(Bloomberg) -- Brevan Howard Asset Management's flagship hedge fund lost 2.85% in March, erasing all of its gains from the start of the year, according to an investor letter seen by Bloomberg News.

The decline means the Brevan Howard Master Fund, which managed $10.8 billion as of February, ended the first quarter down about 2.4%. By comparison, the HFRX Macro/CTA Index has lost almost 1% in 2017. A spokesman for the investment firm run by billionaire Alan Howard declined to comment.

Macro hedge funds faced an investor backlash last year as clients pulled almost $10 billion following years of middling performance caused by central banks' easy money policies and record-low interest rates. Some are now starting to recover on the prospect of further policy normalization from the Federal Reserve, with Glen Point Capital — which manages money for clients including billionaire George Soros — said to have gained 6.5% in the first quarter.

Brevan's fund handed investors a return of 3% in 2016, its first annual gain in three years, even as it suffered about $7 billion in outflows.

Alan Howard plans to allocate as much as $500 million to a new fund his firm started last month, Reuters reported, citing a person familiar with the matter. The Brevan Howard AH Master Fund, overseen solely by the billionaire, will manage a combination of new, outside capital as well as money from Brevan Howard's flagship fund, people with knowledge of the matter said in February. A Brevan Howard spokesman declined to comment on the Reuters report.

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