Comedy Gold!
"Nothing went right for the entire year," Einhorn said in the letter to investors. "In 2018, the losses were a mile wide and a yard deep. It's much easier to explain results when they are driven by large moves in a few names. It's much harder when the answer is a lot of everything. But today, it feels more like a combination of a few where we were wrong, a difficult environment for value investing, and a lot of adverse variance."
Ooh, "adverse variance" is rough; still, I don't know why he couldn't just factor for that and time the market accordingly...
Einhorn's collapse came in a dismal year when stocks and other risk assets took a hit from the ongoing trade battles and slowing global growth. However, Einhorn's hedge funds underperformed the market drastically — the S&P 500 ended 2018 down just 6 percent. His funds have been lackluster since 2015 when they lost more than 20 percent. They returned 7 percent in 2016 and 1.5 percent in 2017.
The underperformance in 2018 has inevitably led to "substantial redemptions," which forced Einhorn to reopen the funds to gain additional capital. Einhorn had not allowed new investments in four years.
"At this point, we no longer believe there is risk of our assets growing too quickly (other than through improved performance), so for those interested in investing, the answer will now be yes," Einhorn said.
Phew, glad to hear there's no risk of assets growing too fast! Don't let this rare investment opportunity pass you by folks.