May 12, 2016 / 9:21 AM / 3 years ago

Brevan Howard winds down Argentina fund after returning net 18 percent

LONDON (Reuters) - Brevan Howard Asset Management, one of Europe’s largest hedge funds, said it is winding down a fund that bet on Argentine assets after the country agreed a deal with creditors.

Argentina returned to capital markets last month after ending a 14-year dispute with its creditors over sovereign bond payouts.

The $500 million limited life Argentina Master Fund generated net returns of 18 percent since opening to outside investors in January 2015. [here]

Argentina’s return to global credit markets followed the election in November of President Mauricio Macri. He spent the first months of his term resolving a mountain of litigation that followed a $100 billion default in 2002, including a deal with “hold-out” creditors who had refused to accept the terms of earlier debt restructurings.

“We launched the fund as a limited life SPV (special purpose vehicle) to position in front of the Argentine elections in order to take advantage of anticipated political change and a subsequent resolution of the bond hold-out dispute,” a Brevan Howard spokesman said.

In contrast to the Argentine fund, Brevan’s main macro fund has struggled, with investors pulling out billions, reducing assets to $17.6 billion at the end of March from $27 billion two years ago.

Reporting by Maiya Keidan; editing by Adrian Croft

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