Bridgewater’s Dalio Says Capital Markets No Longer ‘Free’ (Bloomberg)
Recent central bank actions mean capital markets are no longer “free,” according to Bridgewater Associates’s Ray Dalio, founder of the world’s largest hedge fund. “Today the economy and the markets are driven by the central banks and the coordination with the central government,” said Dalio, speaking at the Bloomberg Global Asset Owners Forum on Thursday. As a result, “capital markets are not free markets allocating resources in traditional ways.”
Hedge Fund Manager Trips Up as Asset Downgrades Hit CLO (Arizent)
Hedge fund King Street Capital Management has fallen foul of the slew of asset downgrades hitting CLO portfolios amid the coronavirus outbreak. The firm, which issues CLOs through its Rockwood Capital portfolio manager division, failed a portfolio test on its second European CLO at a key date in the transaction’s cycle, known as the effective date. In doing so, it is the first European CLO rated by Moody’s Investors Service to fail to meet all the portfolio requirements at this milestone.
After a Spotty Run, John Paulson Quits Hedge Funds (AI-CIO.com)
The big short is taking the big exit from hedge funds: John Paulson is joining the migration of hedgies to the family office world. Famed for the killing he made during the financial crisis when he shorted the housing market, Paulson, 64, caps off an up-and-down career that has seen a steady leakage of investors from his firm, Paulson & Co. During the 2008 financial crisis, his fund earned some $15 billion—of which $4 billion went to him personally—through betting against the housing market. He shorted mortgage-backed securities via credit default swaps.
Tribune Publishing Gives Co-Founder of Hedge Fund Alden Global a Board Seat (The Wall Street Journal)
Tribune Publishing Co. said it has appointed Randall Smith, the co-founder of Alden Global Capital LLC, to its board, giving the hedge fund further oversight of the newspaper company and extending a standstill agreement between them. The Wall Street Journal earlier reported that both parties were in talks to add Mr. Smith to the board as…
$5.3 Billion Hedge Fund Expands Bitcoin Mining Investment (Forbes)
Core Scientific announced yesterday that the hedge fund and investment manager Horizon Kinetics increased its partnership with the U.S. based blockchain hosting provider. Horizon upgraded its cryptocurrency service, hosted by Core Scientific, to Bitmain Antminer S19 and S19 Pro models. Horizon Kinetics has approximately $5.3 billion in assets under management but did not disclose the size of the cryptocurrency miner investment. Core Scientific stated in their press release that during the last year, Horizon Kinetics had tripled the number of miners it hosts with Core Scientific.
Investors at Point72 and Goldman Sachs Believe Industry Giants like FIS and Fiserv will be the Next to be Disrupted by Fintech. Here’s Where They are Most Susceptible. (Business Insider)
A partner at Point72 Ventures, the VC arm of Steve Cohen‘s hedge fund, expects the next wave of fintech disruption to happen in the less publicized back-end tech that powers big banks. Infrastructure giants like FIS and Fiserv have dominated the banking infrastructure space for decades, but fintechs are looking for ways to reimagine these core banking services. “They are all, as it currently stands, very good businesses with large customer bases who trust them, but the fact of the matter is they’ve fallen behind on technology,” Tripp Shriner, partner at Point72 Ventures, told Business Insider. Shriner isn’t alone in his prediction. Goldman’s investment banking head of fintech also says that the next trend to watch in fintech is players that focus on banks’ core, often dated, infrastructure.