Hedge Fund Manager Singh Calls Trump’s Handling of Coronavirus ‘An Incredible Gift’ (Reuters)
(Reuters) – President Donald Trump’s handling of the coronavirus outbreak early this year was “an incredible gift” for investors because it kept markets stable long enough for some to protect their portfolios, Axon Capital co-founder Dinakar Singh told investors this month. Trump has justified his public assurances that the virus will quickly go away by arguing he needs to be “a cheerleader” for the United States to avoid creating “havoc and shock.” The United States has the highest number of confirmed coronavirus infections and deaths in the world.
Hedge Fund Challenges Latam Shareholders to Finance Airline’s Bankruptcy (The Wall Street Journal)
Hedge fund Knighthead Capital Management LLC and other investors challenged a proposed loan to carry Latam Airlines Group SA through bankruptcy, saying the rescue financing would enrich some of the company’s largest shareholders. In filings Monday in the U.S. Bankruptcy Court in New York, Knighthead and other Latam creditors criticized the proposed terms of a $900 million bankruptcy loan offered by Latam shareholders, including the Cueto family and Qatar Airways.
Bill Gross Predicts Value Outperforms Growth, Based on Rates Correlation (Reuters)
NEW YORK (Reuters) – Billionaire investor Bill Gross is predicting that value stocks like IBM (IBM.N) and Altria Group (MO.N) are likely to fare better than growth stocks like Apple (AAPL.O) or Amazon.com (AMZN.O) in the near term, due to a correlation with real interest rates. U.S. real yields – which adjust for inflation – have been declining in response to the Federal Reserve’s aggressive monetary actions over the past few months to limit the economic fallout of the coronavirus pandemic. The yield on the 10-year Treasury Inflation-Protected Security (TIPS) US10YTIP=RR has been trading with a negative yield since late March and is now minus 0.803%, near an all-time-low.
Founder Cedes Control of RAM (Hedge Nordic)
Stockholm (HedgeNordic) – Sven Nyman, the founder and majority owner of the Stockholm-based asset management firm running long/short equity fund RAM ONE, has transferred his ownership interest to the company’s CEO and co-founder, Erik Edholm. Nyman and Edholm co-founded RAM Rational Asset Management (RAM) in 2002 to manage RAM ONE, a fundamental equity long/short hedge fund with a focus on Nordic countries. The transfer of ownership is subject to review by Finansinspektionen, the Swedish Financial Supervisory Authority. Nyman left his position as the Chairman of RAM’s Board of Directors at the end of June and has redeemed his investments in RAM ONE and RAM Equity Long/Short, the UCITS version of the flagship long/short equity fund launched in late 2002. Nyman will remain in the company until the year-end.
Activist Hedge Funds Remain in the Red Despite Recent Recovery, as Campaigns Dwindle in 2020 (Hedge Week)
The first half of 2020 has proved tricky for activist hedge fund managers, as performance remained in the red and the number of companies targeted by activists fell to its lowest level in five years. Activist strategies were hit hard earlier in the year by the coronavirus pandemic, but more recently performance has recovered, according to new eVestment data, with managers soaring almost 23 per cent during the second quarter of the year. But despite recent the recent resurgence – which included a 4.71 per cent advance in June – activist hedge funds remain down 6.44 per cent for the year, eVestment research noted.
Virgin Atlantic Set for $1.25 Billion Rescue (Bloomberg)
Virgin Atlantic Airways Ltd. secured a 1.2 billion-pound ($1.5 billion) rescue in a major victory for Richard Branson, who snatched his U.K. airline from the the threat of failure under the weight of the coronavirus crisis. U.S. hedge fund Davidson Kempner Capital Management will provide about 170 million pounds in secured financing, while Branson, its billionaire founder, will contribute 200 million pounds after raising money from his Virgin Galactic Holdings Inc. space venture.