US hedge fund manager North Sound Capital is set to end the year with little more than half of the $2.6bn (€2bn) assets it held in January, following a run of investment losses.

Thomas McAuley, founder of the long/short equity manager, said in a letter to investors: "We have taken steps to ensure the reduction in our capital is as smooth a transition as possible for all investors, and we believe we have been successful in this regard."