Hedge Fund Manager ‘Ignoring Trump’ Nets 39% Gain on Energy Bets

US President Donald Trump walks on the South Lawn of the White House in March. Photo by Aaron Schwartz /Photographer: Aaron Schwartz/Blo

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(Bloomberg) — A hedge fund manager focused on navigating the energy transition has generated a 39% return so far this year, after adopting a policy of ignoring US President Donald Trump’s signals on the Iran war.

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Anaconda Invest SA, a boutique hedge fund based in Switzerland, has consistently opted to disregard comments from the White House suggesting a ceasefire may be imminent, according to Renaud Saleur, its founder and chief executive. As a result, he’s stayed long oil stocks based on a bet that chronic undersupply will support demand for years to come. The hedge fund manager’s returns outpaced gains in the S&P Global Oil Index, which is up 31% this year.

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“In the short term, whenever Trump opens his mouth, you can see the whole party moving as if the flow [of oil] is going to resume overnight,” he said in an interview. In reality, oil prices have stayed high as an actual truce remains elusive, he said.

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Since the US and Israel attacked Iran on Feb. 28, Trump has often suggested an agreement to end the fighting may be around the corner, while adjusting the terms under which he’d be willing to accept a truce. Those mixed signals have repeatedly rocked markets, with March in particular proving a particularly tough month for many hedge funds and other investors.

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Saleur, who oversees $150 million at Anaconda, first made it known last month that he and his team were ignoring statements by the US president, arguing that to do otherwise would be unmanageable. Trump “changes opinion 10 times a day,” he said then. 

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Anaconda, which markets itself as a firm looking for the best way to invest in the value chain of the global energy transition, doesn’t see the war as an opportunity to add exposure to clean tech for now, Saleur said.

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“Oil today is much more profitable than renewables,” he said. Saleur, whose career spans stints at Fidelity Investments and George Soros’ Quantum fund, also said Shell Plc’s acquisition of Canada’s ARC Resources Ltd., announced on April 27, has encouraged him to invest.

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The firm has even been borrowing to add weight to its long positions in oil stocks, bringing its gross exposure to about 130%, according to Saleur. 

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Limited Room for a US-Iran Deal

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Anaconda is short tech stocks including International Business Machines Corp., as well as Nasdaq futures and firms that produce small nuclear reactors. Other short positions include the iShares Semiconductor ETF, while the fund is long Applied Materials, Inc. and Mersen, a maker of electrical specialties.

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The firm has also been buying semiconductor firms that are exposed to solar power, while shorting the main index for the chip sector, Saleur said.

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The fund’s biggest holdings include Schlumberger N.V., Baker Hughes Co. and Patterson-UTI Energy Inc. 

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“Drilling and services is probably an area which is going to be where people are going to focus more,” he said.

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—With assistance from Rachel Morison.

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