Investing
Hedge Fund Star Fuchs Fights to Recover From Soured China Bets
- BFAM misread policy signs, got burned on property firm bonds
- Fuchs’s troubles show even savviest investors got China wrong
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Benjamin Fuchs was an Asia hedge fund star, managing $5 billion at his company’s peak. Now, the former Lehman Brothers Holdings Inc. trader is one of the highest-profile casualties of China’s property crisis and battling to turn his firm around.
BFAM Partners (Hong Kong) Ltd.’s hedge fund lost almost 11% last year and a further 20% in the first seven months of 2022 as a series of bets on Chinese real estate developer bonds turned sour, after the firm mistakenly assumed the authorities would support the sector. While the losses aren’t existential or unique to BFAM, the company is bracing for possible redemptions and under pressure to retain staff.