Amaranth Advisors LLC, the hedge fund group whose $9 billion in assets fell by more than 65% this month, on Friday told investors on a conference call that it has no plans to liquidate. “We have every intention of continuing in business,” Nicholas Maounis, founder of the hedge fund, told investors, according to Reuters. “We are fully prepared to do whatever it takes to restore your confidence.” Greenwich, Connecticut-based Amaranth blamed its massive losses this month on “unusual market behavior” in the natural gas market that “virtually eliminated the firm’s liquidity,” and threatened its survival. The firm, which bills itself as a multi-strategy firm, has been criticized for what investors said was over-reliance on energy (on September 14 the fund experienced roughly $560 million in trading losses on their natural gas positions).
In a related development, the San Diego County Employees Retirement Association announced last week that the county pension system’s estimated losses from the crash of a hedge fund Amaranth have climbed to $87 million, nearly twice the figure given just two days previously. The latest estimate – which could still change – was based on new information from Amaranth Advisors, according to the San Diego Union Tribune, citing comments by Brian White, CEO of the San Diego County Employees Retirement Association. Some 20% of the $7.7 billion county pension system’s investments are with hedge funds.