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Hedge fund manager Elliott Management Corp.'s fund gained 5.3% in the six months ended June 30, trade publication Absolute Return + Alpha reported late Thursday, citing an investor letter that is at the heart of a pending court case.
Elliott, founded by Paul Singer, rose just 0.4% in the second quarter, according to the letter. Its performance for the first half still outperformed broad market indexes, however. The S&P 500 declined by 6.6% during the period.
Elliott's 26-page investor letter is at the heart of a court case in which the hedge fund management company is seeking an emergency court order to force Absolute Return + Alpha to disclose the source who leaked the investor letter. It argues the disclosure of Elliott's positions and results would "give other market participants a competitive advantage to the detriment of Elliott, affecting Elliott's future results."
A New York State court hearing is scheduled for Sept. 9 and Absolute Return + Alpha said on its website on Aug. 25 that it will respond on Sept. 2.
Absolute Return + Alpha's article said Elliott profited in the second quarter from debt and convertible investments, but lost on distressed securities in Lehman Brothers Holdings Inc., General Growth Properties Inc. (GGP), and Washington Mutual Inc. It also suffered losses from event arbitrage trades on Pacific Century Premium Development Ltd. (0432.HK) and Epicor Software Corp. (EPIC), the publication said.
"Opportunities are actually low across the board," Absolute Return + Alpha cited the letter as saying. "We feel confident that when the environment changes, we will be able to deploy money in a cornucopia of attractive situations to fill up whatever capital we have available."
Elliott noted that its large positions in Argentinean debt, the Lehman Brothers bankruptcy and Delphi Holdings equity "continue to develop" but won't be resolved this year, the magazine said.
It added that Elliott will close a second, unspecific fundraising tranche on Oct. 1, in addition to the $16.9 billion it currently manages.
-By Amy Or, Dow Jones Newswires, +1 212 416 3142, firstname.lastname@example.org