William von Mueffling of Cantillon wrote a letter to his LPs describing why Cantillon is closing its hedge fund business in order to focus on long only. Deal Breaker has the complete text of the letter here.
von Mueflling discloses nothing Earth shattering in the letter and really provides no rationale other than to say, "we have found ourselves covering a large number of shorts in the Cantillon World and Cantillon Europe hedge funds (the 'Funds'). This is likely to continue and therefore the Funds' portfolios in the future are not likely to exhibit the characteristics that we have always targeted for the Funds."
Cantillon has always had monthly liquidity and as such does not have some cliff of investors waiting poised to redeem upon some lock-up expiration. von Mueffling has always been a bit of an enigma and this furthers that view.
We are not really sure what this signifies. Perhaps his cessation of shorting calls an interim market top as capitulations by prominent investors often do. We shall see.