Navistar International Corp (NYSE:NAV) bond yields are rising while those of other U.S. junk-rated truckmakers fall as investors penalize it for an engine design flaw and Carl Icahn expands his influence in the industry. Yields on its notes are up 2 percentage points this year as those on the 20 most-indebted high-yield automotive companies fall, according to Bank of America Merrill Lynch index data. Icahn, who owns 14.8 percent of Navistar’s shares, is offering $3 billion for Oshkosh Corporation (NYSE:OSK) after a failed bid last year prompted speculation of a merger between the two companies.
Greg Coffey and the vagaries of hedge fund management (eFinancialNews)
May I suggest that you go and have a gander at that? We can chat when you’ve finished. Go on. Skedaddle. Shoo! Enjoyed that? Thanks for coming back (sorry I was rude). I think it offers a fascinating insight into the world of high-octane trading: the commitment required, the riches on offer, the big personalities butting horns behind closed doors and the intrigue that results. But, having read it a few times now, I detect something more. It would be too much to suggest that Coffey’s career serves as some kind of parable for the entire hedge fund industry. It is always dangerous to extrapolate from individual examples.
Fund bosses respond to FSA critique (eFinancialNews)
Asset management chiefs have reacted robustly to the Financial Services Authority’s criticism last week that the UK mainstream and hedge fund management industry was generally failing to put its clients’ interests ahead of its own. Responding to claims by Ed Harley, head of the asset management department of the FSA, that many managers were falling below expected standards, and had been “paying lip service” to the idea of putting clients first, Hendrik du Toit, chief executive of Investec Asset Management, said: “The FSA is right to make sure the industry sticks to the standards set for it. But, by the standards of any industry, I would challenge anyone to argue that it is not largely aligned with the interests of its clients.”
PRI launches discussion on responsible investment in hedge funds (HedgeWeek)
The UN-backed Principles of Responsible Investment (PRI) Initiative has issued a discussion paper on hedge funds to help its asset owner signatories better understand the risks associated with particular hedge fund strategies and instruments and the implications these may have for the performance of their portfolios and the broader market. It also outlines some actions that investors can take to improve the governance of hedge funds.
Investors Turn Cautious on Crude (WSJ)
Hedge-fund managers are losing faith that persistently strong crude-oil prices will hold amid a fragile macroeconomic backdrop, both in the U.S. and globally, and an adequate oil supply. Their shift in positions, seen in two recent surveys, could signify that oil prices, which have been declining since hitting a peak in mid-September, could drop further. Money managers, including hedge funds, cut their wagers that Brent crude prices would rise in the week ended Oct. 30 to 91,462 contracts, the lowest number since early August, according to figures reported Nov. 5 by derivatives exchange IntercontinentalExchange Inc (NYSE:ICE) -0.06% That was down 2.7% from the previous week, when there was a 21.4% drop.
Eight Investors Eye Greece’s Stake in OPAP- Privatizations Agency (WSJ)
Greece’s privatizations agency said Saturday eight potential investors have shown interest in acquiring a majority stake in Greek gambling monopoly OPAP, a key asset in the country’s delayed privatizations program. In a statement, the Hellenic Republic Asset Development Fund said private-equity firms BC Partners and TPG Capital, fund Emma Delta Ltd and hedge fund Third Point were among those interested. China’s Fosun International, Estonia’s Playtech and Germany’s Gauselmann were also among those interested, either alone or by taking part in a consortium. Greece is aiming to wind up the sale of a 33% stake in OPAP, which has a market value of EUR1.5 billion, by end of the year or in early January.
Hedge Fund Trader X Review and Bonus of Christopher Castroviejo’s Program Revealed (Melodika)
Some people really do make money trading hedge funds, and in some cases, a lot of money for sure. But the knowledge necessary to do that on a regular basis takes time, effort and a lot of sweat and tears to learn. Christopher Castroviejo says that he’s produced a 12 month so-called, “learning boot camp,” that allows self-taught traders and ordinary investors to earn while they learn. A Hedge Fund Trader X review reveals exactly what Hedge Fund Trader X is offering and what exactly what this training course is all about.
EU risks regulatory own goal with hedge fund rules (Reuters)
European Union regulation intended to ensure hedge funds and private equity groups cannot threaten the global financial system by being “too big to fail” could end up having the opposite effect. Critics of the EU’s Alternative Investment Fund Managers Directive (AIFMD), which is expected to be finalised within weeks, say that rather than drawing secretive asset managers into the regulatory net as its architects intended, it will actually concentrate risk in fewer hands.
Netflix has challenges on path to ‘Internet TV’ dominance (SeattleTimes)
Depending on whom you ask, Netflix is either a company that’s poised for a remarkable resurgence or a washed-up has-been whose best days are behind it. While both sides have a legitimate case to make, corporate raider Carl Icahn is betting on a rebound. While they’re at odds with Icahn, Netflix’s managers — and some analysts — are optimistic about the company’s prospects. The company is basically inventing what it calls “Internet television,” getting smarter about how it operates and is investing in international markets to position itself for long-term growth. “Internet TV is the future of television, and we are leading the charge,” Reed Hastings and David Wells, Netflix’s chief executive and chief financial officers, respectively, said in a letter to shareholders last month.
Carl Icahn Issues Open Letter to Shareholders of Oshkosh Corporation (Melodika)
Carl Icahn today issued the following open letter to shareholders of Oshkosh Corporation: Dear Fellow Oshkosh Shareholders, Oshkosh’s Board of Directors recently sent a letter to all shareholders, rejecting and grossly misrepresenting my offer. The letter is frankly a blatant and insulting obfuscation of my intent and the facts. I have made it abundantly clear that my simple and straightforward intent is to see the price of OSK shares go higher. Unlike management and incumbent directors who are, in my opinion, inordinately concerned with preserving their own jobs, their status and the empire which they have built for themselves, my interests are 100% aligned with shareholders, because I am a shareholder. I have concluded that my tender, along with the subsequent proxy campaign, represents the clearest, most straightforward and least risky path towards realizing a higher share price for all shareholders.
Morgan Stanley sues former employee convicted of insider trading charges (BBR)
US financial firm Morgan Stanley has sued a former employee convicted for insider trading scheme in order to recover $33m, which it claims to have paid to the US Securities and Exchange Commission (SEC) to settle the civil case associated with the fraudulent activities. The lender has filed a case with the Manhattan federal court, and sought recovery of the amount from the ex-FrontPoint Partners hedge fund manager Joseph “Chip” Skowron, reported Reuters. Additionally, the bank sought for unspecified compensation and punitive damages. In August 2008, Skowron acknowledged of being guilty for trading the stock of Human Genome Sciences after receiving non-public information from the biotech company’s consultant.
Citigroup Will Pay Former Chief Pandit $6.7 Million (Bloomberg)
Vikram Pandit, Citigroup Inc. (C)’s ousted chief executive officer, will get about $6.7 million in 2012 compensation and will forfeit some awards tied to a $40 million retention package granted last year. John Havens, who resigned last month as Citigroup’s chief operating officer on the same day as Pandit, will get about $6.8 million for 2012 and also forfeit some awards, the New York- based lender said yesterday in a regulatory filing. Citigroup is the third-largest U.S. bank by assets.
Bulls Cut Wagers as Prices Rally Most in Two Months (Bloomberg)
Speculators cut bullish commodity wagers by the most in five months as prices had their biggest gain in eight weeks on mounting speculation that stimulus measures will bolster economic growth. Hedge funds and other large speculators lowered combined net-long positions across 18 U.S. futures and options by 11 percent to 931,048 contracts in the week ended Nov. 6, the biggest cut since June 5, Commodity Futures Trading Commission data show. Holdings have dropped for five weeks, the longest slump since April. Gold wagers fell to the lowest since August before prices gained the most since January.
SEC Charges Miami-Based Adviser with Hiding Trading Losses and Diverting Client Funds (SEC)
The Securities and Exchange Commission today charged a Miami-based investment adviser for defrauding his clients by concealing trading losses and diverting investor funds for personal use. The SEC alleges that Anand Sekaran and his firm Wasson Capital Advisors Ltd. fabricated documents showing illusory profits after his trading strategy became unprofitable in 2008 and produced substantial losses for clients. Sekaran also misused client funds to pay various personal and business expenses, and he collected fees in excess of what he was due under the arrangements he had with clients.
AllianzGI now competing with sibling PIMCO (PIOnline)
Allianz Global Investors is carving an independent path without its sister subsidiary Pacific Investment Management Co., launching a more integrated business model across asset classes and building its own fixed-income capabilities. A new business structure separated PIMCO from AllianzGI at the start of the year, allowing for more independence for both. The changes also increased pressure on AllianzGI to better distinguish its core competencies to become more profitable, sources outside of the firm said, as it no longer enjoys the operating profit generated by PIMCO.
Sovereign wealth funds now play offense as markets swing (PIOnline)
The NZ$20 billion New Zealand Superannuation Fund’s program of making investments outside of its strategic asset allocation framework when markets diverge sharply from underlying fundamentals has added value since its February 2009 launch, becoming a fixture of the Auckland-based system’s investment strategy, executives say. …Neil Williams, chief investment adviser and head of strategic tilting with the fund, confirmed in a telephone interview that a reduction in the fund’s hedge on foreign currency assets back to the New Zealand dollar was a key factor in the strategic tilt program’s NZ$295 million (US$241.2 million) boost to the portfolio for the latest fiscal year — the bulk of the value added above its passive policy benchmark.
Hedge honcho has love child (NYPost)
Hedge-fund playboy Marc Leder — the wealthy co-CEO of Sun Capital Partners at whose home Mitt Romney made his famous “47 percent” comment — has fathered a love child with an Upper West Side woman, Page Six has exclusively learned. We are told divorced millionaire Leder, 50 — who has previously appeared in Page Six for his sexually charged Hamptons parties — has a 10-month-old daughter with the attractive blonde in her early 40s, whom we’ve agreed not to name.
Red Sox big ‘bags’ fund (NYPost)
The principal owner of the Boston Red Sox, John Henry, is throwing in the towel when it comes to managing money. His hedge fund firm, John W. Henry & Co., announced yesterday that it will “cease managing client assets” by year end. “JWH will continue to engage in proprietary trading and research,” the firm said on its website. The Boca Raton, Fla., firm, allowed Henry to back an investment group that purchased the MLB team for $700 million in 2002. Henry, the son of farmers, launched JWH in 1981 and managed some $2.5 billion at its peak in 2006.
