September 20, 2006
Amaranth Loss Is Tip Of Melting Iceberg: Analysts
The industry seems to have taken the Amaranth loss quite badly. Analysts are now predicting even more financial carnage after Amaranth told its investors that it is facing severe losses from enormous bets in the energy futures market, just a month after another fund went bust over its wagers in the same market. Theglobeandmail.com reports:
Amaranth Advisors LLC, a hedge fund with $9.5-billion (U.S.) in assets, warned its investors that the value of its two main funds fell nearly 50 per cent this month because of falling natural gas prices. Its warning followed last month's collapse of MotherRock LP, a $400-million (U.S.) fund that blew up after gas prices fell 68 per cent from their peak last December.
Read more: Analysts fear hedge fund losses in energy market tip of iceberg
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