Tag Archives: money

Shorting not good bet for hedge funds

Gulf News – Short-selling, one of the few tactics that made money for hedge funds in 2008, has become a risky bet as prospects for equities have improved, while getting hold of stock to sell is harder as lenders shun weak funds.

Some hedge funds have already changed tactics and are simply buying cheap stocks, wary of getting burnt if a stock they are shorting announces unexpectedly good earnings and the share price spikes – a real possibility in an improving economy.

High-profile hedge fund manager Philippe Jabre said he had no short positions because it was "too dangerous", although in future shorting could prove a better trade.

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Ex-Pimco Palghat to Double Assets in Fixed-Interest Hedge Fund

Bloomberg – Kapstream Capital, Australia’s biggest fixed-income hedge fund, will almost double assets under management in the next month as pension funds seek returns in all market conditions.

The Sydney-based firm has secured investments that will take funds it oversees to A$1.2 billion ($965 million), from A$650 million, said founder Kumar Palghat, Pacific Investment Management Co.’s former head of portfolio management in Asia- Pacific. He aims to raise A$1.5 billion by end-2009 as investors switch to managers that made money even as global markets tumbled last year.

“People are recognizing that there are some opportunities in the credit space and they are more willing to start investing in them now,” said Robert Dasilva, managing director of Asia- Pacific fixed income in Sydney at Principal Global Investors, which manages $228 billion in assets globally.

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For New Jersey Governor, a New Fund-Raising Reality

New York Times Blogs – Of all the gloomy economic indicators since the Wall Street collapse, perhaps the most startling one seen by New Jersey residents is this: Gov. Jon S. Corzine with his hand out.

Mr. Corzine, whose investments include significant holdings in private equity and hedge funds, famously spent $60 million of his own money on a record-shattering Senate race in 2000, then $43 million more laying siege to Trenton four years ago.

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LNG eyes debt play on cash-strapped companies

Reuters UK – Hedge fund LNG Capital is eyeing the debt of companies at risk of running short of cash, seeing the potential for high returns at an early stage of the credit crisis when companies are still able to tap rescue capital.

When a corporate borrower raises money or sells assets to get over a liquidity hump, its discounted short-term bonds — those maturing in up to 18 months — can become a buy, said the fund’s chief investment officer and founder, Louis Gargour.

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LNG eyes debt play on cash-strapped companies

The Guardian – Hedge fund LNG Capital is eyeing the debt of companies at risk of running short of cash, seeing the potential for high returns at an early stage of the credit crisis when companies are still able to tap rescue capital.

When a corporate borrower raises money or sells assets to get over a liquidity hump, its discounted short-term bonds — those maturing in up to 18 months — can become a buy, said the fund’s chief investment officer and founder, Louis Gargour.

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Lehman’s U.K. Administrator Seeks to Return Hedge-Fund Assets

Bloomberg – Lehman Brothers Holdings Inc. may return hedge-fund assets as soon as next year that were frozen when the New York-based securities firm collapsed in the largest bankruptcy on record.

PricewaterhouseCoopers, Lehman Brothers International Europe’s administrator, plans today to ask a U.K. court to block any creditor claims for assets after this year, the accounting firm said in a statement. That would allow PwC to return money Lehman had held in trust for fund managers as soon as the first quarter of 2010.

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Goldman CFO sees end to hedge fund redemption wave

Khaleej Times – Hedge fund assets may be on the rebound after a year of massive redemptions, Goldman Sachs Group Inc Chief Financial Officer David Viniar told analysts on Tuesday, although the prime brokerage business will remain under pressure.

“Assuming (hedge fund) performance stays OK — which it has been through the first half of this year — it feels like we are pretty much through the redemption cycle, and it actually looks like you are going to start to see some money flowing into hedge funds,” he said during a conference call.

The hedge fund business suffered record withdrawals at the end of 2008 as markets imploded, sending the industry’s assets under management down by about 40 percent.


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Hedge funds for Average Joes?

ABC News – Irish-American author J.P. Donleavy, in his wonderful book The Unexpurgated Code, details the difficulties of social climbing in England if you are not to the manor born. People who try to invest in hedge funds will find themselves having conversations similar to those in the book:

You:Hey, what a great hedge fund! Can I invest?

Hedge fund:No.

You:Gee, what a bunch of snobs. I’ve got money, and that’s good enough for me

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Hedge funds still causing some jitters

This is Money – Institutional investors are still running scared from hedge funds after last year’s bloodbath, figures from sector giant Man Group show.

They pulled a net £2bn from Man Group in the first quarter of its financial year. Confidence in hedge funds has been rocked by their poor performance of late.

Keith Baird, analyst at Oriel Securities, said 2008 destroyed the entire theory of hedge funds ability to produce positive returns in any market. He said: ‘The illusion was shattered.’

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Hedge fund investors to demand more data

Reuters – Many hedge fund investors burned by last year’s market meltdown will likely demand a system of checks and balances in which outsiders keep a closer watch over assets, data released on Wednesday show.

Pension funds, endowments and wealthy investors that have long funneled money into loosely regulated hedge funds will want to see more data detailing how their investments are valued and priced, researchers at State Street Corp found.

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Cuddling Up to BDSI

Triangle Business Journal – As BioDelivery Sciences International awaits approval of its first product, a New York hedge fund has gained control of enough BDSI shares to become its largest shareholder.

With what looks like one goal in mind – making a lot of money.

Elliott International Capital Advisors is the same firm that tried to shake up Raleigh-based BDSI with a management change two years ago. That was at a time when the company was developing Onsolis, a small disk placed on the inside of the cheek that quickly delivers the drug fentanyl to cancer patients suffering breakthrough pain.

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Hedge-Fund Guy Points Toward Z-Shaped Recovery

Bloomberg – Dear investor, our statutory obligations demand that we update you on how well we’ve taken care of your money here at Coin-Toss Investment Management.

Attached to this missive is a picture illustrating our fund’s performance this year, showing how wonderfully our back- to-basics approach is working after the derivatives-inspired lunacy of recent years. We’re calling our new strategy “mark- to-flatline” — slow and steady, it sure beats floundering on the double-black expert slopes of last year’s chaotic madness.

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