M&A Shuffles Roster of Big Funds of Funds (HFAlert)
Some of the biggest fund-of-funds operators grew substantially in the past year, even as total assets in multi-manager vehicles remained flat. Three of the top 10 fund-of-funds shops in Hedge Fund Alert’s annual ranking each added billions of dollars of assets via mergers and acquisitions. They include third-ranked Permal Asset Management, with $23.5 billion in multi-manager vehicles following its acquisition of $6 billion Fauchier Partners. The Blackstone Group L.P. (NYSE:BX), which ranks first with $46.1 billion, expanded its multi-manager business by 14% — not through acquisitions, but by building on its reputation as the industry leader. Rounding out the top five are second-ranked UBS ($25.5 billion), fourth-ranked Grosvenor Capital ($22.3 billion) and fifth-ranked Goldman Sachs Group, Inc. (NYSE:GS) Hedge Fund Strategies ($18.3 billion). Financial Risk Management, which ranks seventh with $16.7 billion, swelled after hedge fund giant Man Group bought the $8 billion firm and consolidated its fund-of-funds business under the FRM banner. Meanwhile, ninth-ranked UBP Asset Management grew via its acquisition of $3 billion Nexar.
Hedge Fund Managers Mixed on 2013 Outlook Despite Strong Performance Predictions (Hedgeco)
Rothstein Kass, a leading professional services provider to the financial services industry, today released its annual hedge fund outlook report entitled “Water Water Everywhere.” Produced by the Rothstein Kass Institute, the firm’s thought leadership arm, the survey, of 358 hedge funds, reveals that despite assets being at an all-time high and predictions of strong performance from most managers, many believe 2013 will be another challenging year for the industry. Those sentiments are based largely on unbalanced capital inflows that have plagued the industry since 2009.
Should the UK Quit Austerity? (CNBC)
Pimco’s Bill Gross, billionaire investor George Soros and the International Monetary Fund have all criticized the U.K. government’s austerity plan.Yet, finance minister George Osborne is sticking to the controversial policy. Last week, Fitch became the second ratings agency to cut the U.K.’s triple-A rating. Osborne has insisted the U.K. must stay the course as public sector net debt has ballooned to 1.2 trillion pounds ($1.85 trillion) or 75.4 percent of GDP. But austerity is hurting growth, which is forecast at just 0.6 percent this year. The U.K. is expected to narrowly miss a triple-dip recession when first quarter GDP figures are released on Thursday morning.
George Soros is playing with fire (Guardian)
Last summer, the financier George Soros urged Germany to agree to the establishment of the European Stability Mechanism, calling on the country to “lead or leave”. Now he says that Germany should exit the euro if it continues to block the introduction of eurobonds. Soros is playing with fire. Leaving the eurozone is precisely what the newly founded Alternative for Germany party, which draws support from a wide swath of society, is demanding.
Investor Jim Rogers May Purchase Gold If Prices Drop to $1,300 (BusinessWeek)
Jim Rogers, who predicted a commodity rally in 1999, said he may buy gold if a bear market deepens and prices fall to $1,300 an ounce or below. Bullion for immediate delivery tumbled to $1,321.95 on April 16, the lowest since January 2011, stoking a frenzy among coin and jewelry buyers from the U.S. to India and Australia. Rogers, the chairman of Singapore-based Rogers Holdings, hasn’t bought any bullion after the slump, he said in an interview. “If it goes to $1,300, I hope I am smart enough to buy some,” he said in Singapore. “If it goes lower to $1,200, I hope to buy even more. If… that’s not a prediction.”
Nouriel Roubini’s five growth triggers for Indian economy (ET)
While stating that India’s economic growth has been slow, Nouriel Roubini, one of Wall Street’s most closely followed economists has expressed confidence in the economy’s growth model, especially compared to China. Roubini thinks the Chinese growth model is not sustainable. He has no doubts that India stands at a point of advantage when it comes to exports of services, even over economies like China and European countries, and the sector has further growth potential. ET takes a look at five economic aspects of India that Roubini spoke on, the challenges that the country faces and the solution to its structural problems.
JOBS Act: What’s at Stake for Asset Managers? (InstitutionalInvestorsAlpha)
A year since President Barack Obama signed the 2012 Jumpstart Our Business Startups (JOBS) Act, hedge funds, asset managers and other sponsors of private placement offerings still eagerly await the completion of rules surrounding the marketing of those offerings to accredited investors. The JOBS Act, designed to boost job development and help small companies raise capital, contains a provision loosening the Securities and Exchange Commission’s long-standing ban under Regulation D on general advertising for private placement offerings, making it easier for hedge funds and others to tap new investors. But consumer advocates say there aren’t enough protections for investors who may lack the sophistication for playing in this alternative market.