Hedge fund affiliate, Citadel Solutions, today announced a partnership with Bloomberg to provide hedge fund administrative services through the Bloomberg terminals used by traders.
With more than $30 billion in assets under administration, Citadel said the package will diversify their revenue. Citadel described the product as a "hedge fund in a box."
John Buckley, President of Citadel Solutions, said, "We've greatly simplified the set-up of managing a hedge fund, allowing our clients to focus on what they do best, trading, and not focus on administration."
Launched in 2007, Citadel Solutions is an affiliate of Chicago-based hedge fund Citadel Investment Group, they provide technology-driven fund administration and
reporting services to hedge funds.
28 Feb 2008
Financialization of America
DUMMERSTON, Vt. -- It seems hard to believe, but the finance, insurance and real estate sector (FIRE, for short) now constitutes about 20 percent of our nation's gross domestic product, while manufacturing contributes less than 13 percent. By comparison, in 1950, manufacturing was 29.3 percent of GDP and financial services contributed 10.9 percent.
In other words, more money is made today by shifting money around than in making things. And the FIRE sector no longer represents a group of institutions designed to raise capital for investment in productive activities; it is wealth generated from activities that contribute little to the actual economy.
Conservative writer Kevin Phillips calls it "financialization," or the process by which the FIRE sector assumes the dominant economic, cultural and political role in a national economy.
For example, energy prices. Last summer, commodities traders bid up the price of oil to $78 per barrel last summer on fears of more unrest in the Middle East after the Israel/Hezbollah dustup and another season of severe hurricanes. Neither thing happened, and oil prices slid down to about $50 per barrel by the end of 2006. Fear-based speculation drove up oil prices, and reality drove them back down.
If you invested in oil futures and got out at the top of the market, you made money. But what did it contribute to the larger economy? The rest of us paid more than we needed to for most of 2006 for heating oil, propane and gasoline, based on a possibility that some disruption of petroleum supplies might happen. That's what you get when the financial sector is totally divorced from reality.
Now, oil prices have crept back up to that level this summer, without an suitable alibi such as a hurricane or a war to justify $78 a barrel oil. Who is profiting and does this profit provide an good for the economy at large?
An equally good question is the long-term viability of an economy based on shuffling around financial assets.
It's hard to say whether the sharp swings in the stock market over the past week has been just a minor correction in stock values or the start of what could be a bigger problem.
The Dow Jones Industrial Average went all the way up to 14,000 on July 19 based on the hope that the collapse of the subprime lending market would not have an effect on the larger economy and that higher energy prices would not have an effect on consumer spending.
The reality, however, is that as much as $2.5 trillion could be at risk in bad mortgages and the frenzy of mergers and leveraged buyouts of companies fueled by borrowed money.
According recent figures from Moody's, the bond rating firm, nearly 20 percent of all mortgage debt is at risk, or about $2.5 trillion of subprime mortgages. About $1.4 trillion is at high risk of default, as many as 2.5 million mortgages will default in the next two years and about 20 percent of subprime loans written in the last half of 2006 will default. Investor losses could run into hundreds of billions of dollars.
On July 26, a record 10.59 billion shares changed hands on the three major U.S, markets. Several big deals - from Chrysler to Tyco Electronics - have been postponed in the last couple of weeks because of rapidly tightening credit. There's an estimated backlog of more than $300 billion in unsold bonds and bank loans. That's almost as big as the backlog of unsold homes in the United States right now, as housing inventories in some part of the country are at levels not seen in decades.
The implosion of the subprime mortgage market, where people with little or no savings took huge mortgages with little or no money down, has been well documented. While it was inevitable that money lent to people without the means to pay it back would lead to a massive number of defaults and foreclosures, the investors who fueled this market never seemed to think that all those risky loans might go bad at all once.
It's truly amazing to see how deeply Wall Street has been involved in what's known as collateralized debt obligations (CDO), or the bundling of mortgages, home equity loans, car loans and credit card debt by hedge funds.
A major Wall Street investment house, Bear Stearns, saw about $10 billion of value disappear from two of its CDO hedge funds last month, and the market barely blinked an eye. But once other investment houses came to the realization that they are holding hundreds of billions of dollars of bad loans that they are now unable to sell to other investors, they started to realize that you can only ignore reality for so long before it comes back to bite you - hard.
Mortgage lenders stopped caring if borrowers were qualified. Bankers stopped caring if borrowers couldn't repay loans. And all these bad loans got repackaged and resold to other investors - all gussied up so that you'd never know that you were buying into funds based on assets that didn't exist.
This has been the state of our financial markets over the past few years. Greed has seemingly blinded people to fundamental economic principles, and the transfer of more of this nation's wealth into the hands of fewer and fewer people is celebrated as capitalism's highest achievement.
The total net worth of American households climbed to $54.1 trillion last year, or more than $3 trillion higher than it was in 2005, and tax revenues managed to increase despite lower rates on wealthy Americans. Meanwhile, over the past five years, inflation-adjusted weekly wages for workers have been up about 0.5 percent per year.
Unfortunately, the people who have profited from wrecking the American economy will walk away with bulging pockets and seemingly clear consciences. The rest of us will be stuck with cleaning up when every comes tumbling down.
Randolph T. Holhut has been a journalist in New England for more than 25 years. He edited "The George Seldes Reader" (Barricade Books). He can be reached at randyholhut@yahoo.com.
On Native Ground
THE FINANCIALIZATION OF AMERICA
by Randolph T. Holhut
American Reporter Correspondent
Dummerston, Vt.
In other words, more money is made today by shifting money around than in making things. And the FIRE sector no longer represents a group of institutions designed to raise capital for investment in productive activities; it is wealth generated from activities that contribute little to the actual economy.
Conservative writer Kevin Phillips calls it "financialization," or the process by which the FIRE sector assumes the dominant economic, cultural and political role in a national economy.
For example, energy prices. Last summer, commodities traders bid up the price of oil to $78 per barrel last summer on fears of more unrest in the Middle East after the Israel/Hezbollah dustup and another season of severe hurricanes. Neither thing happened, and oil prices slid down to about $50 per barrel by the end of 2006. Fear-based speculation drove up oil prices, and reality drove them back down.
If you invested in oil futures and got out at the top of the market, you made money. But what did it contribute to the larger economy? The rest of us paid more than we needed to for most of 2006 for heating oil, propane and gasoline, based on a possibility that some disruption of petroleum supplies might happen. That's what you get when the financial sector is totally divorced from reality.
Now, oil prices have crept back up to that level this summer, without an suitable alibi such as a hurricane or a war to justify $78 a barrel oil. Who is profiting and does this profit provide an good for the economy at large?
An equally good question is the long-term viability of an economy based on shuffling around financial assets.
It's hard to say whether the sharp swings in the stock market over the past week has been just a minor correction in stock values or the start of what could be a bigger problem.
The Dow Jones Industrial Average went all the way up to 14,000 on July 19 based on the hope that the collapse of the subprime lending market would not have an effect on the larger economy and that higher energy prices would not have an effect on consumer spending.
The reality, however, is that as much as $2.5 trillion could be at risk in bad mortgages and the frenzy of mergers and leveraged buyouts of companies fueled by borrowed money.
According recent figures from Moody's, the bond rating firm, nearly 20 percent of all mortgage debt is at risk, or about $2.5 trillion of subprime mortgages. About $1.4 trillion is at high risk of default, as many as 2.5 million mortgages will default in the next two years and about 20 percent of subprime loans written in the last half of 2006 will default. Investor losses could run into hundreds of billions of dollars.
On July 26, a record 10.59 billion shares changed hands on the three major U.S, markets. Several big deals - from Chrysler to Tyco Electronics - have been postponed in the last couple of weeks because of rapidly tightening credit. There's an estimated backlog of more than $300 billion in unsold bonds and bank loans. That's almost as big as the backlog of unsold homes in the United States right now, as housing inventories in some part of the country are at levels not seen in decades.
The implosion of the subprime mortgage market, where people with little or no savings took huge mortgages with little or no money down, has been well documented. While it was inevitable that money lent to people without the means to pay it back would lead to a massive number of defaults and foreclosures, the investors who fueled this market never seemed to think that all those risky loans might go bad at all once.
It's truly amazing to see how deeply Wall Street has been involved in what's known as collateralized debt obligations (CDO), or the bundling of mortgages, home equity loans, car loans and credit card debt by hedge funds.
A major Wall Street investment house, Bear Stearns, saw about $10 billion of value disappear from two of its CDO hedge funds last month, and the market barely blinked an eye. But once other investment houses came to the realization that they are holding hundreds of billions of dollars of bad loans that they are now unable to sell to other investors, they started to realize that you can only ignore reality for so long before it comes back to bite you - hard.
Mortgage lenders stopped caring if borrowers were qualified. Bankers stopped caring if borrowers couldn't repay loans. And all these bad loans got repackaged and resold to other investors - all gussied up so that you'd never know that you were buying into funds based on assets that didn't exist.
This has been the state of our financial markets over the past few years. Greed has seemingly blinded people to fundamental economic principles, and the transfer of more of this nation's wealth into the hands of fewer and fewer people is celebrated as capitalism's highest achievement.
The total net worth of American households climbed to $54.1 trillion last year, or more than $3 trillion higher than it was in 2005, and tax revenues managed to increase despite lower rates on wealthy Americans. Meanwhile, over the past five years, inflation-adjusted weekly wages for workers have been up about 0.5 percent per year.
Unfortunately, the people who have profited from wrecking the American economy will walk away with bulging pockets and seemingly clear consciences. The rest of us will be stuck with cleaning up when every comes tumbling down.
Randolph T. Holhut has been a journalist in New England for more than 25 years. He edited "The George Seldes Reader" (Barricade Books). He can be reached at randyholhut@yahoo.com.
On Native Ground
THE FINANCIALIZATION OF AMERICA
by Randolph T. Holhut
American Reporter Correspondent
Dummerston, Vt.
Individual Outperforms Hedge Funds at Competition
Haochen Hu, a seasoned investor from Hong Kong, won this year's World TopInvestor competition with gains of almost 785% over 12 months.
He outperformed the world's leading hedge funds with gains of almost 785% over the competition period. The competition is a live, real money, capital markets trading competition lasting for a full year. The prize for the top investor is the management of a fund with an investment value of $250,000 sponsored by Saxo Bank, a global leader in online trading and investment services.
The winner of the 2007-08 competition was Haochen Hu, who led a strong field including Guo Hanqui with a net gain of 630%, Julian Szkirpan from the United States with 555% as well as Hungarian investors György Doleschall with a 315% gain and Tamás Czajner with 135%.
"Losing money is bad, but it is much worse when you don't know why you lost. I have traded online for eight years and you must study and be familiar with the product you want to invest in. My strategy was simple. I focused on currency trading and used the higher leverage when I felt the chance was there," commented Hu.
Next year's World TopInvestor Competition is open to all entrants willing to open an account with any Broker sponsor. Among this year's sponsors of the World TopInvestor competition were several leading online investment banks and brokers from all over the world including: Saxo Bank, Commodity Broking Services, BenchMark Finance, Cambiste, Finexo, Buda-Cash Brókerház, TMS Brokers, Banco Best, Poteza BPD, Dif Broker and RCG FX Trader.
He outperformed the world's leading hedge funds with gains of almost 785% over the competition period. The competition is a live, real money, capital markets trading competition lasting for a full year. The prize for the top investor is the management of a fund with an investment value of $250,000 sponsored by Saxo Bank, a global leader in online trading and investment services.
The winner of the 2007-08 competition was Haochen Hu, who led a strong field including Guo Hanqui with a net gain of 630%, Julian Szkirpan from the United States with 555% as well as Hungarian investors György Doleschall with a 315% gain and Tamás Czajner with 135%.
"Losing money is bad, but it is much worse when you don't know why you lost. I have traded online for eight years and you must study and be familiar with the product you want to invest in. My strategy was simple. I focused on currency trading and used the higher leverage when I felt the chance was there," commented Hu.
Next year's World TopInvestor Competition is open to all entrants willing to open an account with any Broker sponsor. Among this year's sponsors of the World TopInvestor competition were several leading online investment banks and brokers from all over the world including: Saxo Bank, Commodity Broking Services, BenchMark Finance, Cambiste, Finexo, Buda-Cash Brókerház, TMS Brokers, Banco Best, Poteza BPD, Dif Broker and RCG FX Trader.
AdultVest Launches Alternative Investment Series Of Meetings
Alternative investment firm AdultVest has scheduled an ongoing series of monthly meetings to bring investors together with adult businesses that represent alternative investment opportunities.
On the last Wednesday of each month, AdultVest executives will listen to presentations from adult business owners, and the following day the most well-prepared companies with the best opportunities will be presented in person to investors at the investor meeting.
According to AdultVest CEO Francis Koenig, he and his team will meet tommorow, at the first of these monthly meetings, with about 20 adult companies to assess the viability of the investment opportunities presented to them. The following day, 10-15 vetted investors will attend.
"The meetings are geared to bring investors and companies together," he said. "During the meetings, deals will be passed around the table and we will all discuss the various levels of interest in the deals presented. In certain circumstances, if we feel they are ready, we will invite company CEOs to make their own presentations."
"We're specifically looking for Internet companies and gentlemen's clubs with minimum annual revenue exceeding $1 million. There really are no limitations as to deal size on the higher end of the spectrum."
AdultVest investor meeting attendees will include private equity, hedge fund, venture capital and angel investment fund managers, as well as individual investors, investment bankers, financial advisors, and the AdultVest investment committee in charge of managing the AdultVest Bacchus Investment Fund and Priapus Investment Fund.
According to AdultVest.com Marketplace Statistics recently added to the AdultVest website, 647 adult companies have submitted investment proposals to the company, with 3380 vetted investors in the pool of interested parties. There have also been 1833 due diligence requests made by potential investors.
On the last Wednesday of each month, AdultVest executives will listen to presentations from adult business owners, and the following day the most well-prepared companies with the best opportunities will be presented in person to investors at the investor meeting.
According to AdultVest CEO Francis Koenig, he and his team will meet tommorow, at the first of these monthly meetings, with about 20 adult companies to assess the viability of the investment opportunities presented to them. The following day, 10-15 vetted investors will attend.
"The meetings are geared to bring investors and companies together," he said. "During the meetings, deals will be passed around the table and we will all discuss the various levels of interest in the deals presented. In certain circumstances, if we feel they are ready, we will invite company CEOs to make their own presentations."
"We're specifically looking for Internet companies and gentlemen's clubs with minimum annual revenue exceeding $1 million. There really are no limitations as to deal size on the higher end of the spectrum."
AdultVest investor meeting attendees will include private equity, hedge fund, venture capital and angel investment fund managers, as well as individual investors, investment bankers, financial advisors, and the AdultVest investment committee in charge of managing the AdultVest Bacchus Investment Fund and Priapus Investment Fund.
According to AdultVest.com Marketplace Statistics recently added to the AdultVest website, 647 adult companies have submitted investment proposals to the company, with 3380 vetted investors in the pool of interested parties. There have also been 1833 due diligence requests made by potential investors.
27 Feb 2008
Hedge Fund Opens Office In New York, New Launch
Canadian Hedge fund Lionhart Ltd. this month announced the launch of a new fund and the opening of an office in midtown Manhattan, New York. Present in the US since 2000, the addition of the New York office positions the hedge fund to develop the U.S. markets.
The launch of Talon, a private equity hybrid fund, is scheduled for March 2008. With a minimum investment of $1 million, the new hedge fund will be set up with $50 million from Lionhart and $50 million from existing and new investors from the US, Middle East and Europe.
Lionhart said, "Talon will be investing into early stage private financings and placements across a number of sectors including minerals, mining and natural resources, energy, alternative energies, mezzanine and bridge financing, IT and medical technology, property development and sub-sectors of these main areas. Investors will have the opportunity to invest in a blend of all the sectors or in an individual sector."
CEO Terrence Duffy, commenting on the move, said, "Information flow for traders and convenience for investors will improve with this move to Manhattan. This makes a lot of sense given the direction Lionhart is moving and the understandable interest in our fund offerings."
Lionhart is a multi-strategy arbitrage hedge fund with $800 million under management. Lionhart's New York office will open with 11 staff including trading, research, investor relations, and administrative functions. The Toronto-based hedge fund has offices in the world's top financial centers now including New York, Toronto, London and Singapore.
The launch of Talon, a private equity hybrid fund, is scheduled for March 2008. With a minimum investment of $1 million, the new hedge fund will be set up with $50 million from Lionhart and $50 million from existing and new investors from the US, Middle East and Europe.
Lionhart said, "Talon will be investing into early stage private financings and placements across a number of sectors including minerals, mining and natural resources, energy, alternative energies, mezzanine and bridge financing, IT and medical technology, property development and sub-sectors of these main areas. Investors will have the opportunity to invest in a blend of all the sectors or in an individual sector."
CEO Terrence Duffy, commenting on the move, said, "Information flow for traders and convenience for investors will improve with this move to Manhattan. This makes a lot of sense given the direction Lionhart is moving and the understandable interest in our fund offerings."
Lionhart is a multi-strategy arbitrage hedge fund with $800 million under management. Lionhart's New York office will open with 11 staff including trading, research, investor relations, and administrative functions. The Toronto-based hedge fund has offices in the world's top financial centers now including New York, Toronto, London and Singapore.
Study On Synthetic Hedge Fund Indices
Synthetic hedge fund indices (SHFIs), also known as 'hedge fund clones' were introduced in 2007, following years of academic research. SHFIs are dynamically managed portfolios of liquid assets (also called replicating factors, which usually exist in futures and exchange-traded funds) that aim at minimising the tracking error with a target non-investable hedge fund index.
Based on research by Innocap Investment Management's, there are four criteria which should be met by SHFIs; they should be representative of the investment universe, transparent, have consistent weighting, timely reporting, stable performance over time, and they should be investable.
SHFIs are to hedge funds what exhange traded funds (ETFs) are to mutual funds, a liquid, low-cost and transparent way to expose a portfolio to the asset class. SHFIs that target a good hedge fund index and use a sophisticated tracking model applied to a wide range of liquid and transparent financial instruments should exhibit an interesting risk-return profile, particularly for the liquidity risk conscious investors.
SHFIs currently constitute a small portion of all hedge fund assets under management because they have been introduced quite recently. Nevertheless, they now constitute a key element in the alternative assets offering of the biggest financial institutions.
Innocap Investment Management is a subsidiary of the National Bank of Canada [TSX: NA-T], it was created to supervise all of the bank's alternative investments activities in capital markets.
Based on research by Innocap Investment Management's, there are four criteria which should be met by SHFIs; they should be representative of the investment universe, transparent, have consistent weighting, timely reporting, stable performance over time, and they should be investable.
SHFIs are to hedge funds what exhange traded funds (ETFs) are to mutual funds, a liquid, low-cost and transparent way to expose a portfolio to the asset class. SHFIs that target a good hedge fund index and use a sophisticated tracking model applied to a wide range of liquid and transparent financial instruments should exhibit an interesting risk-return profile, particularly for the liquidity risk conscious investors.
SHFIs currently constitute a small portion of all hedge fund assets under management because they have been introduced quite recently. Nevertheless, they now constitute a key element in the alternative assets offering of the biggest financial institutions.
Innocap Investment Management is a subsidiary of the National Bank of Canada [TSX: NA-T], it was created to supervise all of the bank's alternative investments activities in capital markets.
25 Feb 2008
New York Hedge Fund Spends $27 Million On Alvarion
After buying a $27 million stake in Alvarion, New York-based hedge fund Renaissance Technologies Corporation has become a party at interest with 5.76% of the company.
With a market cap of $480 million, Israeli company Alvarion provides WiMAX broadband communications technology, they posted $236.6 million in revenue for 2007.
Alvarion said in a document filed with the US Securities and Exchange Commission that the transaction was made on November 8, 2007. Renaissance Technologies is now the largest shareholder in Alvarion, which until now did not have a shareholder owning more than 5%, the threshold of a party at interest under Israeli law.
Renaissance Technologies was founded in 1982 by cryptanalyst James Harris Simons and is now one of the world’s largest hedge funds. The hedge fund uses statistical and mathematical models to make its investments. It has more than $12 billion under management.
With a market cap of $480 million, Israeli company Alvarion provides WiMAX broadband communications technology, they posted $236.6 million in revenue for 2007.
Alvarion said in a document filed with the US Securities and Exchange Commission that the transaction was made on November 8, 2007. Renaissance Technologies is now the largest shareholder in Alvarion, which until now did not have a shareholder owning more than 5%, the threshold of a party at interest under Israeli law.
Renaissance Technologies was founded in 1982 by cryptanalyst James Harris Simons and is now one of the world’s largest hedge funds. The hedge fund uses statistical and mathematical models to make its investments. It has more than $12 billion under management.
UAE and Qatar Hedge Fund Boom
According to research conducted by banking group Mirabaud, the Middle East is set to become increasingly active in the global hedge fund industry. The report also said that the UAE and Qatar could potentially be playing dominant roles in the region.
Mirabaud forecasts that hedge funds will become increasingly attractive to the region’s ever-more sophisticated regional investors, especially given the high levels of excess liquidity in the Middle East.
CEO Gilles Rollet said, "Globally, hedge fund centres have emerged from the most sophisticated financial centres, such as New York, London, Hong Kong and Singapore. The relevant defining attribute of each of these locations is the maturity of their capital markets….The Dubai International Financial Centre has even taken the step, through its regulating body the Dubai Financial Services Authority, to create a Hedge Fund Code of Practice, giving legal weight to the effort to make Dubai a centre in the hedge fund industry."
Increased institutional investment in the regional capital markets, especially the UAE, is another sign of the maturity of markets here, Mirabaud’s research found. Globally, at a time when most traditional investments are generating low levels of returns, institutional investors are increasingly attracted to alternative asset classes such as hedge funds.
"A hedge fund-friendly environment can be seen to emerge from a region with high levels of excess liquidity and strong degrees of professionalism among regulators and service providers. The Middle East is well known for its access to enormous amounts of excess liquidity due to the high price of oil. In the UAE and Qatar, we are now seeing professionalism from both regulators and service providers grow steadily. Both countries have governments that are committed to forging legal structures that allow for increasing financial sophistication in their respective financial districts. If current trends continue, these two countries will undoubtedly emerge as hedge fund centres, and given enough time, will stand on par with Singapore, Hong Kong and even London and New York." Rollet added.
Mirabaud & Cie, was founded in Geneva in 1819. Originally a bank operating solely in Switzerland, Mirabaud has since developed its brand on three continents. The bank, which has nearly $22 billion in assets under management, has offices in Geneva, Zurich, Basel, Paris, Monaco, London, Montreal, Nassau, Hong Kong and now Dubai.
Mirabaud forecasts that hedge funds will become increasingly attractive to the region’s ever-more sophisticated regional investors, especially given the high levels of excess liquidity in the Middle East.
CEO Gilles Rollet said, "Globally, hedge fund centres have emerged from the most sophisticated financial centres, such as New York, London, Hong Kong and Singapore. The relevant defining attribute of each of these locations is the maturity of their capital markets….The Dubai International Financial Centre has even taken the step, through its regulating body the Dubai Financial Services Authority, to create a Hedge Fund Code of Practice, giving legal weight to the effort to make Dubai a centre in the hedge fund industry."
Increased institutional investment in the regional capital markets, especially the UAE, is another sign of the maturity of markets here, Mirabaud’s research found. Globally, at a time when most traditional investments are generating low levels of returns, institutional investors are increasingly attracted to alternative asset classes such as hedge funds.
"A hedge fund-friendly environment can be seen to emerge from a region with high levels of excess liquidity and strong degrees of professionalism among regulators and service providers. The Middle East is well known for its access to enormous amounts of excess liquidity due to the high price of oil. In the UAE and Qatar, we are now seeing professionalism from both regulators and service providers grow steadily. Both countries have governments that are committed to forging legal structures that allow for increasing financial sophistication in their respective financial districts. If current trends continue, these two countries will undoubtedly emerge as hedge fund centres, and given enough time, will stand on par with Singapore, Hong Kong and even London and New York." Rollet added.
Mirabaud & Cie, was founded in Geneva in 1819. Originally a bank operating solely in Switzerland, Mirabaud has since developed its brand on three continents. The bank, which has nearly $22 billion in assets under management, has offices in Geneva, Zurich, Basel, Paris, Monaco, London, Montreal, Nassau, Hong Kong and now Dubai.
22 Feb 2008
CAI's Two New Investment Strategies
Choice Alternative Investments, Ltd.(CAI) has introduced two new alternative investment strategies into the market.
The first being the Standard & Poor's DTI, which is a low volatility strategy that works particularly well with very large fixed income alternative investment strategies, according to Arne Langaskens, advisor at CAI, "Due to the success of the alternative investment strategies, CAI is also looking to expand its exposure in the alternative and hedge fund arena," he said.
The DTI plans to offer yield enhancement and diversification, it currently has over $725 million allocated to it at this point.
The other is CAI Aggressive Growth Strategy ("CAI AG") which is a high volatility aggressive growth relative strength equity strategy. CAI AG is suited more for investors seeking higher rates of return that can accept high volatility for this segment of their portfolio. A major Swiss Bank seeded the strategy and it now has over $15 million allocated to it.
CAI is an uniquely focused alternative asset manager delivering structure, risk control, seeking long-term performance stewarding global capital.
The first being the Standard & Poor's DTI, which is a low volatility strategy that works particularly well with very large fixed income alternative investment strategies, according to Arne Langaskens, advisor at CAI, "Due to the success of the alternative investment strategies, CAI is also looking to expand its exposure in the alternative and hedge fund arena," he said.
The DTI plans to offer yield enhancement and diversification, it currently has over $725 million allocated to it at this point.
The other is CAI Aggressive Growth Strategy ("CAI AG") which is a high volatility aggressive growth relative strength equity strategy. CAI AG is suited more for investors seeking higher rates of return that can accept high volatility for this segment of their portfolio. A major Swiss Bank seeded the strategy and it now has over $15 million allocated to it.
CAI is an uniquely focused alternative asset manager delivering structure, risk control, seeking long-term performance stewarding global capital.
21 Feb 2008
Tremont Hires FoHF Specialist
Tremont Capital Management announced the appointment of fund of hedge fund specialist Susan Crotty as Managing Director of Investment Management Services.
“Sue’s extensive experience consulting to a wide variety of institutions on fund of hedge fund investing, her understanding of what investors are seeking to accomplish with their alternatives strategy, and her knowledge of our industry delivers tremendous benefits to our clients,” said Rupert Allan, Tremont’s President and Chief Executive Officer.
“We set out to scale our operations as we grow fund of hedge fund assets, expand our global footprint and deliver excellence in investment management,” said Allan. “We have taken some very exciting steps to insure that we have the right senior team in place to achieve those goals.”
Crotty was formerly Senior Vice President, Alternatives Practice Leader, at Callan Associates. Prior to her tenure at Callan, she was a Managing Director at Ark Asset Management and a Senior Consultant at Hamilton & Company. She is also a member of the Investment Committee for the State of New Jersey Pension System. Crotty will report to Robert Stone, Executive Vice President and Global Head of Sales.
Tremont also has offices in London, Toronto and Hong Kong. Tremont operating subsidiaries are regulated around the world by the U.S.’s Securities and Exchange Commission, the U.K.’s Financial Services Authority, the Ontario Securities Commission and the Hong Kong Securities and Futures Commission.
“Sue’s extensive experience consulting to a wide variety of institutions on fund of hedge fund investing, her understanding of what investors are seeking to accomplish with their alternatives strategy, and her knowledge of our industry delivers tremendous benefits to our clients,” said Rupert Allan, Tremont’s President and Chief Executive Officer.
“We set out to scale our operations as we grow fund of hedge fund assets, expand our global footprint and deliver excellence in investment management,” said Allan. “We have taken some very exciting steps to insure that we have the right senior team in place to achieve those goals.”
Crotty was formerly Senior Vice President, Alternatives Practice Leader, at Callan Associates. Prior to her tenure at Callan, she was a Managing Director at Ark Asset Management and a Senior Consultant at Hamilton & Company. She is also a member of the Investment Committee for the State of New Jersey Pension System. Crotty will report to Robert Stone, Executive Vice President and Global Head of Sales.
Tremont also has offices in London, Toronto and Hong Kong. Tremont operating subsidiaries are regulated around the world by the U.S.’s Securities and Exchange Commission, the U.K.’s Financial Services Authority, the Ontario Securities Commission and the Hong Kong Securities and Futures Commission.
TCI Challenges Japanese Government On Foreign Investments
UK hedge fund TCI has challenged Japanese attempts to control foreign investments. In a bid to boost its stake in Japanese utility J-Power to up to 20 percent, the Children's Investment Fund, or TCI, has been pressuring the electricity wholesaler to improve corporate governance.
The activist investor has even said in a statement that it would take the Japanese government to court if it rejected its bid. The standoff between TCI and the government over the electricity wholesaler is being watched closely as a test for how open Japan is to foreign investment.
Foreign investors who are seeking stakes above 10% in sectors that Japan considers fundamental to national security such as utilities, arms, nuclear power equipment and aircraft must seek government approval.
J-Power plans to complete its first nuclear power plant in 2012.
TCI, named after its donations to children's charities, manages over $10 billion of assets globally.
Hedge Fund Managers Indicted
Five individuals who defrauded hedge fund investors of more than $200 million dollars have been indicted on charges of conspiracy and wire fraud, according to an FBI release.
Assistant Attorney General Alice S. Fisher of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida named the hedge fund managers in the indictment as Michael Lauer, Martin Garvey, and Eric Hauser, co-owners of management companies which directed the hedge funds, and Laurence Isaacson and Milton Barbarosh, who had financial interests in Boca Raton, Fla.-based “shell” companies in which the hedge funds invested.
All of the defendants are charged with one count of conspiracy to commit mail, wire and securities fraud and six counts of wire fraud. If convicted, each of the defendants faces a maximum sentence of 20 years and a $250,000 fine for each count of wire fraud and five years and a $250,000 fine for the conspiracy count. The indictment also seeks forfeiture of their criminal proceeds.
According to the indictment, Lauer, as founder and primary manager, formed and directed several hedge funds, collectively known as the Lancer Group hedge funds. From October 1999 to July 2003, Lauer and his co-defendants manipulated the closing market price of thinly-traded shell company securities to falsely inflate the value of the Lancer Group hedge funds. Lauer, Isaacson, and Barborosh identified “shell” companies, including ones owned by Barbarosh, in which the Lancer Group would buy large quantities of “restricted” stock at pennies per share in private transactions.
Lauer, Garvey and Hauser next directed brokers to buy a small amount of the same securities for the Lancer Group at a much higher open market price and to make additional small purchases to drive up the price to a closing “target price.” Lauer then falsely valued all of the securities held by the Lancer Group, including those restricted shares obtained for pennies per share, at the much higher closing price, which falsely boosted the 20 percent performance fees paid to the management companies; induced new investors to buy into the funds; and kept existing investors in the funds.
To cover up and perpetuate the scheme, the indictment alleges, Lauer also created fake portfolios of the securities supposedly held by the Lancer Group and obtained falsely inflated appraisals of the shell companies through Isaacson and Barbarosh.
An indictment is merely a charge. All defendants are presumed innocent until proven guilty.
Assistant Attorney General Alice S. Fisher of the Criminal Division and U.S. Attorney R. Alexander Acosta of the Southern District of Florida named the hedge fund managers in the indictment as Michael Lauer, Martin Garvey, and Eric Hauser, co-owners of management companies which directed the hedge funds, and Laurence Isaacson and Milton Barbarosh, who had financial interests in Boca Raton, Fla.-based “shell” companies in which the hedge funds invested.
All of the defendants are charged with one count of conspiracy to commit mail, wire and securities fraud and six counts of wire fraud. If convicted, each of the defendants faces a maximum sentence of 20 years and a $250,000 fine for each count of wire fraud and five years and a $250,000 fine for the conspiracy count. The indictment also seeks forfeiture of their criminal proceeds.
According to the indictment, Lauer, as founder and primary manager, formed and directed several hedge funds, collectively known as the Lancer Group hedge funds. From October 1999 to July 2003, Lauer and his co-defendants manipulated the closing market price of thinly-traded shell company securities to falsely inflate the value of the Lancer Group hedge funds. Lauer, Isaacson, and Barborosh identified “shell” companies, including ones owned by Barbarosh, in which the Lancer Group would buy large quantities of “restricted” stock at pennies per share in private transactions.
Lauer, Garvey and Hauser next directed brokers to buy a small amount of the same securities for the Lancer Group at a much higher open market price and to make additional small purchases to drive up the price to a closing “target price.” Lauer then falsely valued all of the securities held by the Lancer Group, including those restricted shares obtained for pennies per share, at the much higher closing price, which falsely boosted the 20 percent performance fees paid to the management companies; induced new investors to buy into the funds; and kept existing investors in the funds.
To cover up and perpetuate the scheme, the indictment alleges, Lauer also created fake portfolios of the securities supposedly held by the Lancer Group and obtained falsely inflated appraisals of the shell companies through Isaacson and Barbarosh.
An indictment is merely a charge. All defendants are presumed innocent until proven guilty.
20 Feb 2008
Boneparth Joins Hall Capital Partners
Hall Capital Partners LLC today announced that John F. Boneparth will join the firm as President. Mr. Boneparth will join Chief Executive Officer and Chief Investment Officer Kathryn A. Hall and Director of Investment Advisory Services John W. Buoymaster as a member of the firm’s Executive Committee. He will also serve on Hall Capital’s Board of Directors along with Ms. Hall; Mr. Buoymaster; F. Warren Hellman, Co-founder and Chairman of Hellman & Friedman; Mark E. McKee, President of Capital Alternatives; and Matthew R. Barger, Senior Advisor for Hellman & Friedman.
Hall Capital is an independent, privately owned SEC-registered investment advisory firm with offices in San Francisco and New York. The firm, which has $22 billion in assets under management, has established a strong reputation as a successful investment partner and manager of traditional and alternative investment strategies. Hall Capital has a 13-year record of building and managing customized global investment portfolios for individuals, families, and institutions.
“We are extremely pleased to have John Boneparth join Hall Capital Partners,” said Kathryn Hall. “His nearly 30 years of experience in the investment management industry as well as his extraordinary talent in building and managing investment management firms will be an important contributor to our company’s growth and future success.”
“Katie Hall and her management team have built a world-class investment platform that offers its clients access to the highest quality traditional and alternative investment products,” said John Boneparth. “I am confident that these products will have great appeal to both institutional and individual investors when they are distributed more broadly, both in the U.S. and abroad.”
“John Boneparth has had great success growing and managing businesses throughout his career,” said Warren Hellman. “The board believes that with John joining Katie’s team, the firm is well-positioned for significant growth and expansion.”
Mr. Boneparth founded Corinthian Cove Consulting, LLC in 2005, where he consulted to investment management companies on business, sales, marketing, client service, and product strategies. Before founding Corinthian Cove Consulting, Mr. Boneparth spent 14 years at Putnam Investments where he held various positions including Chief of U.S. Institutional Sales, Head of International Sales & Client Service, Head of International Business, and Head of Putnam Global Institutional Management. Mr. Boneparth holds a M.S. from University of Pennsylvania and a B.S. from The Wharton School, University of Pennsylvania.
About Hall Capital Partners LLC
Hall Capital Partners LLC (www.hallcapital.com) is an independent, privately owned SEC-registered investment advisory firm with offices in San Francisco and New York. Founded by Kathryn Hall, the firm has a 13-year record in building and managing global investment portfolios, and has established a strong reputation as a successful investor and partner. As of September 30, 2007, the firm directed investment assets in excess of $22 billion for more than 100 clients and its funds of funds program.
Hall Capital is an independent, privately owned SEC-registered investment advisory firm with offices in San Francisco and New York. The firm, which has $22 billion in assets under management, has established a strong reputation as a successful investment partner and manager of traditional and alternative investment strategies. Hall Capital has a 13-year record of building and managing customized global investment portfolios for individuals, families, and institutions.
“We are extremely pleased to have John Boneparth join Hall Capital Partners,” said Kathryn Hall. “His nearly 30 years of experience in the investment management industry as well as his extraordinary talent in building and managing investment management firms will be an important contributor to our company’s growth and future success.”
“Katie Hall and her management team have built a world-class investment platform that offers its clients access to the highest quality traditional and alternative investment products,” said John Boneparth. “I am confident that these products will have great appeal to both institutional and individual investors when they are distributed more broadly, both in the U.S. and abroad.”
“John Boneparth has had great success growing and managing businesses throughout his career,” said Warren Hellman. “The board believes that with John joining Katie’s team, the firm is well-positioned for significant growth and expansion.”
Mr. Boneparth founded Corinthian Cove Consulting, LLC in 2005, where he consulted to investment management companies on business, sales, marketing, client service, and product strategies. Before founding Corinthian Cove Consulting, Mr. Boneparth spent 14 years at Putnam Investments where he held various positions including Chief of U.S. Institutional Sales, Head of International Sales & Client Service, Head of International Business, and Head of Putnam Global Institutional Management. Mr. Boneparth holds a M.S. from University of Pennsylvania and a B.S. from The Wharton School, University of Pennsylvania.
About Hall Capital Partners LLC
Hall Capital Partners LLC (www.hallcapital.com) is an independent, privately owned SEC-registered investment advisory firm with offices in San Francisco and New York. Founded by Kathryn Hall, the firm has a 13-year record in building and managing global investment portfolios, and has established a strong reputation as a successful investor and partner. As of September 30, 2007, the firm directed investment assets in excess of $22 billion for more than 100 clients and its funds of funds program.
19 Feb 2008
Centaurus Capital Raises Stake In UK Waste Management
Centaurus Capital Ltd. announced an increase in their stake in Biffa PLC to 4.23%. The London-based hedge fund bought about 1.15 million shares in two tranches, lifting its stake to about 14 million shares, or 3.758%.
UK waste management and recyling business, Biffa, recently agreed to a takeover offer by WasteAcquisitionco, a consortium of various entities within the Montagu Funds, the Global Infrastructure Partners Funds and UCIL at 350 pence per share, valuing Biffa at about £1.23 billion ($2.4 billion).
Centaurus Capital is a private investment management company with an emphasis on Europe. Centaurus was launched in year 2000 and originated from an investment team working together at BNP Paribas since 1993.
In 2005, the Centaurus Alpha Fund was awarded the Hedge Funds Review European Performance Award in the category of Event Driven Fund.
Other hedge funds such as Cheyne Capital Management (UK) LLP and Davidson Kempner European Partners LLP, an affiliate of New York-based Davidson Kempner Capital Management LLC, have emerged as investors in Biffa in the hope of a bidding war.
UK waste management and recyling business, Biffa, recently agreed to a takeover offer by WasteAcquisitionco, a consortium of various entities within the Montagu Funds, the Global Infrastructure Partners Funds and UCIL at 350 pence per share, valuing Biffa at about £1.23 billion ($2.4 billion).
Centaurus Capital is a private investment management company with an emphasis on Europe. Centaurus was launched in year 2000 and originated from an investment team working together at BNP Paribas since 1993.
In 2005, the Centaurus Alpha Fund was awarded the Hedge Funds Review European Performance Award in the category of Event Driven Fund.
Other hedge funds such as Cheyne Capital Management (UK) LLP and Davidson Kempner European Partners LLP, an affiliate of New York-based Davidson Kempner Capital Management LLC, have emerged as investors in Biffa in the hope of a bidding war.
Asia-Pacific Investable Hedge Fund Index Launch
Index compiler MSCI Barra announced today that it is to launch the MSCI Asia-Pacific Hedge Fund OPTIX Index, a new investable hedge fund index designed to reflect the overall structure and composition of the Asia-Pacific hedge fund universe.
Henry Fernandez, CEO of MSCI Barra, said, “The forthcoming launch of the MSCI Asia-Pacific Hedge Fund OPTIX Index responds to investor demand for a liquid and representative investable hedge fund index that reflects the overall Asia-Pacific hedge fund opportunity set. The index is designed to serve as the basis of index-linked financial products, such as funds, derivatives, and structured products.”
The MSCI Asia-Pacific Hedge Fund OPTIX Index will be composed of only funds that are open to new subscriptions and with at least monthly liquidity, according to a statement from the index compiler.
NAI, working with SPARX International (Hong Kong) Limited will be responsible for selecting and conducting due diligence on the hedge fund managers. NAI will also monitor the investment mandate of each managed fund.
Calculation of the index is expected to begin in March 2008, and it is expected to launch with around 20 constituent funds. The index will be constructed and maintained by MSCI Barra according to the MSCI Investable Hedge Fund Index Methodology.
Henry Fernandez, CEO of MSCI Barra, said, “The forthcoming launch of the MSCI Asia-Pacific Hedge Fund OPTIX Index responds to investor demand for a liquid and representative investable hedge fund index that reflects the overall Asia-Pacific hedge fund opportunity set. The index is designed to serve as the basis of index-linked financial products, such as funds, derivatives, and structured products.”
The MSCI Asia-Pacific Hedge Fund OPTIX Index will be composed of only funds that are open to new subscriptions and with at least monthly liquidity, according to a statement from the index compiler.
NAI, working with SPARX International (Hong Kong) Limited will be responsible for selecting and conducting due diligence on the hedge fund managers. NAI will also monitor the investment mandate of each managed fund.
Calculation of the index is expected to begin in March 2008, and it is expected to launch with around 20 constituent funds. The index will be constructed and maintained by MSCI Barra according to the MSCI Investable Hedge Fund Index Methodology.
18 Feb 2008
2008: The Year of Carbon Finance and Trading
The seventh annual Wall Street Green Trading Summit is presenting answers to carbon trading questions such as;
What is carbon neutral? How are clean energy technologies tied to emissions trading? What are the carbon investment opportunities? These and other timely questions will be discussed and answered at the sixth annual Wall Street Green Trading and Finance Summit. Experts from Morrison & Foerster, Evolution Markets, Point Carbon, NYMEX, Natsource, Orion Energy Services, APX, EcoSecurities, and Brown Rudnick..
2008 is the beginning of global carbon markets under Kyoto and is demonstrating a tremendous interest in how to reduce the carbon footprint of companies.
Also feartured at the conference;
• US Carbon Market Developments
• What's the Difference Between Carbon Credits & Offsets
• What's New in European Carbon Trading
• What Impact Will Carbon Regulation Have on US Businesses
• What's the Commercial Value of Carbon Sequestration
• What is NYMEX's Green Exchange
• How Renewables & Carbon Offsets Interact
• What is Carbon Finance
• Why the US is the Next Carbon Market
• Relationship Between Carbon & Renewables
Organized by:
Global Change Associates & Hedge Connection
What is carbon neutral? How are clean energy technologies tied to emissions trading? What are the carbon investment opportunities? These and other timely questions will be discussed and answered at the sixth annual Wall Street Green Trading and Finance Summit. Experts from Morrison & Foerster, Evolution Markets, Point Carbon, NYMEX, Natsource, Orion Energy Services, APX, EcoSecurities, and Brown Rudnick..
2008 is the beginning of global carbon markets under Kyoto and is demonstrating a tremendous interest in how to reduce the carbon footprint of companies.
Also feartured at the conference;
• US Carbon Market Developments
• What's the Difference Between Carbon Credits & Offsets
• What's New in European Carbon Trading
• What Impact Will Carbon Regulation Have on US Businesses
• What's the Commercial Value of Carbon Sequestration
• What is NYMEX's Green Exchange
• How Renewables & Carbon Offsets Interact
• What is Carbon Finance
• Why the US is the Next Carbon Market
• Relationship Between Carbon & Renewables
Organized by:
Global Change Associates & Hedge Connection
MAM Hedge Fund Launch
Martin Asset Management announced the launch of the MAM Global ETF Fund, LP (a domestic Delaware Limited Partnership).
The MAM Global ETF Fund is set to launch on February 15th, the new hedge fund features monthly liquidity and will exclusively invest in Exchange Traded Funds with a Global Macro strategy.
The California based global wealth management platform also features two ETF (Exchange Traded Funds) strategies and one Alternative Energy Strategy.
Their investment style focuses on the overall markets and the economy rather than individual stocks and bonds. The strategy includes the analysis of economic data such as GDP, inflation, unemployment, money flows and overall market conditions to determine the current phase of the business cycle (expansion, peak, contraction or trough).
Once the business cycle is identified, through active management within separately managed accounts, the hedge fund then rebalances its investment portfolios. Custody can be obtained anywhere in the world with no restrictions on nationality of clients.
Alex Akesson
Editor for HedgeCo.Net
Email: alex@hedgeco.net
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds!
Be sure to check out our sister sites. www.hedgefundlounge.com, www.hedgefundtools.com, and www.hedgefundemployment.com
The MAM Global ETF Fund is set to launch on February 15th, the new hedge fund features monthly liquidity and will exclusively invest in Exchange Traded Funds with a Global Macro strategy.
The California based global wealth management platform also features two ETF (Exchange Traded Funds) strategies and one Alternative Energy Strategy.
Their investment style focuses on the overall markets and the economy rather than individual stocks and bonds. The strategy includes the analysis of economic data such as GDP, inflation, unemployment, money flows and overall market conditions to determine the current phase of the business cycle (expansion, peak, contraction or trough).
Once the business cycle is identified, through active management within separately managed accounts, the hedge fund then rebalances its investment portfolios. Custody can be obtained anywhere in the world with no restrictions on nationality of clients.
Alex Akesson
Editor for HedgeCo.Net
Email: alex@hedgeco.net
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds!
Be sure to check out our sister sites. www.hedgefundlounge.com, www.hedgefundtools.com, and www.hedgefundemployment.com
Hedge Fund Vehicle Dexion Absolute Raises $263 Million
Dexion Absolute, a 1.4 billion pound ($2.7 billion) fund of hedge funds (FoHF) announced today that it raised a further $263 million for its hedge fund investments. Dexion had previously raised $950 million above its original target in an oversubscribed share issue in December last year.
According to the Association of Investment Companies, hedge funds made up the biggest proportion both of investment firms' new issues and firms raising additional capital in 2007.
The FoHF's assets are invested in an actively managed portfolio of hedge funds selected by its Investment Advisor and diversified by investment strategy, style and manager. Another fund of hedge funds that is marketed by Dexion Capital, is considering a new offer of shares to meet demand from new and existing investors. The fund of macro hedge funds is managed by Permal Group, part of Legg Mason Inc.
According to the Association of Investment Companies, hedge funds made up the biggest proportion both of investment firms' new issues and firms raising additional capital in 2007.
The FoHF's assets are invested in an actively managed portfolio of hedge funds selected by its Investment Advisor and diversified by investment strategy, style and manager. Another fund of hedge funds that is marketed by Dexion Capital, is considering a new offer of shares to meet demand from new and existing investors. The fund of macro hedge funds is managed by Permal Group, part of Legg Mason Inc.
15 Feb 2008
Hedge Funds & Alternative Investments Handbook
Research and Markets has announced the addition of “The Hedge Funds & Alternative Investments Handbook 2008” to their offering.
The 2008 edition of this guide to the world of alternative investments comes as the playing field becomes more exciting due to new concepts, regulation and increasingly global reach of hedge funds. The handbook brings together an internationally acclaimed editorial board of experts in the field of alternative investments.
Including topical debate, discussion and the latest research on the issues of the moment within the hedge funds and alternative investments world. Leading players from exchanges, funds, law firms and investment banks present exclusive insights into offshore developments, the key regions, regulation and the role of education and ethics in this rapidly changing and evolving scene.
Articles in this year’s Hedge Funds and Alternative Investments Handbook explore;
alternative beta replication
precious metals
the role of branding
self regulation
global activism
ethics and regional perspectives.
The 2008 edition of this guide to the world of alternative investments comes as the playing field becomes more exciting due to new concepts, regulation and increasingly global reach of hedge funds. The handbook brings together an internationally acclaimed editorial board of experts in the field of alternative investments.
Including topical debate, discussion and the latest research on the issues of the moment within the hedge funds and alternative investments world. Leading players from exchanges, funds, law firms and investment banks present exclusive insights into offshore developments, the key regions, regulation and the role of education and ethics in this rapidly changing and evolving scene.
Articles in this year’s Hedge Funds and Alternative Investments Handbook explore;
alternative beta replication
precious metals
the role of branding
self regulation
global activism
ethics and regional perspectives.
14 Feb 2008
HedgeCo Networks Offers Clients of NorthPoint Trading Suite of HedgeCo Web Services
HedgeCo LLC, a premier hedge fund database, consulting and services company, announced today a strategic relationship with NorthPoint Trading Partners, LLC. This relationship will offer clients of NorthPoint a chance to enhance their Internet presence through the use of the HedgeCo Websites Platform.
"Through our partnerships, HedgeCo is striving to enhance the offerings of our partners, as well as draw on expertise of our partners to take the HedgeCo Networks products to a new level." said Evan Rapoport, Chief Executive Officer of HedgeCo, LLC. "By having the ability to offer our products to their clients, our partners will find that their offerings and position in the market will strengthen substantially."
The announcement once again shows how HedgeCo Networks continues to distinguish its company from other service providers by offering high-tech, cost-effective services and analytic tools.
Products being offered through this agreement include the HedgeCo Hedge Fund Website platform, the Hedge Fund Calculator analytics tool, and the opportunity to integrate with HedgeCo.Net, the premier hedge fund Internet portal.
“NorthPoint Trading is committed to being able to provide every possible advantage and resource to help our clients grow their business. We are excited to be able to offer the expertise and experience of the Hedgeco Websites team to our clients.” said Michael DeJarnette, Co-Founder and President of NorthPoint Trading Partners, LLC, a broker/dealer focused on providing Prime Brokerage to small to mid-sized hedge funds.
HedgeCo Networks is actively seeking partners in various verticals to develop and deploy future products.
HedgeCo, LLC manages HedgeCo.Net the premier Hedge Fund Database and Information Portal. HedgeCo offers a wide variety of services, including website design, consultation, and third party marketing.
The HedgeCo Websites team has worked with the Hedge Fund industry for 3 years. Drawing on the experience used in creating and managing HedgeCo.Net over 150 websites for Hedge Fund firms in USA, Europe and Australia.
NorthPoint Trading Partners, LLC is a
premier institutional brokerage and fund services company, dedicated to providing prime brokerage services to small and medium sized hedge funds. Through a fully disclosed clearing relationship with Goldman Sachs Execution and Clearing, L.P. (GSEC), clients receive the benefits of boutique firm service and pricing, combined with GSEC's professional clearing and prime brokerage services, integrated portfolio and trading functionality, suite of pre- and post-trade analytics, and direct access
to the Goldman Sachs & Co.'s securities lending group.
Goldman Sachs Execution & Clearing, L.P. is not affiliated with NorthPoint Trading Partners, LLC or any of its subsidiaries or affiliates.
"Through our partnerships, HedgeCo is striving to enhance the offerings of our partners, as well as draw on expertise of our partners to take the HedgeCo Networks products to a new level." said Evan Rapoport, Chief Executive Officer of HedgeCo, LLC. "By having the ability to offer our products to their clients, our partners will find that their offerings and position in the market will strengthen substantially."
The announcement once again shows how HedgeCo Networks continues to distinguish its company from other service providers by offering high-tech, cost-effective services and analytic tools.
Products being offered through this agreement include the HedgeCo Hedge Fund Website platform, the Hedge Fund Calculator analytics tool, and the opportunity to integrate with HedgeCo.Net, the premier hedge fund Internet portal.
“NorthPoint Trading is committed to being able to provide every possible advantage and resource to help our clients grow their business. We are excited to be able to offer the expertise and experience of the Hedgeco Websites team to our clients.” said Michael DeJarnette, Co-Founder and President of NorthPoint Trading Partners, LLC, a broker/dealer focused on providing Prime Brokerage to small to mid-sized hedge funds.
HedgeCo Networks is actively seeking partners in various verticals to develop and deploy future products.
HedgeCo, LLC manages HedgeCo.Net the premier Hedge Fund Database and Information Portal. HedgeCo offers a wide variety of services, including website design, consultation, and third party marketing.
The HedgeCo Websites team has worked with the Hedge Fund industry for 3 years. Drawing on the experience used in creating and managing HedgeCo.Net over 150 websites for Hedge Fund firms in USA, Europe and Australia.
NorthPoint Trading Partners, LLC is a
premier institutional brokerage and fund services company, dedicated to providing prime brokerage services to small and medium sized hedge funds. Through a fully disclosed clearing relationship with Goldman Sachs Execution and Clearing, L.P. (GSEC), clients receive the benefits of boutique firm service and pricing, combined with GSEC's professional clearing and prime brokerage services, integrated portfolio and trading functionality, suite of pre- and post-trade analytics, and direct access
to the Goldman Sachs & Co.'s securities lending group.
Goldman Sachs Execution & Clearing, L.P. is not affiliated with NorthPoint Trading Partners, LLC or any of its subsidiaries or affiliates.
12 Feb 2008
Report Examines Developments in the Spanish Fund Supermarket
Research and Markets has announced the addition of "Fund supermarkets in Spain 2007" to their offering. The report examines developments in the Spanish fund supermarket sector and assesses the distribution channels that are in operation. The report analyzes both the current and possible future trends of the industry.
Spanish legislation has recently made provisions for two new fund classes available to retail investors, exchange traded funds and funds of hedge funds, allowing fund supermarkets to offer a comprehensive range of investment funds. Covering both domestic and international markets as they exercise considerable control over the fortunes of fund managers through their short-lists of recommended funds.
Year-on-year growth in assets under management fell from 11.94% in 2005 to 1.31% in 2006. This sharp decline in growth is partly attributed to a growing preference for bank deposits (among conservative investors) triggered largely by the introduction of a new tax regime, and increasing demand for foreign funds (among more sophisticated investors).
Spanish legislation has recently made provisions for two new fund classes available to retail investors, exchange traded funds and funds of hedge funds, allowing fund supermarkets to offer a comprehensive range of investment funds. Covering both domestic and international markets as they exercise considerable control over the fortunes of fund managers through their short-lists of recommended funds.
Year-on-year growth in assets under management fell from 11.94% in 2005 to 1.31% in 2006. This sharp decline in growth is partly attributed to a growing preference for bank deposits (among conservative investors) triggered largely by the introduction of a new tax regime, and increasing demand for foreign funds (among more sophisticated investors).
Hedge Funds Decline in January 2008
The Greenwich Global Hedge Fund Index (GGHFI), fell -2.44% in January amid severe declines in global equity markets such as the S&P 500, MSCI World Equity, and FTSE 100 indices.
Meanwhile, 79% of hedge funds outperformed the S&P 500, with 33% ending the month in positive territory.
Margaret Gilbert, Managing Director of GGHFI said, "Despite January being hedge funds’ weakest month since July 2002, hedge funds fell far less than equities..... This ‘downside protection’ is particularly apparent over the last twelve months with hedge funds returning +7.14%, outperforming the S&P 500 by +9.45% during this period."
For January, all four hedge fund strategy groups outperformed the S&P 500, according to the report. Directional Trading ended up +0.81%, while dedicated Short Sellers were the stellar performers, up +6.99%. January’s Index currently includes 1,011 constituent funds.
Greenwich Alternative Investments, LLC manages one of the world's largest hedge fund databases and is a provider of hedge fund indices, asset management services and research to institutional investors worldwide.
Meanwhile, 79% of hedge funds outperformed the S&P 500, with 33% ending the month in positive territory.
Margaret Gilbert, Managing Director of GGHFI said, "Despite January being hedge funds’ weakest month since July 2002, hedge funds fell far less than equities..... This ‘downside protection’ is particularly apparent over the last twelve months with hedge funds returning +7.14%, outperforming the S&P 500 by +9.45% during this period."
For January, all four hedge fund strategy groups outperformed the S&P 500, according to the report. Directional Trading ended up +0.81%, while dedicated Short Sellers were the stellar performers, up +6.99%. January’s Index currently includes 1,011 constituent funds.
Greenwich Alternative Investments, LLC manages one of the world's largest hedge fund databases and is a provider of hedge fund indices, asset management services and research to institutional investors worldwide.
Hedge Funds World Conference
The 2008 ninth annual Hedge Funds World Middle East Conference is to be held at the Madinat Jumeirah Hotel from 3-6 March 2008.
A highlight will be the Second Annual Hedge Funds World Middle East Awards Ceremony on 4 March, presented by Man Investments and Terrapinn. The awards recognise excellence and innovation in the Middle East hedge fund industry and promote the asset class in the region. Finalists for the awards are listed below.
Man Investments, one of the world's leading providers of alternative investments, is once again a principal sponsor of the event. The company, which has prospered in the Middle East for more than 20 years, has strongly supported the Hedge Funds World Middle East Conference since the first such event in 1999.
A special highlight at the conference will be the welcome address by Nasser Al Shaali, CEO of the Dubai International Financial Centre Authority. The DIFC has established itself as the first international financial centre of the region and the fastest growing in the world. Today it is home to more than 500 companies including many of the world's leading financial firms.
Keynote speakers include industry leaders such as: Sindo Oliveros, director of Pension Plan and Endowments, the World Bank Pension Fund; Ronald A. Rolighed, Managing Director, Harris Alternatives LLC; Ikho Suh, Head of Investment Strategy, Korea Investment Corporation; Christopher Durand, Head of Alternative Investments, Abu Dhabi Investment Company; Dr Mehraj Mattoo, Global Head of Commerzbank Alternative Investment Strategies; Ann Thivierge, MD and Head of Active International Allocation Strategy, Morgan Stanley; and Dr Susgil Wadhwani, CBE, CEO, Wadhwani Asset Management.
Antoine Massad, Chief Executive of Man Investments Middle East Limited who is once again chairing the event said, 'The hedge fund industry has made big advances in the region in recent years, offering investors wider choices and a range of new opportunities.. At this event, we will again recognise this progress and promote it through the Hedge Funds World Middle East Awards.'
A highlight will be the Second Annual Hedge Funds World Middle East Awards Ceremony on 4 March, presented by Man Investments and Terrapinn. The awards recognise excellence and innovation in the Middle East hedge fund industry and promote the asset class in the region. Finalists for the awards are listed below.
Man Investments, one of the world's leading providers of alternative investments, is once again a principal sponsor of the event. The company, which has prospered in the Middle East for more than 20 years, has strongly supported the Hedge Funds World Middle East Conference since the first such event in 1999.
A special highlight at the conference will be the welcome address by Nasser Al Shaali, CEO of the Dubai International Financial Centre Authority. The DIFC has established itself as the first international financial centre of the region and the fastest growing in the world. Today it is home to more than 500 companies including many of the world's leading financial firms.
Keynote speakers include industry leaders such as: Sindo Oliveros, director of Pension Plan and Endowments, the World Bank Pension Fund; Ronald A. Rolighed, Managing Director, Harris Alternatives LLC; Ikho Suh, Head of Investment Strategy, Korea Investment Corporation; Christopher Durand, Head of Alternative Investments, Abu Dhabi Investment Company; Dr Mehraj Mattoo, Global Head of Commerzbank Alternative Investment Strategies; Ann Thivierge, MD and Head of Active International Allocation Strategy, Morgan Stanley; and Dr Susgil Wadhwani, CBE, CEO, Wadhwani Asset Management.
Antoine Massad, Chief Executive of Man Investments Middle East Limited who is once again chairing the event said, 'The hedge fund industry has made big advances in the region in recent years, offering investors wider choices and a range of new opportunities.. At this event, we will again recognise this progress and promote it through the Hedge Funds World Middle East Awards.'
11 Feb 2008
Hedge Fund Launches By QIM
US based Quantitative Investment Management(QIM), has launched two new hedge funds, the Quantitative Tactical Fund and the Quantitative Fund. Director of Marketing, John McAllister said of the launches, "The multi-strat gives us an ability to provide a fund of funds using three products that we expect to have very low correlations to each other, and it is expected to have the best Sharpe ratio of all the products."
One of the hedge funds launched is a diversified equities hedge fund, currently trading only U.S. names. With $126.8 million in assets under management, the Tactical Fund trades the 1,500 most liquid U.S. names, with plans to expand into Europe and Japan this year.
The smaller of the two funds, the Quantitative Fund, is a multi-strategy fund of funds with $1 million currently in assets under management. It currently invests solely in the 1X versions of other QIM funds, including the Global, Tactical and the Ultra funds. Allocations made to the fund in 2008 will receive a 10% fee discount for the life of the investment.
With $2.8 billion in assets under management, QIM is a global investment firm specializing in alternative investment strategies for institutional and private investors. QIM employs a proprietary quantitative approach to trading financial and commodity futures through its flagship offering, the QIM Global Program.
One of the hedge funds launched is a diversified equities hedge fund, currently trading only U.S. names. With $126.8 million in assets under management, the Tactical Fund trades the 1,500 most liquid U.S. names, with plans to expand into Europe and Japan this year.
The smaller of the two funds, the Quantitative Fund, is a multi-strategy fund of funds with $1 million currently in assets under management. It currently invests solely in the 1X versions of other QIM funds, including the Global, Tactical and the Ultra funds. Allocations made to the fund in 2008 will receive a 10% fee discount for the life of the investment.
With $2.8 billion in assets under management, QIM is a global investment firm specializing in alternative investment strategies for institutional and private investors. QIM employs a proprietary quantitative approach to trading financial and commodity futures through its flagship offering, the QIM Global Program.
Hedge Fund Awareness
A white paper released today by SEI, titled "Five Critical Challenges for Hedge Funds Taking Aim at the Institutional Market", details the growing institutional acceptance of hedge fund investing.
Forty-seven percent of the institutions surveyed said they already invest in hedge funds. Within that group, 73% of pension plans and 55% of institutions overall said they had increased hedge fund allocations over the last several years. Portfolio allocations to hedge funds averaged 30% for endowments, 13% for pension funds, and 24% for institutions.
The paper is based partly on a survey of more than 100 institutional investors by SEI and the research firm of Infovest21.
Hedge fund assets under management have been growing at a compound annual rate of 26% since 1990, reports the SEI analysis, with much of that growth coming from the institutional market. "To maintain that growth trajectory, the hedge fund industry will need to branch out from its traditional high-net-worth, foundation, and endowment clientele to serve the broader institutional market," said Paul Schaeffer, Managing Director of Strategy and Innovation for SEI’s Investment Manager Services division. "But to compete for those assets, the industry must recognise that large institutions have a distinct set of demands concerning issues such as the quality of infrastructure, transparency, and risk."
At the same time, institutions expressed continued concerns with hedge fund investing. “Headline risk” was named by 37% of survey respondents as their biggest worry, followed by lack of transparency (19%) and poor performance (15%). Institutions also remain cautious in selecting hedge funds, the survey found, devoting an average of seven months to due diligence and 12 additional weeks to approval.
In the paper, SEI identifies five challenges hedge funds should address in order to attract more institutional assets:
1) Demonstrate institutional-quality infrastructure and operations. Infrastructure was ranked the number-one criterion in hedge fund selection, with 46% of those surveyed naming it most important. Of those who responded this way, 54% said it was because “better managed firms produce better returns.” The quality of fund administration was a prime concern. Of those respondents most concerned with infrastructure, two-thirds said it is unacceptable for funds to handle their own administration internally, and half demand a “big-name” administrator; 81% said they take steps to verify that hedge fund investments are valued independently.
2) Meet investor demands for reporting and transparency. The lack of transparency was the second most commonly cited worry with hedge fund investing, with 19% of institutions ranking it number one. This concern was greatest at the strategy level, with 85% of respondents saying they would not invest in a strategy they do not fully understand. More than half said they seek portfolio transparency at the industry or sector level, and one-third were most concerned with transparency of the investment process. Only 11% said they seek transparency of specific investment positions.
3) Build stable management teams with a full range of skill sets. Interviewees ranked “people at the firm” as the third most important factor in hedge fund selection, surpassed only by “firm infrastructure” and “performance.” Other survey responses revealed that investor concerns with hedge funds’ organisational stability and staffing are not confined to those making investment decisions, but cut across all key management and support positions.
4) Shift focus from performance to investment disciplines. Institutions are as concerned with investment process and risk profile as they are with the level of absolute returns, the survey revealed. Interviewees ranked “consistent, stable returns,” “uncorrelated returns,” and “high risk-adjusted returns” as more important objectives than “high absolute returns.” Seventy-two percent of interviewees said the investment strategy, rather than performance, is their starting point for hedge fund selection.
5) Keep abreast of public policy and regulatory trends. Citing ongoing deliberations over hedge-fund-related regulation, tax policies, and accounting rules and investor concerns with “headline risk,” the paper urges the industry to “commit whatever resources are needed to ensure that hedge fund managers meet the highest possible standards for their overall compliance and general business practices.”
“The overriding message is that institutions clearly prefer to do business with institutional-style organisations,” concluded Schaeffer. “For hedge funds, the challenge will be to fit the profile of an institutional-quality fund while preserving the performance attributes that attracted major investors in the first place.”
Forty-seven percent of the institutions surveyed said they already invest in hedge funds. Within that group, 73% of pension plans and 55% of institutions overall said they had increased hedge fund allocations over the last several years. Portfolio allocations to hedge funds averaged 30% for endowments, 13% for pension funds, and 24% for institutions.
The paper is based partly on a survey of more than 100 institutional investors by SEI and the research firm of Infovest21.
Hedge fund assets under management have been growing at a compound annual rate of 26% since 1990, reports the SEI analysis, with much of that growth coming from the institutional market. "To maintain that growth trajectory, the hedge fund industry will need to branch out from its traditional high-net-worth, foundation, and endowment clientele to serve the broader institutional market," said Paul Schaeffer, Managing Director of Strategy and Innovation for SEI’s Investment Manager Services division. "But to compete for those assets, the industry must recognise that large institutions have a distinct set of demands concerning issues such as the quality of infrastructure, transparency, and risk."
At the same time, institutions expressed continued concerns with hedge fund investing. “Headline risk” was named by 37% of survey respondents as their biggest worry, followed by lack of transparency (19%) and poor performance (15%). Institutions also remain cautious in selecting hedge funds, the survey found, devoting an average of seven months to due diligence and 12 additional weeks to approval.
In the paper, SEI identifies five challenges hedge funds should address in order to attract more institutional assets:
1) Demonstrate institutional-quality infrastructure and operations. Infrastructure was ranked the number-one criterion in hedge fund selection, with 46% of those surveyed naming it most important. Of those who responded this way, 54% said it was because “better managed firms produce better returns.” The quality of fund administration was a prime concern. Of those respondents most concerned with infrastructure, two-thirds said it is unacceptable for funds to handle their own administration internally, and half demand a “big-name” administrator; 81% said they take steps to verify that hedge fund investments are valued independently.
2) Meet investor demands for reporting and transparency. The lack of transparency was the second most commonly cited worry with hedge fund investing, with 19% of institutions ranking it number one. This concern was greatest at the strategy level, with 85% of respondents saying they would not invest in a strategy they do not fully understand. More than half said they seek portfolio transparency at the industry or sector level, and one-third were most concerned with transparency of the investment process. Only 11% said they seek transparency of specific investment positions.
3) Build stable management teams with a full range of skill sets. Interviewees ranked “people at the firm” as the third most important factor in hedge fund selection, surpassed only by “firm infrastructure” and “performance.” Other survey responses revealed that investor concerns with hedge funds’ organisational stability and staffing are not confined to those making investment decisions, but cut across all key management and support positions.
4) Shift focus from performance to investment disciplines. Institutions are as concerned with investment process and risk profile as they are with the level of absolute returns, the survey revealed. Interviewees ranked “consistent, stable returns,” “uncorrelated returns,” and “high risk-adjusted returns” as more important objectives than “high absolute returns.” Seventy-two percent of interviewees said the investment strategy, rather than performance, is their starting point for hedge fund selection.
5) Keep abreast of public policy and regulatory trends. Citing ongoing deliberations over hedge-fund-related regulation, tax policies, and accounting rules and investor concerns with “headline risk,” the paper urges the industry to “commit whatever resources are needed to ensure that hedge fund managers meet the highest possible standards for their overall compliance and general business practices.”
“The overriding message is that institutions clearly prefer to do business with institutional-style organisations,” concluded Schaeffer. “For hedge funds, the challenge will be to fit the profile of an institutional-quality fund while preserving the performance attributes that attracted major investors in the first place.”
8 Feb 2008
IFC Seminar
The Islamic Financial Services Board, the World Bank Group Corporate Governance Department, and the IFC Global Corporate Governance Forum are organising a joint seminar on corporate governance issues in Islamic finance. The two-day seminar will be hosted in Manama by the Central Bank of Bahrain on March 11 to 12, 2008.
The Seminar aims to increase awareness of corporate governance issues in Islamic finance, including banking, insurance, and capital markets (particularly collective investment schemes), among financial regulators and market participants. It will be structured around the corporate governance standards that were developed by the Islamic Financial Services Board, with insights from regulatory officials, corporate governance specialists from international multilateral agencies, and industry practitioners.
H.E. Rasheed Mohammed Al Maraj, Governor of the Central Bank of Bahrain, and Professor Rifaat Ahmed Abdel Karim, Secretary General of the Islamic Financial Services Board, will deliver the opening and welcoming remarks.
Peter Dey, Chairman of the Forum's Private Sector Advisory Group, will deliver a keynote address on the Cross-Sectoral Approach toward Good Governance. Dey served as chairman of the Toronto Stock Exchange Committee on Corporate Governance in Canada, which released a report entitled Where Were the Directors? (also known as the Dey Report) in December 1994. He will be joined by 21 other speakers.
The seminar's main objectives are to:
Highlight corporate governance issues specific to institutions that offer Islamic financial services and to help regulators and market participants improve their understanding of these, especially as the Islamic financial services industry continues to grow rapidly within the global financial system.
Provide stakeholders an opportunity to exchange views and experience about good governance frameworks and best practices.
Generate discussion and policy recommendations about strengthening and improving the corporate governance of institutions that offer Islamic financial services, in accordance with internationally accepted standards.
Those interested in attending the seminar can download the registration form from www.ifsb.org.
The Seminar aims to increase awareness of corporate governance issues in Islamic finance, including banking, insurance, and capital markets (particularly collective investment schemes), among financial regulators and market participants. It will be structured around the corporate governance standards that were developed by the Islamic Financial Services Board, with insights from regulatory officials, corporate governance specialists from international multilateral agencies, and industry practitioners.
H.E. Rasheed Mohammed Al Maraj, Governor of the Central Bank of Bahrain, and Professor Rifaat Ahmed Abdel Karim, Secretary General of the Islamic Financial Services Board, will deliver the opening and welcoming remarks.
Peter Dey, Chairman of the Forum's Private Sector Advisory Group, will deliver a keynote address on the Cross-Sectoral Approach toward Good Governance. Dey served as chairman of the Toronto Stock Exchange Committee on Corporate Governance in Canada, which released a report entitled Where Were the Directors? (also known as the Dey Report) in December 1994. He will be joined by 21 other speakers.
The seminar's main objectives are to:
Highlight corporate governance issues specific to institutions that offer Islamic financial services and to help regulators and market participants improve their understanding of these, especially as the Islamic financial services industry continues to grow rapidly within the global financial system.
Provide stakeholders an opportunity to exchange views and experience about good governance frameworks and best practices.
Generate discussion and policy recommendations about strengthening and improving the corporate governance of institutions that offer Islamic financial services, in accordance with internationally accepted standards.
Those interested in attending the seminar can download the registration form from www.ifsb.org.
7 Feb 2008
Noci Pictures Offers 100% Deductions For Alternative Investors
Noci Pictures Entertainment, A Chicago film finance and production company is offering an innovative way for high net worth investors, hedge funds and private equity groups to receive 100% deductions for film investments as well as state income tax credits.
Yuri Rutman’s Noci Pictures Entertainment is shooting a slate of films in Illinois using a hybrid of tax, finance, risk minimization and exit strategies that offer dollar for dollar Federal Tax Deductions and state income tax credits.
"I don’t know of any other alternative investment that can offer tax incentives, multiple exit strategies, as well as giving back to the local economy, while being involved with the moviemaking process, Rutman states, "that would add to the long
line of recent films either shot in Illinois or about to be shot, including “The Dark Knight”, the upcoming John Dillinger film with Johnny Depp and Christian Bale, as well as a lot of other Hollywood films."
The American Jobs Creation Act Of 2004, the 2004 enactment of Section 181 of the
Internal Revenue Code of 1986 (the "Code") marked an unprecedented change in U.S. policy toward the phenomenon known as "Runaway Production".
Runaway Production refers to a film or television production that leaves one state or country to be filmed in another purely for economic reasons. This movement occurs
because producers tend to film in the location where they can minimize production costs through tax incentives, cheaper labor.
An individual or company who makes an investment into Section 181 qualified productions can take a 100% deduction of their investment against their passive
income in the year their investment was made.
But since Section 181 also allows for all other recourse debt costs which are usually associated with film finance, a $10 million dollar film, where only $3.5 million is equity, an investor can deduct $3.5 million dollars against the $10 million, especially if the latter is mezzanine or gap finance. Plus, an additional 20% in Illinois tax credits can be generated.
Regarding Section 181 as an alternative investment for hedge funds that want to offset their tax liabilities, Rutman adds "That I am redefining film finance that is more serving to the community, local economies, and people who need jobs. Plus, I have so many risk minimization strategies in place and several exit scenarios, there are a lot of hedge and private equity funds who are now starting to feel a bit shafted with their film fund deals simple because they did not do their homework."
Yuri Rutman’s Noci Pictures Entertainment is shooting a slate of films in Illinois using a hybrid of tax, finance, risk minimization and exit strategies that offer dollar for dollar Federal Tax Deductions and state income tax credits.
"I don’t know of any other alternative investment that can offer tax incentives, multiple exit strategies, as well as giving back to the local economy, while being involved with the moviemaking process, Rutman states, "that would add to the long
line of recent films either shot in Illinois or about to be shot, including “The Dark Knight”, the upcoming John Dillinger film with Johnny Depp and Christian Bale, as well as a lot of other Hollywood films."
The American Jobs Creation Act Of 2004, the 2004 enactment of Section 181 of the
Internal Revenue Code of 1986 (the "Code") marked an unprecedented change in U.S. policy toward the phenomenon known as "Runaway Production".
Runaway Production refers to a film or television production that leaves one state or country to be filmed in another purely for economic reasons. This movement occurs
because producers tend to film in the location where they can minimize production costs through tax incentives, cheaper labor.
An individual or company who makes an investment into Section 181 qualified productions can take a 100% deduction of their investment against their passive
income in the year their investment was made.
But since Section 181 also allows for all other recourse debt costs which are usually associated with film finance, a $10 million dollar film, where only $3.5 million is equity, an investor can deduct $3.5 million dollars against the $10 million, especially if the latter is mezzanine or gap finance. Plus, an additional 20% in Illinois tax credits can be generated.
Regarding Section 181 as an alternative investment for hedge funds that want to offset their tax liabilities, Rutman adds "That I am redefining film finance that is more serving to the community, local economies, and people who need jobs. Plus, I have so many risk minimization strategies in place and several exit scenarios, there are a lot of hedge and private equity funds who are now starting to feel a bit shafted with their film fund deals simple because they did not do their homework."
5 Feb 2008
Special Situations Mergers & Acquisitions Launch
In response to client needs and evolving capital markets conditions, Duff & Phelps Corporation announced the formation of a Special Situations Mergers & Acquisitions practice.
This group formalizes Duff & Phelps' long-standing expertise advising middle market companies, lenders, and private equity sponsors on transactions occurring in challenging operating and financial environments.
According to Dow Jones, private equity fundraising designated specifically for distressed investments topped $48 billion in 2007, a 300% increase in funds raised over the previous year.
"Hedge funds, sponsors and institutions are amassing large pools of capital for distressed investing, and they are scouring the market for investment opportunities," said Russell Belinsky, Senior Managing Director of Restructuring and co-founder of Chanin Capital Partners, which was acquired by Duff & Phelps in November 2006.
"Meanwhile, the credit crunch is putting a strain on companies and their ability to borrow. As a result, some of these companies will look to sell underperforming operations or assets to raise capital. This puts our Special Situations M&A practice in an ideal position to leverage our relationships and find natural buyers for these assets."
The announcement of a Special Situations M&A practice formalizes an existing service offering of Duff & Phelps. The specific services offered include merger and acquisition advisory services in situations where the target company or its owner is significantly underperforming or experiencing financial distress, including out-of court divestitures and Chapter 11 Section 363 asset sales, and private capital raising for refinancing or recapitalization in times of financial distress.
This group formalizes Duff & Phelps' long-standing expertise advising middle market companies, lenders, and private equity sponsors on transactions occurring in challenging operating and financial environments.
According to Dow Jones, private equity fundraising designated specifically for distressed investments topped $48 billion in 2007, a 300% increase in funds raised over the previous year.
"Hedge funds, sponsors and institutions are amassing large pools of capital for distressed investing, and they are scouring the market for investment opportunities," said Russell Belinsky, Senior Managing Director of Restructuring and co-founder of Chanin Capital Partners, which was acquired by Duff & Phelps in November 2006.
"Meanwhile, the credit crunch is putting a strain on companies and their ability to borrow. As a result, some of these companies will look to sell underperforming operations or assets to raise capital. This puts our Special Situations M&A practice in an ideal position to leverage our relationships and find natural buyers for these assets."
The announcement of a Special Situations M&A practice formalizes an existing service offering of Duff & Phelps. The specific services offered include merger and acquisition advisory services in situations where the target company or its owner is significantly underperforming or experiencing financial distress, including out-of court divestitures and Chapter 11 Section 363 asset sales, and private capital raising for refinancing or recapitalization in times of financial distress.
PIPEs & Opportunities For Hedge Fund Managers
On Febuary 15th, 2008, a reduction in the Rule 144 holding period for restricted shares of public companies will take effect. The holding period, which is being shortened from one year to six months, will result in billions of shares from thousands of companies becoming eligible for public resale on that day.
A new report by Restricted Stock Partners examines 300 transactions and 258 issuers, showing 66% of the issuers highlighted as having greater than three months of their average daily trading volume eligible for sale on Febuary 15th.
The report is based on research on companies that issued unregistered securities in connection with Private Investment in Public Equity (PIPE) deals during the affected period. Hedge funds are the primary investors in the affected shares (many of which are from PIPEs).
37% of affected issuers will have greater than one year of their average daily volume eligible for sale and one-third of affected issuers in the Report will have greater than 25% of their market capitalization eligible for sale on the same day.
“Hundreds of companies may see share amounts equal to 100 or more times their average daily trading volume available for sale on Feb. 15,” according to Barry E. Silbert, founder and CEO of Restricted Stock Partners. “While it is difficult to predict what impact this will have on share prices, investors will certainly want to be familiar with the companies that may be affected.”
The RSTN has already attracted more than 400 members, including global financial institutions, hedge funds, mutual funds and other institutional investors, who collectively manage over $200 billion in assets.
A new report by Restricted Stock Partners examines 300 transactions and 258 issuers, showing 66% of the issuers highlighted as having greater than three months of their average daily trading volume eligible for sale on Febuary 15th.
The report is based on research on companies that issued unregistered securities in connection with Private Investment in Public Equity (PIPE) deals during the affected period. Hedge funds are the primary investors in the affected shares (many of which are from PIPEs).
37% of affected issuers will have greater than one year of their average daily volume eligible for sale and one-third of affected issuers in the Report will have greater than 25% of their market capitalization eligible for sale on the same day.
“Hundreds of companies may see share amounts equal to 100 or more times their average daily trading volume available for sale on Feb. 15,” according to Barry E. Silbert, founder and CEO of Restricted Stock Partners. “While it is difficult to predict what impact this will have on share prices, investors will certainly want to be familiar with the companies that may be affected.”
The RSTN has already attracted more than 400 members, including global financial institutions, hedge funds, mutual funds and other institutional investors, who collectively manage over $200 billion in assets.
4 Feb 2008
2007's Most Generous Givers Generate Huge Numbers
BusinessWeek's annual ranking of 'Most Generous Givers' lists some of 2007's deepest pockets, although many of the donations also bought the renaming of the recipients projects.
Sixteen of the 50 philanthropists gave more than $100 million, while nine donated $200 million or more. The largest donation coming from Jon Huntsman, who gave over $700 million to the Huntsman Cancer Institute in Utah.
David Koch, a newcomer, donated $100 million for a cancer research center at Massachusetts Institute of Technology. Lorry Lokey gave a $74.5 million donation to the University of Oregon, bringing his total to $132 million so far.
George Soros, Bill and Melinda Gates, Michael and Susan Dell, were also high on the list of generous givers. T. Denny Sanford gave $400 million in a pledge to Sioux Valley Hospitals & Health System in South Dakota, renamed Sanford Health.
Robert Day gave $200 million to the Robert Day Scholars Program and Sandy and Joan Weill donated more than $300 million to Cornell University and its Weill Medical College, which focuses on stem cell research.
Sixteen of the 50 philanthropists gave more than $100 million, while nine donated $200 million or more. The largest donation coming from Jon Huntsman, who gave over $700 million to the Huntsman Cancer Institute in Utah.
David Koch, a newcomer, donated $100 million for a cancer research center at Massachusetts Institute of Technology. Lorry Lokey gave a $74.5 million donation to the University of Oregon, bringing his total to $132 million so far.
George Soros, Bill and Melinda Gates, Michael and Susan Dell, were also high on the list of generous givers. T. Denny Sanford gave $400 million in a pledge to Sioux Valley Hospitals & Health System in South Dakota, renamed Sanford Health.
Robert Day gave $200 million to the Robert Day Scholars Program and Sandy and Joan Weill donated more than $300 million to Cornell University and its Weill Medical College, which focuses on stem cell research.
RCB Launches Indian Office For High Net Worth Individuals
RBC announced that it has entered the Indian market by opening its first office in the financial hub of Bandra Kurla, Mumbai, in order to provide wealth management services to high net worth individuals and provide capital market services including global debt funding to Indian banks, corporations and financial institutions.
"The strong growth of the Indian economy presents huge opportunities," said Gordon M. Nixon, RBC president and chief executive officer. "RBC is committed to expanding outside North America into areas where we can show competitive strength and India is a natural choice for our strategy in Asia. India is showing an increasing demand for areas in which RBC has competitive strengths, infrastructure and project finance, energy, metals and mining, structured products, currency and bond trading, and wealth management services."
Akhauri Sinha, country head, RBC India, will lead RBC's overall operations in India, while Dipendarra J. Singh will lead RBC's wealth management business with a focus on high net worth individuals, and Vikas Jambotkar will focus on providing RBC services to Indian financial institutions, as well as capital markets services to corporations.
With people from India comprising the second highest Asian immigrant population in Canada after China, RBC is now well positioned to help them invest back into India's buoyant economy. "Indo-Canadians have made and continue to make a huge contribution to the fabric of Canadian life. Their presence and cosmopolitan imprint on our cities, especially Toronto and Vancouver, have been profound. They form an important, indeed critical, link between India and Canada," continued Mr. Nixon.
RCB (The Royal Bank of Canada) serves more than 15 million personal, business, public sector and institutional clients throughout offices in Canada, the U.S. and 36 other countries.
"The strong growth of the Indian economy presents huge opportunities," said Gordon M. Nixon, RBC president and chief executive officer. "RBC is committed to expanding outside North America into areas where we can show competitive strength and India is a natural choice for our strategy in Asia. India is showing an increasing demand for areas in which RBC has competitive strengths, infrastructure and project finance, energy, metals and mining, structured products, currency and bond trading, and wealth management services."
Akhauri Sinha, country head, RBC India, will lead RBC's overall operations in India, while Dipendarra J. Singh will lead RBC's wealth management business with a focus on high net worth individuals, and Vikas Jambotkar will focus on providing RBC services to Indian financial institutions, as well as capital markets services to corporations.
With people from India comprising the second highest Asian immigrant population in Canada after China, RBC is now well positioned to help them invest back into India's buoyant economy. "Indo-Canadians have made and continue to make a huge contribution to the fabric of Canadian life. Their presence and cosmopolitan imprint on our cities, especially Toronto and Vancouver, have been profound. They form an important, indeed critical, link between India and Canada," continued Mr. Nixon.
RCB (The Royal Bank of Canada) serves more than 15 million personal, business, public sector and institutional clients throughout offices in Canada, the U.S. and 36 other countries.
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