Elliott-Funded Avocet Mining Goes into Administration (Reuters)
(Reuters) – Gold miner Avocet Mining Plc on Wednesday appointed Paul Williams and Geoffrey Bouchier from Duff & Phelps Ltd as joint administrators, as it started its insolvency process. The appointments, effective Aug. 21, come a few months after the struggling gold miner said its board proposed voluntary liquidation of the company as it faced mounting debt. Last week, the West Africa-focussed miner said it would pursue a formal insolvency process by appointing administrators to the company, but also remained open to exploring “viable funded investment opportunities”. However, no investment proposals were received, said the miner, which has been relying on loans from hedge fund Elliott Management Corp.
Third Point Names Former BH Macro Chair Huw Evans As Non-Executive (Morningstar.co.uk)
(Alliance News) – Hedge fund Third Point Offshore Investors Ltd said on Wednesday that it has appointed Huw Evans as a non-executive director effective immediately. Evans was chair of investment company BH Macro Ltd until June and is also a non-executive director at London-listed firms Standard Life Investments Property Income Trust Ltd and VinaCapital Vietnam Opportunity Fund Ltd. Third Point said he has also been a non-executive director at a number of companies in Guernsey, where Third the company is based. Shares in Third Point closed 0.3% higher at USD14.75 in London on Wednesday.
A Viking Global Hedge Fund is Growing its Private Investing Team After Pumping $107 million into Software Unicorn Druva Technologies (Business Insider)
Count Druva Technologies as one company that’s benefiting from hedge funds’ push into the private markets. The 10-year-old cloud company reached unicorn status in June after a $130 million funding round led by O. Andreas Halvorsen‘s Viking Global Investors. The firm’s Global Opportunities Fund accounted for $107 million of that round, according to an investor letter sent by Halvorsen on July 16. The $30 billion Viking said it believes that Druva, which has locations in six different countries, is positioned to grow quickly.
Seth Klarman’s 3-Step Approach to Valuation (Guru Focus)
Seth Klarman is widely considered to be one of the best value investors alive today. He has achieved annualized returns of around 20% per annum for investors at his hedge fund Baupost since inception by concentrating on finding undervalued securities, wherever in the world they may be hidden. The value investor approaches evaluation using three different methods. Rather than relying on one single valuation metric or process, such as the discount cash flow analysis, he uses a three-pronged approach. Specifically, when approaching valuation, Klarman calculates a company’s: Net present value. Liquidation value. Sum-of-the-parts stock analysis.
Eurekahedge Hedge Fund Index up 0.62% in July, 6.48% YTD (Opalesque.com)
Opalesque Industry Update – The Eurekahedge Hedge Fund Index was up 0.62% in July, bringing its year-to-date return to 6.48%. Roughly 30.8% of hedge fund managers in the index have recorded double-digit gains over the first seven months of the year. The global hedge fund industry AUM remained mostly flat as of July 2019 year-to-date. Final Q2 2019 net outflows figure stood at US$40.0 billion, as investor redemptions continued to slow down. Hedge fund managers recorded US$46.4 billion and US$94.7 billion of net outflows in Q1 2019 and Q4 2018 respectively. The Eurekahedge North American Hedge Fund Index was up 6.90% year-to-date, as fund managers focusing on the region benefited from the equity market rally throughout the first seven months of the year.
When Going Gets Tough, Hedge Fund Traders Get Better, Study Says (Bloomberg)
Sometimes it takes a crisis to bring out your best. True in politics and marriage, and also, according to a new study, in active fund management. University of Manchester researchers Xinyu Cui and Olga Kolokolova found that during times of outflows, highly paid traders exhibit above-average stock-picking skills. Their paper is called “Do Hedge Fund Managers Work Harder Under Pressure?”
Hedge Funds are Dumping Tech Stocks for Health Care (CNBC)
With the U.S.-China trade war showing no resolution in sight, hedge funds are steering away from battered tech and semiconductor stocks, while bottom-fishing in health care names, according to Goldman Sachs. The fast money continued their rotation from tech to health care, according to Goldman’s latest research looking at 835 hedge funds with $2.1 trillion equity positions. Health care has become the biggest sector exposure for hedge funds at 18% by the end of the second quarter, based on their latest regulatory filings, Goldman said.