Hedge fund manager Dan Loeb warned investors against expecting unrealistic returns if they’re counting on investing in energy companies on the cheap.

“All of the funds that have been set up to capitalize on distress in the oil patch might be disappointed, kind of like European funds that were set up to capitalize on European distressed-debt situations,” Loeb said Friday in a conference call discussing results at Third Point Reinsurance Ltd., the Bermuda-based reinsurer that he co-founded.

Investors including Leon Black’s Apollo Global Management LLC have sought to temper investor expectations, even as they raise funds to prepare for further disruption in the energy market. Oil prices are poised to climb in February after seven straight monthly declines.

“Our sense right now though is if you look at some of the big oil stocks they really have not moved down commensurate with the price of oil,” Loeb said. “Equities have already moved up in anticipation of the recovery. We’re pretty much on the sidelines in energy.”