DuPont’s Weak Results, Forecast Seen Providing Ammo To Peltz (Reuters)
DuPont’s weak quarterly sales and lowered annual profit forecast is expected to provide fresh ammunition to Nelson Peltz in his campaign to split up the chemical maker. Peltz’s hedge fund Trian Fund Management has for months criticized DuPont’s underperformance, alleging that the company has repeatedly failed to meet financial targets. Trian, DuPont’s fifth-largest shareholder with a 2.7 percent stake, launched a proxy battle in January for four board seats, including one for Peltz. DuPont has said it could accommodate one of Trian’s nominees, but not Peltz himself.
Einhorn’s Greenlight Capital Buys into GM Again (Reuters)
Hedge fund manager David Einhorn‘s Greenlight Capital has taken a new stake in General Motors Co, nearly a year after selling off it position in the automaker, the firm said in a letter to clients on Monday seen by Reuters. The $11 billion fund believes General Motors has put behind it the impact of recalling more than 2.5 million vehicles in 2014 because of ignition switch problems. It expects GM to begin its $5 billion share buyback soon. Greenlight has been closely watched by investors ever since Einhorn bet against Lehman Brothers months before the investment bank crumbled in 2008.
Hedge Fund Push on Swaps Trades Hits Snag With CFTC’s Giancarlo (Bloomberg)
Hedge fund lobbying hasn’t persuaded a key U.S. regulator that the government should step in to curb Wall Street banks’ power over the $700 trillion swaps market. At issue is a requirement that customers disclose their identities when they buy and sell derivatives on some swap-execution facilities. D.E. Shaw & Co. and Citadel LLC want the Commodity Futures Trading Commission to end the practice, which they say gives banks access to proprietary-investing strategies and discourages trading.
Ex-Lansdowne Partner Kirk To Join Forces With $4 Billion Pelham Capital (Reuters)
Stephen Kirk, who left hedge fund manager Lansdowne Partners last year, has dropped a plan to launch his own independent company and will instead join forces with a $4 billion firm run by a former colleague, a letter to investors showed. Kirk, 45, a former partner at Lansdowne, was in the process of setting up Campden Square Capital in London, aiming to start business with more than $200 million in one of the region’s larger 2015 launches, sources told Reuters in March.
Greenlight’s David Einhorn: We’re Adding Shorts (CNBC)
If corporate earnings are cooked, so is the market. That’s how billionaire investor David Einhorn is betting on stocks—a view that has lost his hedge fund firm Greenlight Capital money so far this year. “All told, there is a good chance earnings will actually shrink this year,” Greenlight’s most recent letter to investors said. “We think the market is too high if earnings have, in fact, peaked for the cycle, and we have reduced our net exposure by adding more shorts.”
Emerging-Market Stocks Resume Rally on China Bets as Ruble Falls (Bloomberg)
Emerging-market stocks rose for the first time in three days as Chinese equities returned to a seven-year high and construction companies led gains in Dubai. Russia’s ruble weakened for a fourth day.“Emerging-market stocks are rallying on China easing expectations and also a strong close to the U.S. markets yesterday,” Michael Wang, a London-based strategist at Amiya Capital LLP, a hedge fund investing in developing countries, said by e-mail. “It is a delayed reaction to the various easing announcements from China.”
Activists Raised Another $3.9 Billion in First Quarter (The Wall Street Journal)
Money is still pouring in to activism. In the first quarter, activist investors attracted $3.9 billion in new net assets, according to hedge-fund research firm HFR. Along with investment gains, that brings the aggregate activist war chest to $127.5 billion. That’s a record aggregate total, and nearly double where the industry was at the end of 2012, when it had $65.5 billion.
Naphtal’s $4.2 Billion Currency Hedge Fund Returns 15% in 2015 (Bloomberg)
Warren Naphtal’s $4.2 billion currency fund gained 15.4 percent in the first quarter after wagering on a strong U.S. dollar versus the euro, according to two people with knowledge of the matter. Naphtal, a former head derivatives trader at Putnam Investments, returned 8.2 percent in March, said the people, who asked not to be named because the information is private.