Sony drags down Loeb’s October returns (NYPost)
Hedgie Dan Loeb’s long winning streak continued in October — although a 20 percent drop in his high-profile activist target Sony Corporation (ADR) (NYSE:SNE) nearly wiped out his overall gain. Loeb’s Third Point hedge fund ended the month with a 1.2 percent gain, lagging the S&P 500’s 4.6 percent return. He is still up 19.4 percent for the year, according to a report to investors, a copy of which was reviewed by The Post. Although his 2013 gain trails the S&P’s 25.3 percent year-to-date gain, Loeb’s fund this year remains one of the industry’s top performers.
Capital introduction favours large hedge funds (Risk)
The role of capital introduction has changed significantly, pushing up barriers for emerging managers. In an increasingly institutional world where the fight for every dollar of new capital is tougher than ever, hedge funds, the prime brokers who dominate the ‘cap intro’ space and institutional buyers are all attaching more value to the intelligence, rather than the pure introductions, that cap intro teams provide. The result is a shifting focus in the cap intro process away from helping establish emerging managers towards favouring larger funds. Nowhere is this more prevalent than Europe, where it should also be noted that lack of clarity surrounding the alternative investment fund managers directive (AIFMD) leaves questions unanswered about how and whether capital introduction will be able to function in the future.
Pershing enhances PrimeConnect collateral management application (HedgeWeek)
The new connection to Pershing’s Fully Paid Securities Lending programme allows hedge funds, through a fully automated solution, to transfer fully paid securities from BNY Mellon to Pershing, at which point the securities are available to be borrowed by Pershing. It also allows hedge fund managers to be able see the earning potential for fully paid assets in the Prime Services dashboard on NetX360, Pershing’s technology platform.
Quant funds suffer dismal ‘QE’ losing streak (FT)
How does a hedge fund react to losing a quarter of its investors’ money in a matter of months? Double-up? Blow up? Or buy Lego and wait? Cantab Capital, a multibillion-dollar quant hedge fund, run by computers (or rather, run by maths geeks who run computers) went for option three. The irreverent – and until this year, highly profitable – Cambridge-based firm, set up by Goldman Sachs Group, Inc. (NYSE:GS)’ former head of quantitative trading, spent £2,000 on Lego to boost staff morale this summer after a painful losing streak struck hundreds of millions off its trading portfolio’s value.
Swiss fund Gottex enters China with VStone in Asia push (Reuters)
Swiss fund-of-hedge-funds manager Gottex will form a joint venture with China’s VStone Asset Management, to further its aim to invest in Asia and raise capital from the region. Founded in 2008 by Dr Jiwu Chen, a former chief investment officer at Fullgoal Fund Management and China Life, VStone will help Gottex establish a foothold in Asia’s biggest economy and help its global clients get access to China investments. “The objective is to build out Gottex capability in China and to be able to provide our investors access to China’s onshore markets across equity, fixed income and private equity,” Gottex co-founder Max Gottschalk told Reuters.
Greenwich Global Hedge Fund Index up 1.86%, 7.36% YTD (Opalesque)
Stronger equity market performance in October helped the Greenwich Global Hedge Fund index increase 1.86% for October 2013. Despite an early market selloff due mostly to the US debt concerns, the resolution of the Government Debt Crisis and continued bond buying by the FED helped the S&P 500 increase +4.46% hitting a new closing high of 1757 at month end. Long-Short Equity was the best performing strategy in October up 2.18% closely followed by Multi-Strategy up 2.00%. All eight major hedge fund strategies ended October firmly in positive territory. Futures funds had their first good month of the year adding 1.90% in October to bring their year-to-date return to -1.69%.