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20 Mar 2009

Febuary Hedge Fund Performance

Morningstar reported a sharp decline in credit and equity markets as the U.S. government announced its stimulus package and financial stability plan. February saw a huge sell-off in U.S. and European bank stocks caused by concerns of financial health and nationalization.

U.S. bank stocks hit a 17-year low and spreads on corporate bonds widened, according to the report.

"Hedge fund managers, like other investors, are nervous about the efficacy and unpredictability of government involvement in the economy. They just don't know what the U.S. government will do next, and this uncertainty is wreaking havoc in the markets," said Nadia Papagiannis, Morningstar hedge fund analyst.

Widening spreads hurt hedge funds that invest in distressed debt, as lower-quality credits became cheaper. The Morningstar Distressed Securities Hedge Fund Index was one of the worst-performing category indexes, falling 4.1%. The Morningstar MSCI Specialist Credit and Relative Value Hedge Fund Indexes fell only 0.5% and 0.1%, respectively, as some areas of the credit market, such as leveraged loans, performed better than others.

Global non trend funds, those that make macro-economic bets, and global trend funds, those that bet on price trends in commodity and financial futures, showed mixed results in February. These funds took advantage of the rise in gold and the depreciation of the Japanese yen against the U.S. dollar, but volatility in other commodities such as oil caused declines.

1 comment:

TR said...

Dominick & Dominick LLC announces Consulting Arrangement and expansion of its Merger Arbitrage/Event-Driven team.

March 30, 2009

Dominick & Dominick LLC is excited to have entered into a consulting arrangement with Steven M. Cohen. Steven has spent more than 25 years on the buyside specializing in merger arbitrage, first as an analyst and then for two decades as a portfolio manager. During that period, his institutional investors included high net-worth individuals, endowments, foundations, and pension funds. For ten years Steven served as the Chief Investment Officer of a New York-based multi-strategy hedge fund.

Dominick & Dominick LLC is also pleased to announce the expansion of its Merger Arbitrage/Event-Driven Team by the hiring of Tony C. Reiner. Tony has focused on merger arbitrage and event-driven investing since 1996. Tony previously co-founded D/R Asset Management, an event-driven focused hedge fund which was later merged into Harbert Management. Tony most recently held positions as Senior Analyst and Portfolio Manager at Richmond Capital.

Tony will be joining Jonathan S. Van Orden, Richard Hansen and Eric S. Marzucco of the Merger Arbitrage/Event-Driven team at Dominick & Dominick LLC.

About Dominick & Dominick:

"Dominick & Dominick LLC, founded in 1870, is a historic name on Wall Street and one of the early firms to join the NYSE. Dominick & Dominick LLC is a full service securities firm offering wealth management, investment advisory and investment banking services to individual and institutional clients. Dominick & Dominick LLC is a member of FINRA/SIPC."

Contact: Jonathan S. Van Orden, Managing Director – Institutional Trading (212) 558-8894.