The tale of two hedge funds caught out in the natural gas market.
The first company, MotherRock, a fund set up by former Nymex president Robert ‘Bo’ Collins, went belly up in August after basically speculating that the natural gas market had reached its peak. This was followed by more spectacular losses at Amaranth Advisers. The Connecticut-based company told investors that its two main funds had lost close to about 50% of their values after the gas market peaked and started to come off rapidly. Amaranth then found itself holding a massive spread position, which moved rapidly against it.
But besides trading in the same...
