Column: Hedge Funds Bet Cautiously on Even Higher Oil Prices (Reuters)
LONDON (Reuters) – Hedge funds added more bullish positions in crude and fuels in the most recent week in the expectation that positive trade talks between the United States and China would keep the global economy expanding. Saudi Arabia’s substantial output cuts and U.S. sanctions on Iran and Venezuela also are restricting crude supplies and helping eliminate a previously expected surplus in the market in 2019. Hedge funds and other money managers were net buyers of Brent crude futures and options equivalent to 9 million barrels in the week to Feb. 19, data from ICE Futures Europe showed.
Steve Eisman Fund Spearheads Neuberger Berman UK Onshore Launch (HedgeWeek)
Neuberger Berman is launching a UK-domiciled fund range, with the group’s first strategy a global long/short equity portfolio run by investor Steve Eisman and team. The new fund range provides UK investors with the broadest accessibility to Neuberger Berman’s innovative investment thinking and differentiated propositions – across its diverse investment platform of equities, fixed income, alternatives and multi asset. Neuberger Berman’s new fund range will deliver solutions in response to the needs and challenges of the UK marketplace, with products often designed in partnership with clients.
Hammerson Wins Investor Elliot’s Backing on More Asset Sales (Reuters)
(Reuters) – British shopping centre operator Hammerson Plc said on Monday it had won the backing of activist investor Elliot Advisors for its plans to sell more assets to cut debt and expand its board. Shares in the owner of malls such as Birmingham’s Bullring and London’s Brent Cross fell about 3 percent, however, as investors focused on a fall in the company’s net asset value and net rental income, hit by lower occupancy.
Warren Buffett’s Stocks Went Down (Bloomberg)
If you are a hedge fund manager, and the stocks that you buy go up, it’s not too hard to write your annual investor letter. “We bought some stocks, they went up, our process works great, now I have a yacht”; it’s all pretty straightforward, and in any case your readers will give you the benefit of the doubt. You have made them money, which is what they really wanted, so if you send them a boring letter it’ll be fine.
Caesars in Talks with Icahn About New CEO as Part of Settlement: Sources (Reuter)
(Reuters) – U.S. casino operator Caesars Entertainment Corp is in talks to offer Carl Icahn a role in selecting its new CEO as part of an agreement that would also give the billionaire investor board seats, people familiar with the matter said on Sunday. The negotiations come after Icahn disclosed a 9.8 percent stake in Caesars on Tuesday and said he could nominate a slate of directors to the company’s board. Icahn also asked Caesars to launch a process to explore a sale. The company responded on Wednesday that all the deals it had explored thus far undervalued it and did not create enough value for shareholders, but noted that it will continue to evaluate strategic alternatives presented to it.
Activist Investor Claims Insurer’s CEO Uses Company Assets to Support Lifestyle (The Wall Street Journal)
An activist investor says a CEO is causing damage to his insurance company’s bottom line by using corporate assets to support his lifestyle and hobbies, and it plans to launch a proxy fight. Voce Capital Management LLC thinks Argo Group International Holdings Ltd.’s board is letting its chief executive, Mark E. Watson III, misuse the Bermuda-based insurer’s assets at the expense of shareholders. It nominated four directors to the board, according to a letter to Argo shareholders published Monday.
Windstream Preparing to File for Bankruptcy as Early as Monday (The Wall Street Journal)
Windstream Holdings Inc., the rural broadband provider that recently lost a legal battle with hedge fund Aurelius Capital Management, is preparing to file for bankruptcy as soon as Monday, according to people familiar with the matter. Windstream’s chapter 11 filing is the culmination of a bruising 18-month legal fight between the telecom company and Aurelius, which had argued a two-year-old spinoff of the company’s fiber-optic cable network violated the covenants on one of its bonds.
Risk/Return: Hedge Funds Prove Their Worth in the Long Run (Preqin.com)
Historically, hedge funds have provided investors with risk-adjusted returns regardless of market conditions. As we approach the 10-year anniversary of the lowest return (676.5) recorded by the S&P 500 PR Index on March 2009, Preqin data captures how various hedge fund strategies have survived the tests of time relative to systematic risk factors. Hedge fund managers that have endured the crisis have produced a 10-year Sharpe ratio of 1.30, more than twice that of the S&P 500 (0.64).