George Soros Made A Huge Bet That Stocks Will Fall (BusinessInsider)
It seems legendary hedge fund billionaire George Soros might be souring in his view on the market outlook for U.S. stocks, based on his most recent 13-F filing in the U.S., which showed a 605% increase in his short S&P 500 position (through put options on 11.29 million shares of SPDR S&P 500 ETF) to $2.2 billion. In a 13-F filing three months ago, Soros’ fund had puts on 1.6 million shares, valued at $299.264 at the time. Even though he is still net long stocks, this took the short position (where he owns an option which will profit from a fall in stocks prices) on the S&P 500 from 2.96% of his Soros Funds Management Portfolio to a whopping 16.65%.
Cliffs director resigns; miner must pay ex-CEO $11 million (Reuters)
One of Cliffs Natural Resources Inc (NYSE:CLF)‘s few incumbent directors has stepped down and delivered a stinging resignation letter, filings showed on Friday, as the miner separately said it was on the hook for millions of dollars in payments to its former chief executive officer and others in the wake of a proxy fight. Timothy Sullivan was one of a minority of Cliffs directors re-elected after hedge fund Casablanca Capital triumphed in a proxy battle last month. He had chaired the compensation committee since July 2013. In his letter, Sullivan said he said he had initially been looking forward to continuing at Cliffs, but his view changed after the new board’s first meeting.
Hedge Fund Branding Continues To Drive A Majority Of Asset Flows (Investing)
Since the market correction of 2008, a vast majority of hedge fund net asset flows have gone to a small minority of hedge funds with the strongest brands, marking a change from the pre-2008 environment. A brand is an investor’s perception of the overall quality of a hedge fund based on multiple evaluation factors that evolve over time. A high-quality brand takes a long time to develop, but once achieved, it significantly enhances a firm’s ability to raise capital and retain assets during a drawdown in performance.
Don’t Read Too Much Into Hedge Fund Holdings (Nasdaq)
There is something extremely reassuring about having our biases confirmed, and that is the only reason I can see for the general fascination that surrounds the quarterly filing of hedge fund positions with the SEC. The disclosure forms, known as 13F filings, always attract attention but in reality they tell us nothing for several reasons. They are a snapshot of the holdings of hedge funds at the close of the quarter that were released yesterday. In other words, by the time we see the information it is already 45 days out of date, and 45 days is a lifetime in a trading environment…
All That Glitters Is Gold For Hedge Fund Paulson & Co. (Finalternatives)
Billionaire hedge fund manager John Paulson stuck with his holding in the biggest exchange-traded product backed by gold as prices rose on demand for a haven. Paulson & Co., the largest investor in the SPDR Gold Trust (ETF) (NYSEARCA:GLD), kept its stake at 10.23 million shares in the three months ended June 30, a government filing showed yesterday. The holdings were unchanged for the fourth straight quarter. Gold rallied 9.3 percent in 2014, defying bearish forecasts from Goldman Sachs Group, Inc. (NYSE:GS) and outperforming equities and bonds amid escalating conflicts in Eastern Europe and the Middle East.
Next fight for hedge funds (CNBC)
Ackman Sues Uncle Sam Over Fannie, Freddie (BidNessEtc)
Bill Ackman’s Pershing Square Capital has sued the US Government, demanding revisions to profit distribution at the two Government Sponsored Entities (GSEs)— Fannie Mae (FNMA) and Freddie Mac (FMCC). According to a 2012 revision made by the US Government on profit distribution of the two bailed-out companies, the US Treasury receives all profits generated by the two companies. Ackman’s hedge fund is the largest stakeholder in the two mortgage companies that went down under in the housing market crisis, owning a 10% stake in each. His ownership does not see any gains from the two companies since the government sweeps all profits generated following the $187.5 billion bailout back in 2008…
Hedge Funds in Your 401(k): Do They Fit? (WSJ)
“Alternative” investments have their place. But where is it? Many asset managers argue that nontraditional investments belong in your 401(k) or other retirement account. But with giant pension plans like the California Public Employees’ Retirement System cutting their exposure to hedge funds, and the Securities and Exchange Commission examining how alternative funds are managed, retirement investors should open their eyes before they open their wallets.
Faber Thinks Gold Has Bottomed (TheGuruInvestor)
Marc Faber of the Gloom Boom & Doom Report thinks geopolitical issues will become more important for US markets, and says he thinks gold has bottomed. Faber tells FOX Business Network that the geopolitical issues may well stretch beyond Iraq and Gaza. “There has been some reaction [in Europe] but there hasn’t been much reaction in the U.S. yet,” he says. “I think that geopolitical issues will become more important. At the present time what is dominating the geopolitical discussion is what is happening in the north of Iraq, ISIS and in the Gaza stretch and in Syria but it could spread out to Saudi Arabia…
How David Tepper played ‘nervous time’ market (Yahoo)
David Tepper wasn’t joking when he said it was “nervous time” for the stock market. The billionaire head of the Appaloosa Management hedge fund rattled the markets in May, when he told attendees at the SALT Conference in Las Vegas that he was paring back his equity positions. “I’m not saying go short, I’m just saying don’t be too fricking long right now,” he told attendees in remarks that went viral and immediately sent a shiver into the market.
Brevan Howard Cuts Risk After Losses, Returns to Roots (WSJ)
Brevan Howard Asset Management LLP’s flagship $26.5 billion hedge fund has more than halved its risk levels this year and moved back toward interest rate trading, the specialty of its founders, during a testing 2014. The fund, managed by secretive billionaire Alan Howard and renowned for its profits during the credit crisis, lost money every month in the first half of this year, hit by losses on Japanese equities, U.S. interest rates and currencies such as the Canadian dollar. The fund has now shifted much of its focus back toward interest rate trading, Mr. Howard’s bread and butter, following his time as a developed market rates trader at Credit Suisse Group AG (NYSE:CS).
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