Investor Ray Dalio Estimates the Corporate Losses in the US from Coronavirus will Top $4 Trillion (CNBC)
Investor Ray Dalio told CNBC on Thursday the coronavirus outbreak will cost U.S. corporations up to $4 trillion, and “a lot of people are going to be broke.” “What’s happening has not happened in our lifetime before … What we have is a crisis,” Dalio said in a “Squawk Box” interview. “There will also be individuals who have very big losses. … There’s a need for the government to spend more money, a lot more money.”
Englander’s Millennium to Shut Some ‘Trading Pods’ as Coronavirus Bites – FT (Reuters)
March 19 (Reuters) – Millennium Management has closed many of its “pods” run by teams of traders, as violent market swings caused by jitters over the economic fallout of the coronavirus led to losses, the Financial Times reported here citing two sources. Millennium, one of the industry’s biggest hedge funds, has closed “trading pods” in double-digit numbers, the report said, adding that job cuts at the firm that runs between 150 and 200 pods are expected.
Ben Levine’s LMR Raises Capital After Hedge Fund Drops 12.5% (Bloomberg)
LMR Partners is raising capital after its main hedge fund suffered heavy losses amid the coronavirus-fueled implosion in global markets. The $4.6 billion LMR Fund slumped 12.5% in the two weeks through March 13, according to people with knowledge of the matter. The setback led LMR to reduce its bets and stop some traders from investing, a step hedge funds typically take as part of their risk-management response to stem losses, said the people, who asked not to be identified because the information is private.
Starboard Nominates Four to eBay’s Board, Wants Outsider as CEO (Reuters)
(Reuters) – Activist investor Starboard Value is pressuring eBay for the second time in two years and said on Thursday that it plans to install four directors on the e-commerce company’s 14 member board. The hedge fund, which last year helped fill one board seat, said the board had been slow in changing its chief executive and tackling issues including separating eBay’s classifieds business from its marketplace business.
Put to the Test on Day One (Hedge Nordic)
Stockholm (HedgeNordic) – DNB Asset Management launched a multi-strategy, multi-asset absolute return fund on February 25, during a week that saw some of the largest stock market declines since the financial crisis of 2008. As one turbulent week ended, DNB Fund Multi Asset faced a few more weeks of heightened volatility, uncertainty and falling prices. “It would be a lie not to say that it has been a challenging start,” portfolio manager Anette Hjertø tells AMWatch. Despite launching in an extremely challenging market environment, DNB Fund Multi Asset was down 4.7 percent month-to-date through March 17. The fund is down 6.3 percent since launching on February 25. “Considering the market development, the fund has delivered as expected,” says Hjertø, who is part of a three-member team responsible for managing the fund. “We would have, of course, preferred to start off with a positive return,” she adds.
Ex-Tudor Manager’s Investment Firm Scores Big in Market Turmoil (Reuters)
LONDON (Reuters) – An investment firm founded by a former senior portfolio manager at Tudor Investment Corp, Theodoros Tsagaris, is up 17.7% since the start of March, when markets went into a coronavirus-fueled tailspin. Bayforest Technologies, the short-term systematic money manager he set up after 6-1/2 years at Tudor, is up 18.8% since the start of the year and had just one day of losses in March.
Healthcare Hedge Fund Rhenman Sees Sector Dispersion as Coronavirus Grips Markets (Hedge Week)
Rhenman & Partners Asset Management, the Stockholm-based hedge fund firm which invests in global healthcare stocks, says the industry has not been shielded from the impact of Covid-19 – though different sub-sectors have been impacted in markedly different ways. The Rhenman Healthcare Equity Long/Short Fund – which trades a range of small, medium and large pharmaceuticals, biotechnology, medical technology and service company stocks – fell more than 3 per cent during February, as the market reversal on the back of the Coronavirus outbreak began to bite. The USD700 million strategy, which launched in 2009, returned an eye-catching 40 per cent last year, but was down 7 per cent in the first two months of 2020.
China’s PEVC Fund Managers See Deal Activity Recovering as its Coronavirus Cases Diminish (Preqin.com)
As the number of new coronavirus infections in China dwindles and businesses begin to resume trading, local private equity & venture capital (PEVC) fund managers say they expect deal activity to recover in the coming months. The coronavirus pandemic, which started in the city of Wuhan in Hubei province about three months ago, has roiled the world’s second-largest economy. In January and February retail sales fell by 20.5% compared with the same time last year, while industrial output slid by 13.5% and fixed-asset investment dropped by almost a quarter, according to the country’s National Bureau of Statistics. The volume and value of PEVC deals tumbled during this period, Preqin data shows. Venture capital deal activity was especially hard hit: aggregate deal value plunged by 63% to $2.8bn, while the number of deals more than halved, from 564 in Jan-Feb 2019 to 241 in Jan-Feb 2020. Deal activity in the private equity-backed buyout market, which is smaller by comparison, was also reduced. Aggregate deal value fell by 57% to $0.3bn, and the number of deals slipped from nine to just six when comparing the same periods.