Radical Transparency for Small Hedge Fund That Lost Big

Equinox Energy Fund, a small hedge fund that lost 85% of its clients’ money, told investors it was closing.


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It is common for hedge funds to close. It isn’t for them to do so with brutal honesty.

A little-known fund has done just that after it lost 85% of its clients’ money. In possibly the most transparent hedge-fund letter ever, Sean Fieler announced his fund’s end with aplomb.

“Our incredibly bad performance over the past four and a half years is a result of several factors,” Mr. Fieler wrote of the Equinox Energy Fund at Mason Hill Advisors LLC. Among them: “bad stock picking.”

“We wish to express our deep regret for having launched this fund in January of 2015,” he added. “We failed to anticipate all of the additional factors that cumulatively would lead to such a sizable loss of your capital.”

The fund shrank to $3 million in May from $46 million in 2015, documents show.

In parting, Mr. Fieler provided self-deprecating financial advice.

“Those investors who wish to maintain their exposure to Paramount and Crew,” two of the fund’s few remaining positions, “will be better served by realizing their tax loss on our fund and maintaining their exposure independently.”

Mr. Fieler didn’t respond to a request for comment. Daniel Schreck, a representative for the fund, declined to comment.

Write to Rachael Levy at rachael.levy@wsj.com

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