One of last year's highest-performing hedge funds, the 788 China Fund, has recorded a loss of 57% for the first three months of this year after what its manager described as "the most horrible quarter I have experienced in 24 years of managing money".

But the fund, which is managed by Swiss asset manager Heritage Fund Management, for Cayman-registered manager 788 Asset Management, has recovered 40% of its value since the start of April, according to Jacques Mechelany, who runs it: "The month of March was terrible, there was a silly sell off. We made the mistake of entering the market without imagining it would sell to such an irrational level. But we stuck to our positions and have ridden out the volatility."