BlueGold hedge fund liquidates portfolio BlueGold Capital, one of the world's largest commodity hedge funds, is liquidating its portfolio and returning money to investors. In a letter sent out on Thursday, a copy of which was obtained by the Financial Times, London-based BlueGold, run by a former Vitol oil trading star Pierre Andurand and Dennis Crema, said it was conducting an "orderly closure." Since its launch in 2008, BlueGold had earned a reputation for delivering outsize returns - and occasional steep losses. In its first year of operation, the fund made a return of 209 per cent, following it with a 60 per cent return in 2009. Last year saw heavy losses across the commodity hedge fund sector, however, with many large managers, including BlueGold, wrongfooted by a heavy sell-off in oil markets in May. BlueGold saw its flagship hedge fund drop 34 per cent last year. So far, 2012 has also been a difficult year. Funds including BlueGold missed out on a major rally in oil, which has seen Brent crude rise 15 per cent in the first quarter. BlueGold's assets under management have dropped from a peak of $2.4bn a year ago to just $1bn currently. In its letter, the fund said it expected to return 98 per cent of investors" capital by May. "The final distributions in respect of the fund's remaining positions, adusted for any gains/loss on two existing equity positions, are anticipated to be paid by the end of the year, but we hope a lot earlier," the letter said. BlueGold declined to comment.