    One of 36 South Capital Advisors' left tail funds, a single- client tail-risk vehicle named for the world's most famous black diamond, gained [substantially] in 2011 - and then closed. But despite announcing plans to launch a new "black swan" fund more than a year ago, the London-based firm, which moved to the U.K. from New Zealand in 2009, is still waiting for the right time to start.

     
  • Article in Pensions and Investments
    July,
    2012

    Macro/volatility specialist manager 36 South Capital Advisors LLP has an obsession with all things black, especially black swans and black diamonds.
    Founded in 2001 in Auckland, New Zealand, where native black swans (the avian type) are prevalent, the firm moved its headquarters to London in 2009 because “we were just too far away for institutional investors to do due diligence on us,” said Richard “Jerry” Haworth, principal and chief investment officer.

     
  • Article in Hedge Fund Alert
    July,
    2012

    36 South Capital, whose [left tail fund] famously gained [significantly] during the 2008 market crash, plans to roll out its next tail-risk offering within a couple of months.

     
  • January,
    2012

    One of 36 South's funds won New Fund of the Year - Relative Value, Macro & Futures at EuroHedge Awards 2011

    Click here to see the results

     
  • Article by Richard 'Jerry' Haworth in Investment & Pensions Europe
    July,
    2011

    Jerry Haworth argues that options-based volatility strategies have five ‘killer apps’ that make them better tail-risk hedges than managed futures – as long as you buy them at the right time
     

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  • Article in Bloomberg
    March,
    2011

    36 South Capital Advisors LLP, which closed its [left tail fund] after it gained in 2008, plans a new fund to replicate a strategy that seeks to profit from unforeseen high-impact events.
     

     
  • Article in HedgeWorld
    June,
    2010

    European hedge funds betting on the fallout from unforeseen events were among a small band of winners in a stormy May for investors, and they predict things could get stormier over the next three months.
     

     
  • Article by Richard 'Jerry' Haworth in Portfolio Advisor
    June,
    2010

    Inflation is the rise in the general level of prices of goods and services in an economy over a period of time. It is generally viewed as bad, especially for people who have already earned the majority of their lifetime earnings.

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  • June,
    2010

    One of 36 South's funds ranked second in the Option Strategies category for May 2010 by BarclayHedge.

     
  • Article by Richard 'Jerry' Haworth in Wealth Briefing
    February,
    2010

    A key issue for wealth managers for the near to medium term is whether the large injections of money into the economy by central banks will, as has sometimes happened in the past, presage an acceleration in inflation pressures. If so, wealth managers need to start thinking now about how to protect their clients’ assets from the ravages of rising prices, since even a supposedly low rate can take a large bite when compounded over a few years. Jerry Haworth, director of the firm 36 South Investment Managers, examines the inflation threat.
     

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  • Article by Richard 'Jerry' Haworth in Wealth Briefing
    December,
    2009

    Currency volatility has remained relatively muted given the extent of the global financial crisis. Our belief is that it is about to explode as currencies start to oscillate more and more wildly, like a suspension bridge starting to self-destruct under increasingly severe harmonic wave action.
     

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  • Media statement by AIMA
    September,
    2009

    The Australian arm of the international hedge fund industry body, Alternative Investment Management Association (AIMA), announced Australia’s top performing hedge funds and money managers at the 2009 Australian Hedge Fund Industry Awards.
     

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  • Article in Albourne Village
    September,
    2009

    Groundbreaking global macro hedge fund, 36 South has today announced a senior hire from Barclays Global Investors (BGI), alongside a move to new offices.
     

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  • Article by Richard 'Jerry' Haworth in FT Advisor
    September,
    2009

    As recent history has shown, the impact of unstable correlation between assets in a portfolio can be devastating
     

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  • Article In Seeking Alpha
    June,
    2009

    In recent months, an increasing number of investors have become convinced that the "perfect storm" for hyperinflation is brewing. To combat the worst recession in a generation, Washington (along with other world leaders) has ushered in stimulative monetary policy and major tax cuts, thereby expanding the trade deficit and establishing new records for government debt.
     

     
  • Article in Bloomberg
    June,
    2009

    36 South Investment Managers Ltd., whose [left tail fund] gained [significantly] in 2008, is raising money for a new hedge fund, betting that government efforts to pump money into economies could result in hyperinflation.
     

     
  • Article in Bloomberg
    March,
    2009

    36 South Investment Managers Ltd., a New Zealand-based hedge fund firm set up by derivatives traders, will close its [left tail fund] after it gained [significantly] in the last 12 months and start a fund that wagers on inflation.