Pershing Square Fund Float Feels the Market’s Chills (WSJ)
The global market for initial public offerings has had a patchy year at best and activist investor Bill Ackman’s latest foray into the arena may not be remembered as a highlight of 2014. Shares in the hedge fund manager’s Pershing Square Holdings Ltd closed-ended fund vehicle, dropped a little over 7% to less than $22 from $25 apiece after the company debuted in Amsterdam Monday, with many investors attributing the weakness to the glum macroeconomic backdrop. …The Amsterdam stock index, has lost more than 6% since the start of October and is down almost 2% on the day.
SEC Delays SAC Settlement Decision (Finalternatives)
The question of what to do with a sizeable chunk of SAC Capital Advisors’ insider-trading settlement remains an open one. The Securities and Exchange Commission last week sought more time to decide how to use the $602 million the hedge fund paid last year to settle allegations of illegal trading in two pharmaceutical stocks. Investors on the other side of those trades, who are seeking some $2 billion from SAC, say the money should go to them. “Our clients were on the opposite side of SAC’s trades and we trust the SEC will ultimately decide to create a Fair Fund here, as it has done in other prominent insider trading cases,” a lawyer for those investors, Ethan Wohl, told Reuters.
US hedge fund Elliott Advisors pays unnamed London executive £38m (TheGuardian)
The US hedge fund that forced Argentina to default on its debts has paid one of its London-based bosses more than £38m – a sum 1,437 times greater than the average UK salary of £26,500. Elliott Advisors, the British arm of New York hedge fund Elliott Management, paid £38,119,707 last year to a senior executive in its UK office, according to accounts filed at Companies House. The firm, set up by US billionaire Paul Elliott Singer in 1977, did not identify which of its London directors collected the multimillion-pound pay cheque, though all the possible candidates are American.
Large hedge funds highly exposed to asset-backed securities (Risk)
Thirty of the biggest hedge funds in the world have large exposures to asset-backed securities (ABS) and US junk corporate debt, according to portfolio stress tests conducted by eVestment. An investor purchasing a basket of these 30 hedge funds has a portfolio exposure of 41% to the Merrill Lynch US fixed-rate ABS index. The investor would suffer a 0.41% loss, were the ABS index to fall in value by 1%, all other factors being constant. The same investor has a portfolio exposure of 6.5% to the Merrill Lynch US crossover corporate index, which tracks the performance of BBB- and BB-rated US corporate debt.
Clearstream opens office in Cork to boost hedge fund processing business (HedgeWeek)
The business transition took place on 5 October 2014 with the integration of 300 former employees of Citco Global Securities Services (CGSS) Ltd in Cork into Clearstream’s Investment Fund Services division. The ownership of the Citco IT systems and software for hedge fund processing has also been transferred to Clearstream. The new Cork-based entity, Clearstream Global Securities Services Ltd, is a 100 per cent subsidiary of Clearstream International SA in Luxembourg and will continue to use its acronym CGSS. The new entity is now Clearstream’s largest operational centre for investment funds and complements the already existing mutual fund servicing centres in Luxembourg, Prague and Singapore.
Investors Cut Hedge Fund Holdings (Finalternatives)
Investors redeemed from hedge funds in October as part of standard quarterly rebalancing of their portfolios, according to SS&C Technologies. The SS&C GlobeOp Capital Movement Index, which represents the net subscriptions and redemptions of hedge funds administered by SS&C’s GlobeOp platform, fell 1% this month. The measure had grown by 0.6% in September. “Net flows were negative for the month, representing typical quarter-end rebalancing,” SS&C CEO Bill Stone said.
Hedge Fund Divorce Couple Get Personal Over Charity (BreitBart)
After months of arguing over who gets what from a family fortune a judge has put at $1.3 billion, the couple appeared before Judge James Holman to argue about documents Hohn said supported his allegations. Hohn’s estranged wife, Jamie Cooper-Hohn, 49, rejects the allegations. She, in turn said Hohn, 47, had been in contempt of court by releasing some of the documents to lawyers representing the trustees of the charity, a position the couple both also shared. The court heard no details about Hohn’s allegations, with much of the hearing concerned with which documents had already been sent to the trustees’ lawyers and what should happen with both them and other documents still to be handed over.
British Chancellor’s Adviser Mulls Hedge Fund Post (Finalternatives)
Rupert Harrison, chief of staff to British Chancellor George Osborne, is said to be mulling a move to a hedge fund. Harrison, whose name has been mentioned as a possible future Conservative Party leader, in spite of the fact that he does not sit in the House of Commons, is reported by CNBC as having had a conversation with Lansdowne Partners co-head Peter Davies—a personal friend of Osborne’s—about a high-paying post with in the private sector. Lansdowne’s relationship to the UK’s Conservative government raised eyebrows after the fund was awarded shares in the Royal Mail’s initial public offering before pension funds were given a look-in.
Janus acquires VelocityShares (Opalesque)
Denver-based Janus Capital Group, the new home of Bill Gross, is out with news of its second major acquisition – VS Holdings the parent company of VelocityShares. VelocityShares is a provider of institutional ETPs and ETFs that manage volatility. Opalesque has previously reported on a number of VelocityShares products and sub-advisory relationships. The products allow investors to go both long and short volatility and offer daily rebalancing. The transaction includes an initial upfront cash consideration of $30 million and is expected to close in the fourth quarter of 2014. The deal will add to Janus’ hedge fund and pension fund books.
Climate Change–Denying Candidates Targeted by Green Billionaire Change Tune (TakePart)
Billionaire former hedge fund manager Tom Steyer is spending $50 million of his own money to make climate change a defining issue in the 2014 midterm elections. That, according to New York Times columnist David Brooks, is just “stupid.” The superrich San Francisco environmental activist could have spent the money “paying for kids to go to college,” wrote Brooks on Oct. 10. “Instead he has spent that much money this year further enriching the people who own TV stations. What a waste.” Except maybe Steyer isn’t as dumb as Brooks thinks. Because a funny thing happened earlier the same week that Brooks lashed out.