Editor’s Note: Related tickers: Sony Corporation (ADR) (NYSE:SNE), Fortress Investment Group LLC (NYSE:FIG), Apple Inc. (NASDAQ:AAPL), Herbalife Ltd. (NYSE:HLF), The Blackstone Group L.P. (NYSE:BX), Deutsche Bank AG (USA) (NYSE:DB)
Soros buys big stake in Herbalife (LATimes)
Investing tycoon George Soros has bought a significant amount of stock in Herbalife Ltd. (NYSE:HLF), further complicating Wall Street’s intense interest in the Los Angeles nutritional products company. He’s the latest hedge fund titan to line up for or against the stock since William Ackman, the founder of Pershing Square Capital Management, called Herbalife Ltd. (NYSE:HLF) a pyramid scheme. Ackman bet $1 billion the company’s shares would fall. Soros, whose net worth was estimated at more than $19 billion by Forbes magazine this year, has been researching Herbalife Ltd. (NYSE:HLF) for a year, according to a person familiar with the matter who was not authorized to speak publicly. Soros Fund Management holds more than $8.5 billion in equities, according to a recent regulatory filing.
Sony to reject entertainment spinoff proposal (News24)
Sony Corporation (ADR) (NYSE:SNE)‘s board is likely to reject a US hedge fund’s proposal to spin off part of its profitable entertainment arm, a report said on Thursday, as the electronics giant prepares to report its quarterly results. …Some directors argued that Sony Corporation (ADR) (NYSE:SNE) can compete better as a whole firm instead of hiving off part of the entertainment division, the Nikkei said without citing sources. US billionaire Daniel Loeb, who says his hedge fund Third Point has amassed the largest stake in Sony Corporation (ADR) (NYSE:SNE), called on the Japanese firm’s executives to spin-off up to 20% of the unit, which includes a music label and Hollywood movie studio.
David Einhorn clings to Apple amid concerns of market correction, Marcato Capital may see value in Sothebys real estate, Pharo Macro bets on Greek, Spanish and Italian debt turning sour (Opalesque)
David Einhorn clings to Apple Inc. (NASDAQ:AAPL) amid concerns of market correction From TheStreet.com: David Einhorn of hedge fund Greenlight Capital Management continues to hold an over $1 billion stake in Apple Inc. (NASDAQ:AAPL) as the long and short hedge fund braces for the prospect of a global market correction. “We continue to hold the positions that cost us the most in the quarter,” Einhorn said of the hedge fund’s holding of Apple Inc. (NASDAQ:AAPL) shares during the second quarter. Greenlight owns roughly 2.4 million Apple Inc. (NASDAQ:AAPL) shares worth just in excess of $1 billion as of Monday’s close, according to first quarter data compiled by Bloomberg.
SAC Seen Avoiding $14 Billion Death Penalty From U.S. (Bloomberg)
The money-laundering complaint U.S. Attorney Preet Bharara filed against SAC Capital Advisors LP last week raised the prospect that all of the hedge fund’s $14 billion in assets may be subject to forfeiture. “The government couldn’t put Steve in jail,” said Michael Bachner, a defense attorney and former New York prosecutor. “But they decided to give his money the death penalty.” Bharara seeks forfeiture of “all right, title and interest” in all of SAC’s assets, should he prove his money-laundering case. Rulings interpreting the statute, however, suggest a less drastic outcome is possible for the Stamford, Connecticut-based hedge fund and its founder Steven Cohen.
Who Are Europe’s Hedge Fund Winners? (WSJ)
Want to know who the biggest hedge funds are in Europe? And what are the best performing strategies? A survey by our sister title Financial News lifts the lid. They’ve just done a ranking of the top 20 hedge funds by size based on overall assets under management, which puts Brevan Howard at the top, followed by BlueCrest in second and Man Group in third. Overall growth at the top 20 remained virtually flat in the past 12 months, dragged down by poor performance from managed futures strategies but boosted by buoyant equity markets.
Japan regulator says Singapore-based hedge fund manipulated share prices (Reuters)
A Singapore-based hedge fund manipulated prices in the Japanese equity market and should pay a 431 million yen ($4.38 million) fine, Japan’s securities regulator said, which would be biggest ever imposed against a non-Japanese firm for market manipulation. The Securities and Exchange Surveillance Commission (SESC) said on Wednesday that Juggernaut Capital Management inflated the share price of real estate developer Rise Inc for 26 business days during March and April last year. Efforts to contact Juggernaut founder Yashwant Bajaj in Singapore were unsuccessful.
Average large US hedge fund holds $1.8bn in assets (CityAM)
The biggest hedge funds in the United States held $1.47 trillion (£970bn) in net assets and $1.06 trillion in secured and unsecured borrowings as of the fourth quarter, according to the first report on confidential data provided to the US Securities and Exchange Commission (SEC). Some 823 hedge funds holding over $500m each in net assets have been asked to provide detailed data on their leverage, exposure to risk and liquidity by the SEC, which in turn has been required to collect that information and submit an annual report to Congress on how it has been used under a provision of the 2010 Dodd-Frank Act. This means the average large US hedge fund holds approximately $1.786bn.
Blackstone: Nice Stock, Stupid Product? (YCharts)
Now that the SEC lifted an 80-year ban that kept hedge funds from advertising, the industry faces a bit of a conundrum: what to advertise? As Bloomberg BusinessWeek recently noted in a damning cover story titled “Hedge Funds are For Suckers,” the average hedge fund has underperformed a long-only stock index fund in eight of the last 10 calendar years. …The Blackstone Group L.P. (NYSE:BX), that bastion of exclusivity for the 1% and institutional investors, has come up with another idea: go full-bore retail by offering your wares to the masses. The firm just launched the The Blackstone Group L.P. (NYSE:BX) Alternative Multi-Manager mutual fund that advisors and broker dealers can use for their individual investor clients. Yes, a straight-up, old school, for-the-hoi-polloi mutual fund.
SEC Says Largest U.S. Hedge Funds’ Debt Is More Than $1 Trillion (BusinessWeek)
The nation’s largest hedge funds had $1.47 trillion in net assets and more than $1 trillion in borrowings as of the fourth quarter, according to the first report compiled on confidential data they provided to the U.S. Securities and Exchange Commission. The SEC’s Division of Investment Management issued the report to Congress last week using figures from money managers who run private funds with gross assets of at least $150 million, including borrowed capital, and the agency broke out figures for the biggest firms. Congress ordered the SEC to collect information from private-equity and hedge-fund managers under a provision of the 2010 Dodd-Frank Act designed to help regulators monitor risk in the financial system.
The New Wave of Hedge Fund Activism (InstitutionalInvestorsAlpha)
This is not your father’s hedge fund activism. At the Institutional Investor/CNBC Delivering Alpha conference earlier this month, U.S. Treasury Secretary Jack Lew talked about the importance of the rule of law in the financial world. “I like what he said about how you have to obey the rule of law,” said Richard Perry, CEO of Perry Capital in New York, on the panel that followed Lew’s appearance. It was an inside joke, referring to Perry Capital’s own lawsuit against the U. S. Treasury Department. Since the financial crisis of 2008, the government has been the owner of mortgage guarantors Fannie Mae and Freddie Mac.
Roc liquidates flagship and plans to start over (HedgefundIntelligence)
Roc Capital Management, Arvind Raghunathan’s once fast-growing quantitative equity hedge fund firm, which boasts backing from Deutsche Bank AG (USA) (NYSE:DB) and the billionaire Mittal steel family, is liquidating its flagship fund and starting over with a new employee-funded vehicle after failing to recover from early losses. The Roc Capital Partners Fund will complete its wind down today, according to people familiar with the situation. Roc had $642 million in discretionary assets under management as of March 1, according to its most recent Securities and Exchange Commission filing. The New York-based firm and its core…
Fortress Says Second-Quarter Profit Tripled on Hedge-Fund Fees (Bloomberg)
Fortress Investment Group LLC (NYSE:FIG), the first publicly traded private-equity and hedge-fund manager in the U.S., said second-quarter profit tripled because of higher fees paid to the firm for managing its funds. Pretax distributable earnings, which exclude some compensation costs and other items, increased to $148 million, or 30 cents a share, from $50 million, or 9 cents, a year earlier, New York-based Fortress Investment Group LLC (NYSE:FIG) said today in a statement. Analysts had expected adjusted profit of 20 cents a share, according to the average of seven estimates in a Bloomberg survey.