Legendary Investor Bill Miller Reveals the Biggest Mistake Value Investors are Making Now (CNBC)
Legendary value investor Bill Miller says value plays are not just cheap stocks. He looks for companies focused on high returns on invested capital and free-cash-flow growth. Data assembled for CNBC.com by Morningstar shows little move into growth stocks by value funds. The top value fund this year has been the Copley Fund, returning nearly 12 percent year-to-date. It happens late in nearly every bull market: Complaints that value-fund managers are beginning to “cheat” on their mandates by sneaking growth companies into their portfolios, high valuations and all, goosing performance now but taking big risks on when the next bear market may arrive.
Stemerman Spends $10 million More on Campaign for Governor (CTPost.com)
Greenwich hedge fund mogul David Stemerman will pour another $10 million into his campaign for governor, he said Monday, bringing his total investment to roughly $13 million. Stemerman, a Republican, shuttered his hedge fund, Conatus Capital – which had roughly $1.6 billion in assets under management (down from a peak $3 billion in 2014) – to run his outsider campaign. “At a time when many business leaders downsized or left Connecticut to save their own money, I have decided to invest my own money to help save Connecticut,” Stemerman said in a statement.
Davidson Kempner Severs Ties with Kentucky Retirement Systems (Pensions&Investments)
Hedge fund manager Davidson Kempner Capital Management has terminated its relationship with the Kentucky Retirement Systems, Frankfort, said David Eager, executive director. Mr. Eager said the money manager notified the pension fund of its resignation this spring after expressing concerns about a 2017 pension transparency law that asked managers to abide by CFA Institute codes of ethics and professional conduct as well as a lawsuit filed against other KRS hedge fund managers by state employees at the end of 2017. It managed $68 million for the pension fund.
Hedge Funds Look to Profit From Personal-Injury Suits (The New York Times)
Hedge funds and private-equity firms are deepening their involvement in big-ticket personal-injury lawsuits against drug companies and medical device manufacturers. Investment firms are lending money to law firms that bring so-called mass torts and providing cash advances to plaintiffs involved in such litigation. The activity is increasing just as prosecutors and lawmakers intensify their scrutiny of the industry. Earlier this year, EJF Capital, a $6 billion hedge fund, began raising money for its third investment vehicle that will lend money to lawyers bringing mass-tort cases, according to a February email to prospective investors. The new fund aims to raise $300 million on top of the nearly $450 million the Arlington, Va., hedge fund has already lent to personal injury law firms.
Hedge Funds Paid Big Money for Private Polls on Brexit, and then Made Hundreds of Millions as Markets Went Haywire (Business Insider)
Hedge funds aiming to win big money from the Brexit vote in 2016 hired major polling companies and bought voting data before public release in order to profit from the event, according to a Bloomberg investigation. The information that the pollsters sold gave some hedge funds an indication of the leave vote ahead of time, putting them in the perfect position to profit from market turmoil and a falling pound, according to the report. Polling companies that sold data included YouGov, Survation, ICM, BMG and ComRes, with at least a dozen hedge funds buying the exclusive or syndicated polling data, Bloomberg reported.