Paulson's Fund Lost 47% YTD (Bloomberg)
the billionaire who is betting on an economic recovery by the end of 2012, has lost 47 percent this year in his largest hedge fund, according to three people with knowledge of the matter. Paulson’s Advantage Plus Fund, which seeks to profit from corporate events such as takeovers and bankruptcies, uses leverage to amplify returns. The fund’s gold share class declined 32 percent this year through the end of September, said the people, who asked not to be identified because the fund is private.
Paulson Hit Hard by Selloff (WSJ)
A September selloff in gold has turned a bad year for billionaire investor John Paulson into an even worse one. For much of 2011, Mr. Paulson's largest hedge funds suffered, but his other funds didn't do as badly, thanks to bets on gold and other investments. That changed last month, when the value of almost every fund operated by Paulson & Co. fell sharply. The declines come at a delicate time for Mr. Paulson, who gained prominence by cashing in on a bet against the U.S. housing market and has a net worth recently estimated at $15.5 billion by Forbes.
Intangible Assets Popular with Hedge Funds (BusinessInsider)
As of 2009 there were nearly 10,000 hedge funds worldwide controlling about $2 trillion of assets. Typically one thinks of billionaire managers like George Soros or John Paulson, a speculator and an arbitrageur, respectively, who participate primarily, if not solely, in public markets. Suffice to say neither one of these guys is in the market to make a $2m bridge loan to a land developer waiting on permit approval. But thousands of hedge fund managers are.
Hedge Funds Miss Rally (SFGate)
Speculators cut wagers on higher commodity prices to the lowest since July 2010 just as raw materials had the biggest three-day rally of the year. Money managers cut combined net-long positions across 18 U.S. futures and options by 8 percent to 655,056 contracts in the week ended Oct. 4, data from the Commodity Futures Trading Commission show. The Standard & Poor's GSCI gauge of 24 commodities rose 5.3 percent in the following three days, rebounding from a 10-month low.
Cheyne Capital Disputing £35.3 Million Tax Bill (CityAM)
London hedge fund Cheyne Capital is locked in dispute with HM Revenue & Customs over allegations it has failed to pay £35.3m in tax. The government agency is demanding £29.8m in pay-as-you-earn tax and has lodged a county court claim for £5.5m in national insurance contributions, according to statements in Cheyne’s accounts for the year to December 31. The disputes relate to the tax years 2004-05 and 2006-07.
Raj Rajaratnam Could Face Longest Sentence Ever, Bloomberg Reports (Bloomberg)
Galleon Group LLC’s Raj Rajaratnam faces a federal judge this week who will weigh wildly divergent portraits of the disgraced hedge fund manager while interpreting guidelines that may call for one of the longest insider trading sentences in U.S. history.
Dexia SA Did Operate as Hedge Fund in 2008 (Bloomberg)
Dexia SA Chairman Jean-Luc Dehaene said the bank, bailed out in 2008, functioned as a hedge fund at the time of its first rescue. Following a 2008 analysis of the company’s operations, Chief Executive Officer Pierre Mariani told the chairman that “this isn’t a bank, it is a hedge fund,” Dehaene said today on a conference call from Brussels.
Hedge Fund Employees Will Receive Higher Bonuses This Year on Average (MarketWatch)
As Wall Street works its way toward the end of a turbulent 2011, the bonus expectations of U.S.-based financial markets professionals remain relatively high, driven by steep expectations of stronger bonuses by hedge fund, boutique bank and professional services firm employees. Overall, more than six in 10 (62%) of the Wall Street employees surveyed by eFinancialCareers.com expect their bonus this year will be higher or the same in comparison to the bonus they earned in 2010.
Martin Shkreli Ups Stake in Amag to Prevent Merger (TheStreet)
Several New Funds Coming to Market (eFinancialNews)
Hedge fund manager Martin Shkreli has taken a 5.8% ownership stake in Amag Pharmaceuticals (AMAG
), an escalation of his effort to wrest control of the struggling drug maker and stop a planned merger with Allos Therapeutics (ALTH
). Shkreli must still demonstrate that he has the funds necessary to make good on his previously announced $18-a-share offer for Amag. But Shkreli's purchase of 1.25 million Amag shares -- disclosed for the first time in a regulatory filing Friday night -- may persuade on-the-fence shareholders to accept his proposals and reject Amag's plans to merge with Allos.
New financial regulations have created a gulf between those who need capital and those who have it. On one side stand the banks. They are trying to reconcile an increased cost of capital with political pressure to lend more to small businesses and help kick-start the economy.