September’s bond market pain has stung Diego Megia’s $9 billion hedge fund Taula Capital.
The firm’s TSO fund — which runs a concentrated strategy that made a large bet on European interest rates going down — is down 12.8% through September since it launched six months ago, two people familiar with the matter told Business Insider. The strategy lost 12.2% in September alone, the two people said, meaning a vast majority of the fund’s losses came last month.
The firm raised $1.5 billion for the young fund in March, and backers can’t redeem their capital until next spring, the people added.
Taula declined to comment.
Global interest rates have jumped thanks to sticky inflation, the ongoing war in Iran, and artificial intelligence companies flooding the fixed-income market with new debt issuance.
For many asset managers who expected Kevin Warsh, the Federal Reserve chair, and other central bankers to cut rates or hold steady, last month’s rate hike has been stomach-churning.
That was particularly painful for TSO, whose concentrated strategy is positioned for European interest rates to fall. Instead, they moved sharply in the opposite direction. An index of global government bonds compiled by Bloomberg had its worst quarter since 2024, falling more than 2%, and French debt in particular had its worst quarter in decades.
As ExodusPoint macro portfolio manager Matt Dratch said on X, bonds are “having their ‘Situational Awareness’ moment,” referencing the implosion of Leopold Aschenbrenner’s AI-focused tech fund in August.
“Except perhaps everyone is Leopold this time,” Dratch added.
This is the second time this year macro investors have been stung by interest-rate moves. In the spring, when the US first bombed Iran, several managers, including Taula, suffered losses.
The London-based firm’s flagship strategy, which manages money for Megia’s former employer, Millennium Management, and is more diversified than the TSO fund, has also lost money this month. It’s down 4.3% through September 18, the people familiar with the firm said. That loss brought the flagship’s 2026 losses to nearly 10% through the same date.
It’s not yet clear how the firm’s macro peers have fared in September’s volatility. More diversified funds, including Millennium and fixed-income-heavy multistrategy manager ExodusPoint Capital Management, were flat and down 0.7% last month, respectively, Business Insider previously reported.
