Hedge Fund News: Ray Dalio, George Soros & Tiger Management

Bridgewater’s Dalio Says Hedge Fund Seeks ‘Radical Truth’ (BusinessWeek)
Ray Dalio, who runs the $160 billion Bridgewater Associates LP, said he’s seeking to encourage a culture of “radical truth and radical transparency” by recording everything inside the hedge-fund firm. “I didn’t want to have spin,” Dalio said at the Bloomberg Markets Most Influential Summit in New York. “We tape everything at the company for everyone to see.” Dalio was joined by former New York mayor Michael Bloomberg, the founder and majority owner of Bloomberg News, parent of Bloomberg LP, in discussing the cultures at their companies…


Merrill Lynch Fires Brokers For ‘Selling Away’ (Finalternatives)
Merrill Lynch has fired two veteran brokers from its private banking and investment group for advising clients to invest in a hedge fund outside the firm. Securities industry rules forbid brokers from selling investments or products not vetted and processed by their employers, an action known as “selling away.” The brokers, Stephen S. Brown and James P. Goetz, were based in Pittsford, New York, and managed about $2.5 billion in assets, a source familiar with their practice told Reuters.

Why Hedge With a Hedge Fund? (BloombergView)
The news last Monday was a shock — the Calpers California earthquake. For a variety of reasons, the California Public Employee’s Retirement System, the nation’s largest public-pension fund, said it was dropping hedge funds from its roster of investment allocations. This tremor will be felt far and wide. We are unlikely to know the full impact of Calpers’s decision for some time, as other pension-fund managers digest the thinking that goes into managing $300 billion in assets…

Hedge funds’ ag selling stalls – except in wheat (AgriMoney)
Hedge funds’ trend of bearish positioning on agricultural commodities stalled, although there were signs this may be down to profit-taking on short positions, while wheat remained firmly out of favour. Managed money, a proxy for speculators, lifted its net long position in futures and options in the top 13 US-traded agricultural commodities, from corn to sugar, by 1,249 contracts in the week to last Tuesday, analysis of data from the Commodity Futures Trading Commission regulator shows.

Hedge Fund Redemptions Fall Slightly In September (Finalternatives)
Hedge fund redemptions measured 3.25% for the month of September, a slight drop from August where they measured 4.19%, according to the SS&C GlobeOp Forward Redemption Indicator. “Forward redemptions were moderate for the month of September, with the bulk of activity representing quarter-end requests,” said Bill Stone, chairman and chief executive officer of SS&C Technologies. The SS&C GlobeOp Forward Redemption Indicator represents the sum of forward redemption notices received from investors in hedge funds administered by SS&C GlobeOp on the SS&C GlobeOp platform, divided by the AuA at the beginning of the month for SS&C GlobeOp fund administration clients on the SS&C GlobeOp platform.

Cramer: Back to business with BABA behind us (CNBC)

Hedge Fund Founder Says The Arrest Of Systema Boss Is A Warning From Putin (HedgeCo)
Hedge fund founder and critic of corruption in Russia, Bill Browder, has a lot to say about the arrest of one of Russia’s richest men, Vladimir Yevtushenkov, The Guardian reports. “I don’t know if Yevtushenkov did anything more or less irritating to Putin than the other oligarchs. I just think [Putin] randomly picked one out to make sure none of the other oligarchs are going to start challenging him or start planning any palace coups.” The Guardian said. “Now that their wealth has been diminished by Putin’s actions, they have a big incentive to act against Putin and he knows that.”

Argentina appeals to a higher authority (FT)
Argentina’s battle with holdout creditors is taking on ever-broader dimensions as Cristina Fernández, the president, appeals for support from the UN this week after meeting with billionaire George Soros and also Pope Francis. In New York, Ms Fernández hopes to recruit George Soros in her fight against the holdouts. His Quantum hedge fund holds a 3.5 per cent, or $450m stake, in YPF, the national oil company that would benefit from renewed access to international credit. She also hopes to build on a rhetorical victory won this month when the UN agreed on a non-binding vote to launch a multilateral framework for sovereign debt restructurings.

Agecroft Partners Predicts 5 Top Outcomes of CalPERS divesting of Hedge Funds (HedgeCo)
CalPERS’ announcement to divest of hedge funds has created a significant buzz in the media with many people wondering what impact this will have on the hedge fund and pension fund industries going forward. Donald A. Steinbrugge, CFA and Managing Partner at Agecroft Partners, believes we will see the following 5 outcomes: Continued pressure on hedge fund fees for large mandates Although the media often comments that hedge fund fees are 2 and 20, the reality is that most large public pension funds on average pay significantly less than this for large investment amounts.

Hedge Fund Icon Julian Robertson: Bond Bubble Will Burst (Barrons)
Is there a bubble in bonds? In remarks at the Bloomberg Markets Most Influential Summit in New York, Julian Robertson, the founder of Tiger Management LLC, said there is a bond bubble that will “end in a very bad way.” According to Bloomberg, the hedge fund icon said, “Bonds are at ridiculous levels. It’s a worldwide phenomenon that governments are buying bonds to keep their countries moving along economically.” Not everyone agreed, according to reports. Joining Robertson on stage, Carlyle Group LP co-founder William Conway said he didn’t see a catalyst that would cause the bond market to collapse.

You Too Can Clone Bill Ackman Without Buying His New Fund (Bloomberg)
Billionaire activist Bill Ackman’s three-year pursuit of a European initial public offering may appeal to institutions seeking greater liquidity and affluent individuals shut out of many U.S. hedge funds. Yet as even Ackman has suggested, investors might do better replicating him on their own. Pershing Square Holdings Ltd. (PSH), one of the funds managed by Ackman’s Pershing Square Capital Management LP, seeks to raise about $2 billion in an IPO in October on the Euronext Amsterdam. Ackman wants the listed fund to provide a pool of permanent capital as a buffer against the risk of investor withdrawals that loom over private funds.

Recommended Reading:

Bronson Point Partners 2014 Q2 Investor Letter and Returns

Arrowgrass Capital 2014 Q2 Investor Letter

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