Maverick Capital Partner to Leave (WSJ) Maverick Capital Ltd.'s Steve Galbraith, who left a top investment-strategist post at Morgan Stanley MS +3.64% for the hedge fund eight years ago, plans to leave the firm as soon as the end of this month, according to people familiar with the matter. ...Lee Ainslie III, Maverick's chief and founder, confirmed Mr. Galbraith's planned departure when reached by The Wall Street Journal on Thursday afternoon. "Steve has been a great partner and friend and has made significant contributions to our success over the years," Mr. Ainslie said. "All of us at Maverick are excited for Steve and wish him the best in his new endeavor."
GLG Announces New Appointment To Fixed-Income Hedge Fund Offering (HereIsTheCity) GLG has announced that Sudi Mariappa will be joining to manage its absolute return fixed-income offering. Mariappa worked at Pimco from 2000 to 2010 and was promoted to Managing Director in 2003. He ran the Global Portfolio Team until 2008 and managed a team of investment managers around the globe.
Permal Fixed Income Special Opportunities, managed by NWI Management (HedgeFundsReview) Hari Hariharan tends to see the world through the eyes of emerging markets – a good thing for the chairman and CEO of NWI Management, the $2.4 billion hedge fund manager. With a long and consistent track record of investing in emerging markets, fixed income and global macro themes, Hariharan now manages the Permal Fixed Income Special Opportunities (PFISO), which follows a strategy focused on global emerging markets fixed income and local currencies. Since July 31, 2010 all of the now $484 million assets under management of the fund are invested in a Permal-sponsored special purpose fund.
China Hedge Fund Association holds inaugural event (IPE) Executives from the China hedge fund industry gathered last Saturday for the Hedge Fund Association China Chapter's first event – a symposium on the role of foreign HFs in China held at the Cheung Kong Graduate School of Business (CKGSB) in Beijing. The event was hosted by Adam Steinberg, head of the HFA China Chapter, and included a panel discussion with Professor Li Haitao, Visiting Professor of Finance at CKGSB, Oliver Barron, Head of the Beijing Office of NSBO, an financial market information provider, and IPA's Iain Mills.
Hedge fund investors take fundamentalist view (AsianInvestor) Credit, fixed income and relative-value strategies are seen as among the best bets in the coming year by funds of hedge funds in Asia, as global uncertainty continues to cast a pall on markets. “The world is still in a very fragile state,” says Max Gottschalk, head of Asia at Gottex Fund Management, during a panel discussion at the Hedge Funds World Asia conference in Hong Kong this week.
Majority of Hedge Funds Successfully Complete First Form PF Filing With Advise Technologies (BusinessReviewUSA) Advise Technologies LLC, a software solutions provider for global regulatory compliance, today announced that the majority of hedge funds, representing over $900 billion in combined private fund regulatory assets under management (RAUM), successfully filed Form PF for the first time using its Consensus RMS solution. August 29, 2012, was the first deadline for registered investment advisers of over $5 billion RAUM to file Form PF for their private funds with the Securities and Exchange Commission.
U.S. Appeals Court Revives Securities Cases (Observer) A federal appeals court revived a pair of securities cases in decisions handed down today, reinstating a lawsuit charging Goldman Sachs with misleading mortgage investors, as well as a 10-year-old insider trading case brought against a hedge fund manager. In the former case, the Second U.S. Circuit Court of Appeals said that NECA-IBEW Health & Welfare Fund, which serves electrical workers, could lead a class action lawsuit on behalf of investors in 17 mortgage-backed securities underwritten by Goldman. According to Bloomberg, NECA only invested in two of the offerings, and in 2010, a federal judge ruled that fund lacked standing to represent investors in the other securities. Reuters reports that today’s ruling reinstates claims relating to seven of the securities.
Ex-Citadel’s Russell Said to Close Hedge Fund Bell Point (BusinessWeek) Bell Point Capital Management LP, the multistrategy credit hedge fund founded by Joseph Russell, the former head of U.S. fundamental credit at Citadel LLC, is winding down by the end of the year, according to two people familiar with the matter. Bell Point, whose main fund reached a peak of more than $500 million in assets earlier this year, plans to give money back to investors and has already returned an undisclosed amount, said the people, who asked not to be identified because the information is private. Russell, 49, plans to retire, the people said.
Appeals Court Revives Insider Trading Case Against Obus (NYTimes) One of the country’s longest-running insider trading lawsuits has just gotten longer. A federal appeals court on Thursday revived a decade-old insider-trading case brought by the Securities and Exchange Commission against Nelson J. Obus, a New York hedge fund manager. In 2006, after a four-year investigation, the S.E.C. charged Mr. Obus, president of Wynnefield Capital, with illegal trading in the stock of SunSource after receiving confidential company information. The agency also filed a civil lawsuit against Peter F. Black, an analyst at Wynnefield, and Thomas B. Strickland, a former employee at General Electric who was accused of being the source of a secret tip.
Reinsurance Hedge Funds Flourish Amid Flexible Regulations (ValueWalk) New York Times published an article on September 4th that observes how risky trades are flourishing in hedge funds, amid flexible regulations. In places like Bermuda and the Cayman Islands, hedge funds can generate millions in permanent capital through the reinsurance business. As the reinsurer will itself invest in the hedge fund, the investment becomes permanent. The report explains how hedge funds venturing into the reinsurance market could lead to a “chain reaction”, where hedge funds will rush to sell risky assets, in order to fulfill payment on claims-loss liquidity needs. As insurers and reinsurers invest heavily in the stock market and any economic catastrophe will magnify their losses, the detrimental effects will be felt on the stock market as well. Miller Tabak & Co.’s Thomas Mitchell is out with a report today rebutting the Times Piece. Mitchell thinks that the author did not get the full picture in his article.
Billionaire Leon Cooperman Predicts Romney Win Better For Stock Market Than Obama Victory (IBTimes) Leon Cooperman, the billionaire founder of Omega Advisors, and Jack Bogle, the retired CEO and founder of Vanguard, are having it out over what the 2012 presidential election's impacts will be on the stock market. Cooperman, a hedge fund magnate who founded the $6.5 billion Omega, predicted Thursday on CNBC that a Mitt Romney victory in November would have a marked positive impact on the S&P 500, but that if President Barack Obama is re-elected, the S&P 500 would suffer, Business Insider reports.
New Bloomberg List Features Cooperman, Other HF Stars (HedgeFund) It is stating the obvious that a $2 trillion business carries a lot of clout in the world. The point is further amplified by Bloomberg Markets magazine’s new 50 Most Influential list. ...AQR Capital’s Clifford Asness came in at No. 11, followed by Tiger Global Management’s Chase Coleman at No. 13, Leon Cooperman of Omega Advisors (No. 14), Ray Dalio of Bridgewater Associates (No. 15) and Michael Platt (No. 20).
This Hedge Fund Giant is Banking on Kors (KORS) Rapid Rise (StreetInsider) Making a pretty penny from Michael Kors Holdings Ltd(NYSE:KORS) favorable move today is Steven Mandel's Lone Pine Capital. Mandel has been adding to his position since Kors IPO last December. His Lone Pine Capital hedge fund reported holding 3,651,155 shares at the end of 2011. That moved up to 5,259,900 at the end of the first-quarter, jumping 3.9 million shares to 9,202,011 at the end of June.
Hedge Funds Lag Stocks In August (Finalternatives) Hedge funds continue to badly trail the broader markets, failing once again in August to participate in a stock-market rally. The average hedge fund rose 0.56% last month, the Dow Jones Credit Suisse Core Index shows. But the Standard & Poor's 500 Index rose almost 2% on the month and is up almost 12% on the year. By contrast, the Dow Jones benchmark is up just 2.02% this year, a gain recorded almost entirely in the last two months.
Another So-So Month for Brevan Howard (InstitutionalInvestor) Brevan Howard continues to struggle this year. The London-based hedge fund giant made a little less than 1 percent in August, the second straight month it has eked out a small gain. But it is still down for the year by 0.45 percent. The results were reported by BH Macro, a listed feeder fund that invests its assets in Alan Howard’s Brevan Howard Master Fund. BH Macro’s assets are about $2 billion, compared with roughly $26 billion in the Master Fund. BH Macro’s returns closely track the Master Fund.
'Can do better': allocators mark managers on fund terms (InvestmentEurope) Nearly half of allocators to hedge funds said they have seen investment terms shift in their favour over the past 12 months, and three quarters now believing their own interests are properly aligned with those of managers. Only 11% of more than 80 fund buyers that Preqin polled worldwide experienced terms moving in favour of the managers. But the allocators have effectively said 'must do better' in regards to all the main terms broached in hedge fund negotiations.
Navistar gains as truck maker weighs options (MarketWatch) Shares of truck maker Navistar International Corp(NYSE:NAV), which has faced pressure from activist Carl Icahn and other top shareholders, surged 7% to $21.76 Thursday morning. Navistar reported an $84 million profit for the quarter ended July 31, which exceeded Wall Street's expectations. Navistar also said it was reviewing "all of its non-core businesses" to help shore up profitability. The company further said it was cutting costs through employee buyouts and workforce reductions.
eVestment reports large funds enjoyed good returns while credit funds continued with an excellent year (Opalesque) eVestment|HFN announced the release of their August hedge fund industry report. The report shows that hedge funds posted their third consecutive month of positive performance in August returning an average of 0.7% and pushed aggregate performance to positive 4.1% for the year. Large funds, those with greater than $1 billion in AUM, posted an average return of 1.9%, their best month since January. Updated asset flow estimates point to elevated investor outflows in July, $11.8 billion, as total hedge fund assets touched $2.52 trillion.
Don’t Expect a Black Wednesday in Denmark (InvestmentU) George Soros made more than $1 billion in 1992 on the basic premise that something was not right. Specifically, he saw that Great Britain’s currency was about to fall apart. Black Wednesday refers to the events of September 16, 1992, when the British government had no choice but to withdraw the pound from the European Exchange Rate Mechanism (ERM) when they couldn’t keep the pound above its agreed lower limit. Soros made his $1 billion profit by shorting the British currency.
DNC week puts big smile on the face of Jim Rogers (BizJournals) Jim Rogers, chief executive of Duke Energy Corp. and co-chair of the Charlotte in 2012 Host Committee, was clearly relieved as Tuesday slid toward evening and the Democratic National Convention was ready to start. “We got everything going,” he said, smiling broadly as the momentum of the convention quickened.
Hedge Fund Ads: Coming Soon to a Newspaper Near You (USNews) Hedge funds are one step closer to officially being permitted to advertise to the general public. The burning question, though, is whether that's cause for celebration or trepidation. The Securities and Exchange Commission has recently put forth proposed rules that, if approved, would govern hedge fund advertising. The rules are a direct response to the JOBS Act, which contained a provision requiring that hedge funds, along with various other types of private offerings, be allowed to market their products to all types of investors.
Copper Trade Most Bullish Since October on Stimulus: Commodities (Bloomberg) Copper traders are the most bullish in almost 11 months on mounting speculation central banks will do more to bolster growth, strengthening demand for metals. Twenty-one analysts surveyed by Bloomberg said they expect prices to gain next week and five were bearish. A further four were neutral, making the proportion of bulls the highest since Oct. 14. Hedge funds are betting on higher prices for the first time since May and stockpiles in warehouses monitored by the London Metal Exchange, the largest metals bourse, dropped to the lowest level in almost four years.
Blackstone’s Blitzer Is Said to Manage $1.5 Billion Fund (Bloomberg) The Blackstone Group L.P.(NYSE:BX) has raised about $1.5 billion from clients for a fund that will be managed by David Blitzer, a senior managing director who started the New York-based firm’s European private-equity business in 2002. The fund focuses on assets that are too illiquid for most hedge funds to buy and more easily traded than the companies and loans purchased by private-equity firms, said two people familiar with the matter. Blackstone began raising money for the Tactical Opportunities fund last year to take advantage of investments sourced from its private-equity, hedge fund and real estate businesses, said the people, who asked not to be identified because the information is private.
Senate committee launches probe of JPM's "Whale" losses (Reuters) A U.S. Senate committee has launched a probe into JPMorgan Chase's "London Whale" trading losses, according to a source familiar with the investigation. ...JPMorgan's losses stemmed from bets by London-based CIO trader Bruno Iksil on an index for credit default swaps. His outsized positions earned him the nickname "London Whale" from the hedge fund traders taking the other sides of his positions.
Maple Leaf on how to profit from volatility (Opalesque) Michael Wexler, veteran volatility trader and co-founder of Maple Leaf Capital, explained in a recent Opalesque TV interview how investors can profit from a high volatility environment. Maple Leaf Capital is an investment management company founded in 2002, with principal offices in London and Hong Kong, and which manages client assets in the areas of volatility trading, illiquid loans, fixed income momentum arbitrage, macro risk, and crash overlay strategies. According to Wexler, it is possible to profit from volatility because the dislocation in the pricing of options between fair value and actual trading is greater at higher volatility levels.
SEC Reschedules Date of Market Technology Roundtable (SEC) The Securities and Exchange Commission today announced that its market technology roundtable, which was scheduled for Sept. 14, will be held on Oct. 2. The change was made to accommodate scheduling conflicts and to better respond to strong interest from individuals and groups wishing to participate in the roundtable discussion. The roundtable at the SEC’s Washington, D.C. headquarters is open to the public and will be webcast. As previously announced, the event will begin with a discussion on preventing errors, focusing on current best practices and practical constraints for creating, deploying, and operating mission-critical systems, including those used to automatically generate and route orders, match trades, confirm transactions, and disseminate data.
SEC Charges Oregon-Based Investment Adviser for Failing to Disclose Revenue Sharing Payments (SEC) The Securities and Exchange Commission today instituted a settled administrative proceeding against two Portland, Oregon-based investment advisory firms and their owner regarding the failure to disclose a revenue-sharing agreement and other potential conflicts of interest to clients. The SEC’s investigation found violations in three areas of the advisory business run by Christopher Keil Hicks, who owns Focus Point Solutions and The H Group. Most notably, Focus Point did not disclose to customers that it was receiving revenue-sharing payments from a brokerage firm that managed a particular category of mutual funds being recommended to Focus Point clients.
SEC Charges Solar Manufacturer With Concealing Agreement to Transfer Ownership Stake in Its Chinese Subsidiary (SEC) The Securities and Exchange Commission today charged a solar panel manufacturer headquartered in South San Francisco and three of its former executives with defrauding investors by concealing the transfer of nearly half of the ownership stake in its Chinese subsidiary to three individuals in China who manage the subsidiary. The SEC alleges that Worldwide Energy and Manufacturing USA Inc. (WEMU) raised nearly $9 million from U.S. investors in early 2010 in order to expand its solar subsidiary based in Rugao City, China. The Chinese subsidiary represented the bulk of WEMU’s operations and generated 77 percent of the company’s revenue the previous year.
Al Gore’s Generation Becomes Largest Hedge Fund Holder Of Jones Lang LaSalle Stock (HedgeCo) Hedge fund Generation Investment Management, which was founded in 2004 by former Vice-President Al Gore and David Blood, has increased its stake in $3.2 billion market cap manager of real estate and investments, Jones Lang LaSalle Incorporated, to 2.3 million shares. Generation now owns 5.3% of the company’s shares outstanding, making them the largest hedge fund holder of the stock. the hedge fund has filed a 13G with the SEC to disclose its investment.
BerchWood Hires Cantor Fitzgerald Alumnus Hastings (Finalternatives) BerchWood Partners, a capital raising specialist, has hired Chris Hastings to oversee new client relationships, fundraising mandates and fund distribution. Hastings, who will join BerchWood’s New York office, comes from Cantor Fitzgerald where he was head of the private capital group, focusing on originating and distributing private equity, venture capital, distressed credit and mezzanine funds. Before that, he was in the private placement group at Credit Suisse, raising capital from large institutional investors in the energy, financial, healthcare, and technology sectors. Prior to that, Hastings spent nine years at Bear Stearns.
Big Name Hedge Funds Struggle While Markets Surge (InstitutionalInvestor) Several of the biggest names in the hedge fund world are losing money this year despite the double-digit returns being generated by most of the widely followed indexes. Of course, there is John Paulson, who has at least two funds that are down by double digits through July. As we have reported earlier, many of the funds of Sloane Robinson continue to struggle this year. For example, one of the classes of the Sloane Robinson Global Fund is down more than 13 percent through August 22. Another offering was off by more than 4 percent.
Final nominations announced for InvestHedge Awards for Performance Excellence (HedgeFundIntelligence) With less than a month to go until the gala dinner, 20 new funds have been added to the FINAL nomination list. ome of those added – like FRM Sigma, Man Managed Futures Strategies, HSBC Trading AdvantEdge, SAPIC Global Macro, Spruce Real Asset and the Zephyr Commodity Fund – as well as Mosaic, Key Hedge Fund, and IAM Multi-Strategy Composite are appearing for the first time in the final round of nominations – reflecting the turbulent times the commodity trading advisor and managed futures markets have been having. With more than $250 billion under management, 61 funds of hedge funds management groups have been nominated for the annual InvestHedge...
Lenders square off vs. Falcone (NYPost) A group of LightSquared Inc.’s lenders said they oppose extending Philip Falcone’s control of the wireless broadband venture because his strategy to revive the bankrupt company is too risky. LightSquared, which filed for bankruptcy in May, has asked US Bankruptcy Judge Shelley Chapman for a 150-day extension of its exclusive right to control the bankruptcy case. The lenders, who say they own about $1.1 billion of the $1.7 billion in secured debt of the company’s LP unit, objected in a filing yesterday.