Jason Mudrick, the hedge fund manager who owns a large stake in one of the biggest players in the U.S. vaping market, wrote down the value of his position by 20%, according to an investor. That would imply a $1.7 billion valuation for the e-cigarette company NJOY Holdings Inc., down from more than $2 billion last year. Even with the writedown to one of its largest positions, Mudrick’s Distressed Opportunity fund returned 22% last year, the person said, asking not to be identified because the information isn’t public. The fund’s winners included a short wager on the credit of...