Eric Mindich's $8.5 billion hedge fund, Eton Park Capital Management, is now ready to pick through the debt of beaten-up energy companies, an area it avoided last year as the price of oil tumbled.

"We have completely avoided exposure to the high yield debt of energy companies and to energy-impacted emerging markets, but as the price of these bonds trade down, we are spending increasing amounts of time researching opportunities in this space," Eton Park wrote in a letter to clients dated Jan. 16 and seen by Reuters.

Sidestepping falling oil prices that hit six year lows is just one of several bullets the prominent manager said he dodged last year. Eton Park gained 6.4 percent in 2014 after rising 22 percent in 2013 and 13 percent in 2012. For the last three years, the fund returned an average 13.3 percent annually.

Eton Park dropped mortgage companies Fannie Mae and Freddie Mac with a big profit before a U.S. judge threw out a lawsuit filed by shareholders to prevent the government from seizing most of the companies' profits.

It also got out of pharmaceutical company Shire Plc amid signs the government would crack down on mergers seeking tax advantages. And it sold Shire short before its planned merger with AbbVie Inc was called off, netting a profit.

For most hedge funds, 2014 was another year of lackluster returns, with the average fund gaining only about 4 percent and some managers nursing losses in the wake of heavy declines in Fannie and Freddie, as well as Shire stock prices.

"In 2014, we managed to avoid most of the major pitfalls, while at the same time build large exposures at the right times to the key winners," the letter said.

One of those winners was pharmaceutical company Allergan Inc , which fought hard against being bought by Valeant Pharmaceuticals International Ltd, and later signed a deal with Actavis Plc. Short bets against offshore drillers and Europe's Euro currency as the U.S. dollar was rising also helped.

On the other hand, bets on Marathon Petroleum Corp and Tullow Oil Plc (TUWLF) ranked as some of the fund's biggest losers last year.

Mindich has been a huge success story in the $2.5 trillion hedge fund industry after drumming up so much demand when he set up his fund in 2004 that he raised $3.5 billion at the start. (Reporting by Svea Herbst-Bayliss. Editing by Andre Grenon)