Hedge Fund Velite Nabs Natgas Crown From Arnold (Reuters)
Move over, John Arnold: the U.S. natural gas market has a new hedge-fund king, operating as skillfully and mysteriously as the ex-Enron wunderkind who once wowed the trade. For three years in a row, Houston-based David Coolidge has trounced most of his rivals, making Velite Capital one of the best performers in U.S. energy markets that have vexed veterans and handed humbling losses to some of the savviest traders. A former walk-on Texas A&M defensive back who cut his teeth trading for legendary oilman Oscar Wyatt’s Coastal Corp, Coolidge is quietly stealing the thunder of better-known Houstonian Arnold, who has struggled to regain his winning ways for two years running.
Hedge Funds Are Betting on Greek Default, Handelsblatt Reports (Bloomberg)
Some hedge funds won’t accept a plan to cut Greek debt as they are betting that the country will default, Handelsblatt reported, without saying where it got the information. Hedge funds have bought Greek bonds as well as bad-debt insurance in the form of credit default swaps and therefore have no interest in the country’s rescue, the German newspaper said.
Hedge Funds Ask SEC to Let Them Solicit Private Funds Without Registration (Bloomberg)
The Managed Funds Association is urging U.S. regulators to remove restrictions on solicitation and advertising in private offerings to make it easier for hedge funds to raise money and promote their products. The Securities and Exchange Commission should amend its rules to allow private funds to “engage in communication and offering activity while remaining in compliance,” Richard H. Baker, the Washington-based lobby group’s president and chief executive officer, said in a letter requesting the rule change. An SEC advisory group on small and emerging companies voted for a similar recommendation on Jan. 6. The change would let hedge funds avoid the SEC’s registration process while openly seeking money from so-called accredited investors, those deemed sophisticated enough to understand riskier offerings. Changes in securities markets and regulations have rendered the 30-year-old restrictions unnecessary, Baker wrote in the letter dated yesterday.
George Soros Taught Us: The World Can Survive a Currency Union Breakup (WSJ)
When the U.K. pulled out of Europe’s Exchange Rate Mechanism in the early 1990s, some predicted disaster, but that “Black Wednesday” actually brought brighter times to the British Isles. The same story might play out when the euro as we know it inevitably falls apart, despite George Soros’s predictions to the contrary.
Q&A: Hedge Fund Association Spokesman Encourages Strong Relationships With Media (FINalternatives)
In an era of non-stop news, even hedge fund managers, who once shunned reporters’ phone calls, are now being forced to interact with the media. However, confusion remains over just what a fund manager can and should reveal to a reporter. FINalternatives recently spoke with Mitch Ackles, who serves as global director and spokesman for The Hedge Fund Association, about the benefits of building a relationship with the media, and what a hedge fund manager should and should not discuss.
Top 200 Hedge Fund List Faces Tumultuous Quarter; Big Gainers And Losers Lead The Way (Hedge Tracker)
HedgeTracker’s latest Top 200 U.S. Equity Hedge Fund list reveals a challenging third quarter for top 200 hedge funds with total US equity assets declining by more than $125 billion. While many top hedge funds suffered, a number of hedge funds managers were able to weather the storm quite impressively. In fact, thirteen hedge funds saw their ranking increase by more than 30 spots. Leading the way down was John Paulson’s Paulson & Co, which saw its US equity assets fall by $8.5 billion, bringing the firm’s rank down to #3. The firm had securely retained the #1 spot for the first half of 2011. Renaissance Technologies Corporation gained the top spot in this quarter’s Top 200 Hedge Fund List, even after suffering a $2 billion drop in US equity assets.
Hedge Funds Will Be Winners If Greek Bailout Arrives (Deal Book)
Could Greece’s next rescue payout go straight into the pockets of London hedge funds? That, more or less, is the bet that a growing number of investors are making now as they load up on Greek government securities that mature in March. That is when Athens hopes to receive a potentially make-or-break bailout payment — a lifeline of as much as 30 billion euros ($38 billion) from the European Union and the International Monetary Fund.
Hedge Funds Complicate Greek Bailout (FINalternatives)
Some hedge funds are refusing to accept a plan to cut Greek debt, betting instead that Greece will default, reports the German business paper Handelsblatt. Handelsblatt did not reveal its sources, but says the hedge funds have bought both Greek debt and credit default swaps to protect them in the case of a default and therefore have no interest in the success of the bailout agreement. Greece has been trying to persuade its private sector creditors to exchange their existing Greek bonds for longer-term securities—and to take a 50% haircut in the process. Nailing down such a deal is considered key to receiving a bailout payment from the IMF and the EU in March (a payment that could be as high as €30 billion).
Touradji Capital Management Hires Borish As Chief Executive (Bloomberg)
Touradji Capital Management LP has hired Peter Borish to replace Paul Touradji as the commodity fund’s chief executive officer, according to a letter to investors obtained by Bloomberg News. The move will allow Touradji to focus on his role as chief investment officer, he said in the letter, which was dated today. Borish is a former head of research at Tudor Investment Corp., the hedge fund founded by Paul Tudor Jones. Mark Friedman, the founder of hedge fund AM Investment Partners, will join Touradji as director of trading and operations, according to the letter.
Goldman Sachs Wins Dismissal Of Short Sale Lawsuit By Overstock (Bloomberg)
Goldman Sachs Group Inc. (GS) persuaded a judge to dismiss Overstock.com Inc. (OSTK)’s lawsuit alleging the investment bank manipulated short sales of the online retailer’s stock from 2005 to 2007, causing the shares to fall. State court judge John Munter in San Francisco threw out the complaint in a ruling yesterday. The decision comes almost five years after Overstock.com accused Wall Street brokerages of using a practice known as naked short selling to deliberately drive down its shares to allegedly reap security lending fees and appease hedge fund clients who were shorting Overstock.com. Patrick Byrne, chief executive officer of Salt Lake City- based Overstock, has accused investment banks and hedge funds of working together to destroy market value of small-cap companies.
Falcone Urges FCC To Help Solve Lightsquared Interference Issue (Bloomberg)
Hedge fund billionaire Philip Falcone urged U.S. regulators to help resolve interference issues that have delayed government approval of his LightSquared Inc. wireless service. Falcone and two LightSquared representatives met Jan. 4 with Federal Communications Commission staff and “emphasized the significant investment that has already been made in the LightSquared network,” according to a filing posted yesterday on the agency’s website.
ENRC Director Dalman Quits Hedge Fund Toscafund (Reuters)
High-profile banker Mehmet Dalman has left hedge fund firm Toscafund to focus on his other roles, including a directorship at ENRC, the Kazakh miner involved in a messy corporate governance fight last year. Cyprus-born Dalman quit as partner and vice-chairman at the London-based fund manager, which once ran $6-8 billion before its flagship fund fell around 60 percent in 2008, although it later recovered some of those losses.
Hedge Fund Biggie Sanctioned (Thomson Reuters)
Yowza. We’ve seen some sanctions in our days, but this one really stands out, not for the amount of the fine levied, but the surprising nature of the alleged deed and the person who did it. Delaware Chancery Court Judge Travis Laster last week sanctioned hedge fund titan Michael Steinhardt for using non-public information he gleaned during a legal battle between the telecom companies, Occam Networks and Calix Inc., Ross Todd at the American Lawyer reports (tipping his hat to Forbes).
The Euro Is A Buy, Says Jim Rogers (Reuters Hedge World)
Jim Rogers says despite his doubts over the European Union, the euro currency is oversold. Rogers says he may actually add more of the currency to his portfolio while shorting European stocks. “I own the euro,” Rogers says. “I was most delighted to see … in the press that there’s a huge short position. All the hedge funds are now short, short the euro. I was actually thinking about selling some of my euros, but now I’m thinking about buying more euros.”
Bruised Hedge Fund Investors On The Defensive (Financial Times)
“Where next?” is a question to which few hedge fund investors are confident they have the answer. With the outcome of Europe’s sovereign debt crisis far from certain, the US recovery still in doubt and US presidential election ahead, political and macroeconomic risks loom large. A survey of hedge fund managers by the consultancy Aksia found that they listed a stock market rally as the biggest “surprise” ahead, with a chance of this occurring at some point in 2012.
Hedge Funds Now Hold Future Of Europe Hostage (Zerohedge)
After being demonized for everything from the tiniest tick down in the EURUSD, to blowing out spreads in CDS, to plunging stocks across the insolvent continent, hedge funds, long falsely prosecuted for everything, even stuff they patently did not do, are about to have their day in the sun, precisely in the manner we predicted back in June of last year when we posted: “Greek Bailout #2 Is Dead On Arrival: A Few Good Hedge Funds May Have Called The ECB’s Bluff, And Hold The Future Of The EUR Hostage.” Back then we wrote: “we may suddenly find ourselves in the biggest “activist” investor drama, in which voluntary restructuring “hold out” hedge funds will settle for Cheapest to Delivery or else demand a trillion pounds of flesh from the ECB in order to keep the eurozone afloat. In other words, the drama is about to get very, very real.
Insider-Trading Mole Praised by Prosecutors (Value Walk)
The cooperation of a single Wall Street trader in the government’s broad insider-trading investigation directly led to the prosecution of 10 individuals, making him one of the most productive informants in U.S. financial history, lawyers say. The disclosure of the specific role played by the trader, David Slaine, came in a court filing by prosecutors. In a letter to a judge, the U.S. credited Mr. Slaine with being the most important cog in an unprecedented wave of insider-trading cases, which have resulted in guilty pleas or convictions of 53 out of a total of 56 individuals charged by the government since late 2009. “Slaine’s cooperation has been nothing short of extraordinary,” the government said in the filing. “It is difficult to overstate the significance.”
Citi’s 2012 Hedge Fund Optimism, Hedge Funds Sit Out Equity Rally, Lower Bonuses In 2011, Top-Performing Tiger And More (Reuters Hedge World)