Hedge Fund Video Library | 30+ Free Videos on Hedge Funds by Richard Wilson

Hedge Fund Lock Up Provision

Hedge Fund Lock Up Provision

Hedge Funds Still Locked Up $100 Billion from Investors

A few hedge funds are holding tough against investors redemption requests with a "sliver" of the industry refusing to liquidate their portfolios that are currently locked-up. Although the vast majority of hedge funds have liquidated their portfolios and bowed to redemption requests, it is believed that there are still $100 billion locked up by some hedge funds.  

Many hedge fund managers with lock-ups requested patience from investors before returning their money and providing a more liquid portfolio.  The industry came under some fire from investors after some wanted to withdraw money from funds during the crisis but found that their money was tied up under a lock up provision.
Industry observers said that time is up for hedge fund managers that aren't finished liquidating their portfolios and honoring redemption requests.

Most hedge funds that had liquidity problems “have gotten to the point where 95% to 99% of their portfolios are cleaned up,” said a hedge-fund-of-funds manager who asked not to be identified.

“There are these small dregs left in their portfolios, hedge fund rumps that don't go away, that you don't forget about, that are distracting and annoying but which aren't headline news,” the manager said.

But there remains a “sliver” of funds stubbornly hanging on to more than a slight percentage of their portfolios, and those funds aren't returning money to investors who want it back, said Geoff Varga, a partner and leader of the insolvency-and-distressed practice of Kinetic Partners U.S. LLP, a business consultant to money managers. Source

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http://richard-wilson.blogspot.com/2011/05/hedge-fund-lock-up-provision.html

Full Day Workshop on Hedge Fund Marketing Materials & DDQ

Full Day Hedge Fund Marketing Materials Event

The full day Hedge Fund Marketing Materials Workshop is coming up on Tuesday June 7th, 2011 at the exclusive Buckhead Club in Atlanta, GA.  This is a great opportunity to learn from capital raising experts and improve your fundraising techniques.

Attend this workshop for a guaranteed productive day by drastically improving your hedge fund pitch book and due diligence questionnaire (DDQ). Enjoy the fully catered breakfast, lunch, and the networking session included with your registration for free.

This Exclusive Marketing Materials Workshop Will Cover:
  • The 23 critical components of a hedge fund pitch book that you must have in place in order to maximize investor response and engagement
  • A checklist for what you should have in place for your entire hedge fund marketing campaign including your one pager, single page FAQs, newsletter, website, DDQ, and pitch book
  • Exactly what you should NOT place in your pitch book that is probably there right now, avoid this common mistake.
  • What your investor avatar looks like, and how understanding this concept will shift your entire marketing approach, making it more focused and effective
  • A list of words that you can use in your marketing materials that will jump out at investors, grab their attention, and show them that you understand their concerns and the risks they are considering while investing in your hedge fund.
To register or learn more about this full day workshop please read below.  If you need to print out the details on this workshop please download our workshop brochure in  PDF or Word format.

If you have any questions about our Atlanta workshop on Hedge Fund Marketing Materials or our other services please call Ashley on our team during west coast (PST) business hours at (212) 729-5067 or just reply to this email. 

Related to: Hedge Fund Update

Tags: Hedge Fund Marketing Materials, Creating Hedge Fund Marketing Materials, List of hedge fund marketing materials, what hedge fund marketing materials are needed to start a fund or raise capital?

Link to This Resource: Full Day Workshop on Hedge Fund Marketing Materials & DDQ

http://richard-wilson.blogspot.com/2011/05/full-day-workshop-on-hedge-fund.html

The Rapidly Growing Hedge Fund Industry in Singapore

The Growing Hedge Fund Industry in Singapore


I just returned from a trip to Singapore (pictured left) and Tokyo where I spoke at a hedge fund conference, recorded video content, and met with hedge fund managers, service providers, and a University professor to learn more about Asia in general and how the hedge fund industry is growing in Singapore and Tokyo.

I was surprised to learn that almost everyone I spoke with in Singapore and Tokyo believe that hedge funds are flooding into Singapore more quickly than anywhere else in Asia, including Hong Kong.  Consistently, everyone told me that Singapore has lower taxes, less regulations and red tape, and a higher standard of living for startups with moderate budgets.

Here is a short video I recorded on the waterfont in downtown Singapore discussing how fast the city is growing and providing few statistics as to how much wealth is really there.  I believe this is a place to watch for both capital raising and hedge fund industry growth:

Thanks for watching,


 

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Tags: Singapore hedge funds, hedge fund managers in Singapore, the hedge fund industry in singapore, capital raising singapore, hedge fund investors singapore

Link to This Resource: The Rapidly Growing Hedge Fund Industry in Singapore

http://richard-wilson.blogspot.com/2011/05/rapidly-growing-hedge-fund-industry-in.html

David Einhorn New York Mets

David Einhorn New York Mets

David Einhorn Looking to Buy Stake in New York Mets

Earlier this year there was talk that Steve Cohen was considering buying a stake in the New York Mets baseball team. Now, it appears that another hedge fund magnate, David Einhorn, has beat him to the punch. Einhorn is in talks to purchase a non controlling stake in the Mets worth $200 million.
But Mr. Einhorn — one of a handful of hedge fund managers followed by investors looking for the next smart play — insists that he spends far more time trolling through the bargain bin, looking for companies with potential that others have dismissed, then betting on their long-term revival.

On Thursday, in announcing that he has entered into exclusive negotiations to spend $200 million for a noncontrolling stake in the Mets, Mr. Einhorn, 42, may be making one of his most intriguing long-term bets yet.

The Mets, as their principal owner said in comments published this week, are lousy, snakebitten and bleeding cash, having lost $50 million last year alone. Attendance has plummeted at Citi Field, their expensive new ballpark in Queens. Perhaps most daunting, the trustee for the victims of Bernard L. Madoff’s Ponzi scheme has sued the team’s owners for $1 billion. Source

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Hedge Funds Currencies Trading

Hedge Funds Currencies Trading

Hedge Funds Hurting From Volatile Currencies

Hedge funds are struggling to make returns trading in particularly volatile currencies. Many funds with strategies focused on currencies and other macroeconomic trends have been hit with losses in the last few months. Several of the hedge funds that are having trouble in currencies are the biggest names in the industry including Brevan Howard Asset Management and Tudor Investment Corp.
So-called macroeconomics funds, which make wagers on currencies and global economic events, were down 0.8% on average in the year to May 19, according to hedge-fund research firm HFR, with a 3.1% loss this month. And "systematic" macro funds that use computer programs to jump on market trends have given up 4.5% since Dec. 31. By contrast, hedge funds in general have returned 1.7%. Investors who bought U.S. blue-chip stocks instead of hedge funds have gained about 7%.

The list of losers reads like a Who's Who of the hedge fund world: A roughly $2.5 billion fund run by Geraldine Sundstrom at London's Brevan Howard Asset Management LLP, one of Europe's biggest hedge-fund firms; an $8 billion fund run by hedge-fund giant Tudor Investment Corp.; Caxton Associates' $5 billion Global Investment Ltd. fund; and New York-based Moore Capital Management's $7.5 billion Moore Global Investors fund, according to a report by HSBC Private Bank obtained by The Wall Street Journal.

The lackluster performance comes at a testing time for global financial markets. Traders are debating whether slower global growth and Europe's debt problems will scupper a two-year market boom. That uncertainty is making currencies more volatile and preventing clear trends and strategies from emerging. Source

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Tags: Hedge Funds Currencies, Hedge Funds Trading,  Hedge Funds Currency Exchange, Hedge Funds ForEx, HEdge Funds Foreign Currencies, Funds Currency

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http://richard-wilson.blogspot.com/2011/05/hedge-funds-currencies-trading.html

Steven Cohen Investigation

Steven Cohen Investigation

Senator Grassley's Investigation of SAC Capital Expanding

One of the biggest hedge funds in the world may be in for even more attention from Charles Grassley. The Office of Senator Grassley is reportedly expanding its investigation into SAC Capital Advisors LP (SAC). Steven Cohen's hedge fund firm is being investigated for a number of suspicious trades.
Even as the rhetoric heats up, there have been no allegations of any crime by SAC or Cohen.

Instead, specific instances of at least twenty separate, “questionable” trades have been disclosed by Grassley’s office. Following the conviction earlier this month of Raj Rajaratnam, the world of hedge fund traders have been waiting to see if further investigations are coming.

The role of hedge fund managers, who often invest their own funds alongside investors, has become a lightning rod for critical congressional investigators, such as Grassley.

Spokespeople from Senator Grassley’s office have so far declined any other specifics about the SAC investigation: “(We) can’t offer any specifics of the information received from Finra on SAC, at the request of the investigative agencies involved.

The allegations of hedge fund managers trading on possible “insider information,” and Grassley’s official reluctance to disclose any specifics, suggests Congressional inquiry may be paralleling Department of Justice investigations. Source

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Link to This Resource: Steven Cohen Investigation

http://richard-wilson.blogspot.com/2011/05/steven-cohen-investigation.html

Morgan Stanley Asian Hedge Funds

Morgan Stanley Asian Hedge Funds

Morgan Stanley Considers Funding to Asian Hedge Funds

Investment bank Morgan Stanley is in talks to boost its funding to more Asian hedge fund start-ups this year. This would represent another step into the Asian hedge fund area from Morgan Stanley, following where investors are allocating money to.  Investment banks, hedge funds and private equity firms have all been working to position themselves for the massive potential gains to be had in Asia.
The New York-based bank is helping negotiate several opportunities for investors to give money to new hedge funds for a share of their fee revenue and deals in which they will provide capital to expand assets across Asia, said Hugh Abdullah, its Hong Kong-based head of capital introductions in the region. In demand are event-driven funds and equity long-short managers who bet on rising and falling stocks, he said.

“True hedge fund talent is a scarcer resource out here,” said Abdullah in an interview yesterday. “People always want to find the next winner.”

Investors added $3.6 billion of capital to Asia-focused hedge funds in the first three months, the largest quarterly inflow they have attracted since Chicago-based Hedge Fund Research Inc. started to track such data. Managers in the region are courting seeders and those who can provide so-called acceleration capital because the $88 billion Asian industry is still hovering at 79 percent of its 2007 size, even after global hedge fund assets hit a record $2.02 trillion by March, according to HFR.

Investors provide seed capital to new hedge funds typically in exchange for a share of their fee revenue and sometimes an equity stake in the business. Acceleration capital helps small managers which have been in operation for a few years to expand assets to a size that could attract institutional capital. Source

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http://richard-wilson.blogspot.com/2011/05/morgan-stanley-asian-hedge-funds.html

Charles Grassley SAC Capital

Charles Grassley SAC Capital

Senator Charles Grassley Investigating SAC Capital Trades

US Senator Charles Grassley has taken a special interest in trades made by SAC Capital. The senator is focusing on about twenty suspicious trades made by Steve Cohen's hedge fund. Senator Grassley has requested information on suspicious trades made by SAC traders and executives dating all the way back to 2000.
Charles Grassley, a Republican from Iowa and the senior member of the Senate Judiciary Committee, previously had pressed the Financial Industry Regulatory Authority for information on “the potential scope of suspicious trading activity at SAC Capital.”

In a letter sent on April 26, Mr Grassley asked Richard Ketchum, Finra chairman, for details of all referrals related to SAC Capital sent to the brokerage regulator since January of 2000.

Finra sent Mr Grassley information on about 20 suspicious instances of trading by SAC and SAC executives met with Mr Grassley’s staff earlier this month.

“We welcomed the opportunity to meet with the staff to educate them about the firm and our compliance efforts, and had an entirely appropriate, professional and cordial meeting. We will continue to cooperate in any way we can,” a spokesman for SAC said.   Source


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http://richard-wilson.blogspot.com/2011/05/charles-grassley-sac-capital.html

Hedge Funds Leverage

Hedge Funds Leverage

Report Shows Hedge Funds Are Using Less Leverage

Hedge funds have been employing less leverage over the last twelve months. According to a recent report, the average standard leverage for all hedge fund strategies fell from 1.27 to 1.10 times investment capital and average margin to equity also fell from 17.13% to 16.98% year on year.
HFR says average standard leverage decreased across all hedge fund strategies from 1.27 to 1.10 times investment capital, while average margin to equity also declined, falling from 17.13% to 16.98% year on year. Moreover, approximately one-third of all funds used no leverage—an increase of 4% over 2010, while over half of all funds use leverage of between one and two times their investment capital.

Larger funds tend to employ more leverage, thus HFR’s report shows 23% of funds with AUM over $1 billion use leverage of between two and five times their investment capital.

The study also points out that although funds employing leverage usually experience greater volatility, the difference in performance between leveraged and non-leveraged funds since 2005 is not statistically significant. Source

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Link to This Resource: Hedge Funds Leverage

http://richard-wilson.blogspot.com/2011/05/hedge-funds-leverage.html

SAC Capital Quantitative Fund

SAC Capital Quantitative Fund

SAC Capital to Launch Quantitative Hedge Fund This Year

SAC Capital Advisors is expected to launch a quantitative hedge fund this year at the behest of current SAC investors. The hedge fund will be managed by twenty teams of SAC Capital's quantitative traders.
SAC Capital Advisors plans to launch a new quantitative hedge fund later this year after seeing assets climb by more than $1 billion in recent quarters, Bloomberg News reported Thursday, citing two unidentified people familiar with the decision.
The hedge fund will be managed by 20 teams of so-called quant traders at SAC, Bloomberg said. These types of funds use computer models to spot trends and anomalies in securities markets.
Current SAC investors asked the firm to open the fund. It's expected to launch in the third quarter, Bloomberg added, while noting quant investing makes up about 15% of the roughly $35 billion, including leverage, that the firm manages.
SAC was subpoenaed by the government last year as part of a broad investigation into potential insider trading in the $2 trillion hedge-fund industry. Two former traders from the firm have pleaded guilty to charges stemming from the investigation. Source

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Returns Invested in Children and Education

Returns Invested in Children and Education

Asian Hedge Fund Charity Raising Money for Minors

Returns Invested in Children and Education is a charity set up by the Asian hedge fund community. The charity is trying to raise more money for minors, especially the ill in Cambodia and those in India's brothels. It is looking to expand its charitable fundraising after registering as an International Charitable Organization in September.

Returns Invested in Children and Education, the charity set up by Asia’s hedge-fund industry, is stepping up efforts to raise money for minors, including the sick in Cambodia and those growing up in India’s brothels.

The charity, known as RICE and started by hedge fund managers in 2006, is seeking to widen the source of its funds and allocate the money to projects in Asia after registering in Singapore as an International Charitable Organization in September, said Paul Smith, the international chief of its fund- raising committee. It previously raised money privately and was funded mainly by a few wealthy individuals, Smith said.

Asia-focused hedge funds attracted more than $3.6 billion in net new capital in the first quarter, taking the industry’s total assets to $88 billion as investors returned after the global financial crisis, lured by the region’s economic growth that is outstripping the rest of the world, according to the Chicago-based research firm Hedge Fund Research Inc. Source



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Defining Your Investor Avatar To Raise More Capital

Raise More Capital With Your Investor Avatar

Investor Avatar Definition:  An investor avatar is a well defined picture of the exact type of investor that your fund is targeting to raise capital from.

It is critical that your capital raising efforts and marketing materials are crafted to speak directly and powerfully to a single type of investor. If your investment fund is ideal for wealth management firms to invest in than it is important that your PowerPoint presentation, newsletters, conference calls, and educational marketing materials must be customized for that marketplace.  If you haven't already, check out my video on persuasive writing for capital raising and why it is so important here: http://richard-wilson.blogspot.com/2010/01/why-bad-copywriting-can-kill-your.html

Investors want you to have a well defined avatar in mind while raising capital because you waste less of their time when you do.  By being exclusively focused on one or two types of investors you will ensure that you have considered their needs, challenges, and other choices in the marketplace. 

Take a few minutes right now and think about which 1-2 types of investors you are focusing on primarily. Now think about what is absolutely unique about that investor, what is their history in investing in your type of investment fund?

What risks are they considering while looking to invest in your fund?

Why would they not invest?

How educated are they about your type of fund and asset class? 

Thinking about these questions as a team can help upgrade your marketing materials and approach to capital raising.  This is something that we cover in-depth at our full day live workshops that we hold several times a year.  

Hope to see you at one of these workshops in person soon, take care.




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http://richard-wilson.blogspot.com/2011/05/defining-your-investor-avatar-to-raise.html

John Paulson Hewlett-Packard

John Paulson Hewlett-Packard

John Paulson Buys $1 Billion in Shares of Hewlett-Packard

Hedge fund manager John Paulson has made a big investment in Hewlett-Packard Co. The hedge fund titan who made a name for himself by betting against the housing market before the financial crisis has bought a $1 billion stake in HP. This purchase amounted to about 25 million shares of the company's stock.
Paulson bought 25 million shares in Hewlett-Packard, valued at about $1 billion, according to a regulatory filing yesterday. The New York-based fund added 17.3 million shares of Transocean, lifting its stake to 7.7 percent and making Paulson the largest holder of the Vernier, Switzerland-based offshore driller.

The hedge fund has said it expects to make money in the next two years with the stocks of companies going through bankruptcy, restructuring or reorganization. Transocean, the owner and operator of the Deepwater Horizon drilling rig that exploded a year ago, was sued by BP Plc last month for billions of dollars in damages related to the oil spill. Hewlett-Packard is pushing deeper into software to try to reverse a 22 percent drop in its shares in the past year.

Leo Apotheker, who took over as Hewlett-Packard’s chief executive officer Nov. 1, outlined his strategy for the first time on March 14. The company is starting a cloud-computing service that will let developers create applications for consumers and businesses that run on HP servers, Apotheker said at the time. Source

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Hedge Funds Sell Gold

Hedge Funds Sell Gold

Hedge Funds, Soros Sell Off Gold Holdings

Hedge funds and investor George Soros's fund combined to push down the price of gold. The funds recently disclosed that they had cut their gold positions.  Many hedge funds have been riding the wave of high gold prices through investments in gold trusts.
Gold for May delivery settled down $10.60, or 0.7%, at $1,479.80 a troy ounce on the Comex division of the New York Mercantile Exchange. The most actively traded gold contract, for June delivery, ended down $10.60, or 0.7%, at $1,480.00 a troy ounce.

Soros Fund Management said late Monday in a securities filing that it sold 99% of its stake, or 4.7 million shares, in exchange-traded fund SPDR Gold Trust (GLD) in the first quarter.

The shares sold were worth $680 million based on Monday's prices. However, gold prices averaged slightly less in the first quarter, so Soros's take could have been smaller.

As of March 31, Soros held just 49,400 shares valued at $6.9 million of the fund, which is backed by physical gold.

The news sapped confidence among gold investors because Soros had led the charge on gold over the past two years, aggressively purchasing the precious metal even after calling it "the ultimate asset bubble." Source

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Goldman Sachs Hedge Funds

Goldman Sachs Hedge Funds

Goldman Sachs Reportedly Looking to Seed Hedge Funds

Goldman Sachs is making another step into the hedge fund industry by bankrolling a few hedge funds. The bank is reportedly trying to compete with Blackstone Group LP in seeding hedge funds. For the last year Goldman has been trying to seed more hedge funds after shutting a fund that year.
The bank has spent the past year trying to attract clients for a seeding fund, which provides managers with startup investing capital in exchange for a cut of their fees, said the people, who asked not to be identified because the effort is private. Blackstone recently raised $2.4 billion for its second seeding fund, the industry's biggest.

Reservoir Capital Group, Larch Lane Advisors LLC and PineBridge Investments LLC also are marketing new funds, saying it's a good time to back startups because after the financial crisis investors are reluctant to trust even talented traders going out on their own. Goldman Sachs shut a fund in 2008, underscoring that betting on new managers can be tricky even for one of Wall Street's savviest firms.

"Seeding isn't an easy-money business," said Alexis Graham, co-founder of Acceleration Capital Group, which works with seed investors. "There are only a small percentage of people out there who can consistently outperform, build a business and scale assets."

About half of the 100 or so firms that financed startups before 2008 have curtailed their investing or quit the industry, Graham said. Reasons for the shakeout include poor manager selection and hard-to-navigate financial markets. Source


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http://richard-wilson.blogspot.com/2011/05/goldman-sachs-hedge-funds.html

Hedge Funds 40 Under 40

Hedge Funds 40 Under 40

Financial News Releases Latest 40 Under 40 Rising Stars

Financial News has released its annual ranking of young up-and-coming hedge fund professionals, the FN 40 Under 40 Rising Stars. A new generation of hedge fund managers has emerged in the wake of the recession and recovery.
The 40 listed here say they have learnt lessons from the financial crisis and many are applying them to new ventures. Fifteen of the 40 have taken advantage of an improved environment for start-ups by striking out on their own and launching new funds, although fundraising is still tough.

This list is not confined to money managers; it includes individuals from the operational and strategic side of the business, marketers, fundraisers, investors, consultants, researchers, prime brokers and even a lawyer.

The list reflects the industry’s shift towards lobbying regulators and preparing for rule changes, including the winding down of banks’ proprietary trading businesses to comply with the Volcker rule. See the list.

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Hedge Funds Investment Banks

Hedge Funds Investment Banks

Top Hedge Funds Get a Peek from Investment Banks

Investment banks are increasing their efforts to attract hedge fund clients, but one practice may draw the ire of regulators and some banks. The practice of giving top hedge fund clients select access to senior deal makers and corporate executives is not new but it is now attracting attention from lawmakers and others.
The lunch meeting casts a spotlight on a practice that has long occurred in the shadows of Wall Street and the City of London—but which is now causing concern among regulators and some banks.

Investment banks vie for business from elite hedge funds by offering traders at those funds special access to senior deal makers and corporate executives at dinners and other gatherings. The traders sometimes pick up valuable nuggets of information that aren't available to other investors, according to people who have attended such gatherings.

The meetings are held by many of the world's largest investment banks for their hedge-fund clients. The funds are prized clients because they collectively pay billions of dollars in fees each year for buying and selling stocks. Banks including Bank of America Corp., Barclays PLC, Citigroup Inc., Credit Suisse Group AG, J.P. Morgan, Morgan Stanley, UBS AG and Scotiabank host the gatherings, generally several times a year or more, according to traders, bankers and brokers. Source

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Raj Rajaratnam Guilty

Raj Rajaratnam Guilty

Rajaratnam Found Guilty of Fraud and Conspiracy

A federal jury found hedge fund manager Raj Rajaratnam guilty on all 14 counts against him. The Galleon Group founder was initially charged as part of the federal crackdown on insider trading in the financial industry. Now, Mr. Rajaratnam could face as many as 19 and a half years in prison. He will be sentenced on July 29th.

After deliberating for over two weeks, a federal jury in Manhattan convicted Mr. Rajaratnam of all14 counts he faced. He could face as much as 19 and a half years in prison under federal sentencing guidelines. He is to be sentenced on July 29.
Mr. Rajaratnam was charged in October 2009 and became the hub of what developed into a sprawling, multiyear investigation. The Justice Department and the Securities and Exchange Commission accused Mr. Rajaratnam and five others of relying on a vast network of company insiders and consultants to make tens of millions in profits.
During the course of the case, 21 defendants pleaded guilty, including former executives at I.B.M., Intel and Bear Stearns.
The government built its case against Mr. Rajaratnam with powerful wiretap evidence. Over a nine-month stretch in 2008, federal agents secretly recorded Mr. Rajaratnam’s telephone conversations. They listened in as Mr. Rajaratnam brazenly and matter-of-factly swapped inside stock tips with corporate insiders and fellow traders.  Source


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Singapore Hedge Fund

Singapore Hedge Fund

Singapore Working to Attract More Hedge Funds

Singapore is trying to lure more and more hedge funds to the country and it is becoming increasingly easy to work there. Many hedge funds are attracted to the huge growth and potential returns in Asia. Singapore is working hard to develop its financial industry in a way that welcomes hedge funds and other alternative investors.
Singapore is attracting more global hedge funds that are drawn to Asia’s economic growth as the regulator seeks to further develop the industry, including building up fund administration services.

“We continue to see interest from fund managers as well as alternative investment managers, including global and indigenous hedge funds, which add diversity to the broader asset management industry,” Ng Nam Sin, assistant managing director of the Monetary Authority of Singapore, wrote in an e-mailed response to questions.

Global managers including Fortress Investment Group LLC and Algebris Investments LLP have set up in Singapore as Asia’s economic growth outpaces the world. The region now has as many millionaires as Europe and they are set to increase allocations to alternative investments, including hedge funds, to 8 percent of their portfolios this year, from 5 percent in 2009, according to a Capgemini SA and Merrill Lynch & Co. report.

“Asia is a region which has and continues to attract significant capital, and hedge funds will follow the movement of capital globally,” said Tim Rainsford, the Hong Kong-based managing director of Man Investments in Asia. Source

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Tags: Singapore Hedge Fund, Singapore Hedge Funds, Singapore Hedge Fund Industry, Singapore Hedge Fund Returns, Asia Hedge Fund, Asian Hedge Funds

Link to This Resource: Singapore Hedge Fund

http://richard-wilson.blogspot.com/2011/05/singapore-hedge-fund.html

Hedge Funds Insurance

Hedge Funds Insurance

Study Finds Larger Hedge Funds Buy More Insurance

A new study was conducted on how hedge funds purchase insurance and how much they are paying for it. The findings show that larger hedge funds $10 billion or more AUM tend to purchase more insurance than smaller hedge funds. Furthermore, large hedge funds pay less for their insurance than smaller funds.
The study of 250 hedge fund insurance purchases shows large hedge funds typically purchase $40 million or more in professional liability insurance coverage, nearly 200% more than medium-sized funds.

SKCG says that, dollar for dollar, the bigger funds pay less for their coverage. It also says that strengthened regulation and “heightened investor expectations” make it impractical for larger funds to pay out of pocket for the costs of trading errors, investor and SEC lawsuits, and investigations.

“Before the financial crisis, it wasn’t uncommon for large hedge funds to just eat the costs of investigations and lawsuits resulting from trading errors and other mistakes. This simply doesn’t make sense anymore when the price of insurance against these costs has declined by as much as 20% in the last two years and is even more inexpensive to the largest funds who buy higher limits,” said Wayne Siebner, senior vice president and manager of executive and professional kiability for SKCG Group. Source

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Cohen Account

Cohen Account

Cohen Account Examined by U.S. Prosecutors in Court Case

Federal prosecutors are looking into trades made in an account overseen by mega hedge fund manager Steven Cohen that to him were suggested by two of his former fund managers.  The two former employees have pleaded guilty to insider trading and now, according to court filings, the prosecution has focused on the "Cohen Account," the personal portfolio account for Mr. Cohen at SAC Capital Advisors. 
The development surfaced in court filings submitted in connection with a sweeping insider-trading investigation, which focuses on ways traders can receive nonpublic information from experts connected to industries or firms.

At issue is trading in a $3 billion stock portfolio personally overseen by Mr. Cohen at SAC Capital Advisors and referred to by the government in the filings as the "Cohen Account" and internally at SAC as "The Big Book."

SAC portfolio managers funnel their best trading ideas to Mr. Cohen for this account and are paid a bonus if they generate big returns for Mr. Cohen, according to people familiar with the matter.  Source

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Trends Asian Hedge Funds

Trends Asian Hedge Funds

Emerging Trends in Asian Hedge Funds

Tanuj Khosla of 3 Degrees Asset Management has contributed an interesting article to Business Insider. Khosla outlines the current emerging trends for Asian hedge funds. He gives a nice overview of Asian hedge funds and points out the major changes in Asian hedge funds.
If somebody ever wrote a book titled ‘History of hedge funds in Asia’ in 2030, I can bet every dollar in my pocket that he (or she) shall refer to 2010 & 2011 as the defining years in the evolution of the industry in this part of the world.

Or let us say that hypothetically there was a hedge fund manager with over a decade of experience in fund management who closed down his hedge fund in Asia in 2009 and shifted to Antarctica. If he returns today to start another hedge fund in Asia, he would be faced with totally altered dynamics and shall be as lost as a new trader starting out. The irreversible trends that have emerged in Asian hedge funds over the last few months are expected to completely change the industry landscape in the years to come.

INDUSTRY OVERVIEW
According to some estimates, there are around 1300 Asia-focused hedge funds in the world today with around US$ 125 billion assets under management (AUM). That makes the average size of an Asia-focused hedge fund close to US$ 96 million which is less than half the size of an average hedge fund in the U.S. Read more


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Hedge Fund Index April

Hedge Fund Index April

Hennessee Hedge Fund Index Increases 1.3% in April

A hedge fund index shows that hedge funds had an okay April, returning 1.3%. Equities still outperformed hedge funds pretty handily. The S&P 500 grew 2.9% and the Dow Jones climbed 3.98%. The Nasdaq Composite index increased by 3.32% in April. Blue chips in the US had a much better month, in fact their best of the year.
Hedge funds posted gains in April but trailed the major stock indexes during a strong month for equities, according to hedge fund adviser Hennessee Group.

Hennessee Group co-founder Charles Gradante said "the investment environment remains challenging" for the generation of active returns, and shorting--betting on declining values--has been particularly tricky, detracting from overall performance.

U.S. blue-chip stocks saw their best month of the year in April, as first-quarter earnings reports sent major indexes to fresh highs at the end of the month.

Meanwhile, the Barclays Aggregate Bond Index rose 1.27% and the Barclays High Yield Credit Bond Index increased 1.55%. Source



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European Pension Funds

European Pension Funds

European Pension Funds Reduce Allocations to Hedge Funds

European pension funds are pulling back money from the hedge fund industry. Even though hedge funds around the globe are raking in the cash, European pension funds are scaling back from allocations to 1.3% from 3.1% the year before. The findings come from a Mercer Investment Consulting survey that found the decline among European pension funds.
European pension funds apparently aren't as psyched up about investing in hedge funds as their American counterparts. A survey conducted by Mercer Investment Consulting points out the number of plans looking to beef up strategic allocations to hedge funds in 2011 has fallen to 1.3 percent from 3.1 percent a year ago.

This is in stark contrast to results of a survey released last month by publishing and research group Infovest21, which found that large U.S. hedge funds are increasing their direct allocations to hedge funds. According to Mercer, the total number of European pension funds looking to increase their investments in funds of hedge funds has fallen to 4.8 percent from 6.5 percent a year ago.

The study, based on data culled from more than 1,100 pension plans with more than $815 billion in assets, found that as inflation concerns mount, European investors have increasingly mixed feelings about the illiquid nature of hedge fund investments, even as their demand for alternative assets climbs. Source

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Och-Ziff Hedge Funds

Och-Ziff Hedge Funds

Och-Ziff Funds Attract Capital, Make Small Gains

Investors are giving one hedge fund management firm a big vote of confidence, despite meager gains produced by the firm's big hedge funds. Och-Ziff's bigger hedge funds have been raking in the cash from investors but the hedge funds have only produced relatively small gains.
Billionaire Daniel Och’s most important hedge funds continue to eke out relatively small gains in 2011, but that has not stopped investors from flocking to one of the world’s biggest hedge fund managers.
Och-Ziff Capital Management has experienced inflows of $400 million in 2011 and the firm is now managing $29.4 billion of assets, according to its first-quarter earnings filing with the Securities & Exchange Commission. But Och’s main hedge funds trailed the total return of the Standard & Poor’s 500 index, which had a total return of 9.06% in the first four months of 2011.
The Oz Master Fund posted a 0.69% return in April and a year-to-date return of 4.08%, according to the SEC filing Och-Ziff Capital Management made on Tuesday.
The Oz Europe Master Fund returned 0.39% in April and 3.98% so far in 2011; the Oz Asia Master Fund returned 0.89% in April and 2.36% year-to-date; and the Oz Global Special Investments Master Fund returned 0.87% and 5.53% so far in 2011.  Source

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Silver Hedge Funds

Silver Hedge Funds

Price of Silver Falls, Some Hedge Funds Hurt by Decline

Following up on yesterday's article reporting on how hedge funds remained bullish on silver. Now, hedge funds are feeling the sting as the price of silver has dropped dramatically in the last few days.
Silver was above $50 just a couple of days ago. Not anymore. iShares Silver Trust (SLV) lost nearly $8 per share during the last couple of days. Business Insider listed Charles Davidson’s Wexford Capital as one of the biggest holders of SLV at the end of December. Wexford had 841 thousand shares of SLV. They also had call options on 200 thousand shares. The value of their holdings is worth more than $40 Million today. There are other hedge funds with bigger SLV holdings though.

Peter J. Eichler’s Alethia Research had more than 4.8 Million shares of SLV. Alethia lost more than $38 Million in just two days. But don’t feel sorry for them, they made more than $40 Million since the end of 2010.

Richard Chilton’s Chilton Investment Company had more than 3.3 Million shares of SLV. Chilton lost more than $25 Million during the past couple of days.

Finally Jean-Marie Eveillard’s First Eagle had 1,350,000 shares of SLV. First Eagle’s loss is around $10.8 Million, which is 30% more than Wexford’s. Source


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Hedge Funds Silver

Hedge Funds Silver

Hedge Funds Bullish on Emerging Markets, Silver

Hedge funds are crowding into the emerging markets, where investors expect there to be a lot of volatility. Hedge funds also remain bullish on silver according to a research report by Bank of America Merrill Lynch.
The rekindled bullishness about emerging markets comes on the heels of a sharp correction in these developing countries at the beginning of the year. Emerging markets shares have recovered since, though these formerly hot investments are still lagging their developed-country counterparts.

Diversified emerging-markets retail mutual funds, for example, advanced 4.2% on average so far this year through April 29 — posting less than half of the Standard & Poor’s 500-stock index’s 9% gain, according to investment researcher Morningstar Inc. Latin America funds have been the worst of the group, rising just 0.8% on average.

Typically investors do well to follow the moves of the big-money hedge funds. “Generally they find a trade and stay with the trade,” Bartels said.

But the trading action creates short-term volatility, which can test investors’ mettle. Source

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