Hedge Fund Manager Survey Finds Sentiment Moving Against Europe, in Favor of U.S.

New York (HedgeCo.net) - Investors have recovered their bullishness towards equity markets but are shifting their focus away from Europe and into the U.S. and Japan, according to the BofA Merrill Lynch Survey of Fund Managers for March.

A total of 207 fund managers, managing a total of US$589 billion, participated in the global survey from 5 March to 11 March. A total of 165 managers, managing US$403 billion, participated in the regional surveys.

After weakened sentiment in February, the survey shows that investors have restored their faith in equities with a net 46 percent of asset allocators saying they are overweight the asset class, up from 33 percent the previous month. Cash positions have fallen with respondents at a net neutral cash allocation compared with a net 12 percent underweight in February.

Asset allocators have retrenched from Europe, however. A net 21 percent are underweight European equities this month, up sharply from a net 2 percent overweight in January.

The change in favor of U.S. equities has been similar. A net 19 percent of asset allocators are overweight U.S. equities this month, up from just 1 percent in January. Japan is also regaining popularity. A net 6 percent of allocators are overweight Japanese equities, the most bullish reading since August 2007, and up from a net 10 percent underweight in January.

Global investors believe that the corporate outlook is better away from Europe. A net 40 percent of the panel says the outlook for eurozone corporate profits is the least favorable of all regions.

"Investors' concerns about Greece are easing, but European country risk remains a key constraint to optimism over economic recovery," said Gary Baker, head of European Equities strategy at BofA Merrill Lynch Research. "Investors are more willing to embrace corporate risk, via equities, than sovereign risk," said Michael Hartnett, chief Global Equities strategist at BofA Merrill Lynch Research.

The net number of European fund managers predicting growth in their own economy over the coming 12 months has fallen to 45 percent, down from 72 percent in January, according to the Regional Fund Manager Survey. While European sentiment might have been expected to weaken, a similar fall in optimism is also evident among U.S. investors. A net 43 percent forecast growth in the American economy over the next 12 months, down from a net 76 percent in January.

Investors in both regions have stronger belief in earnings growth. A net 60 percent of European respondents predict improved earnings in the coming 12 months, an increase of 11 percent on February. Their colleagues in the U.S. are more positive with a net 72 percent forecasting earnings growth, up from a net 52 percent in February.

U.S. and European investors have significantly scaled back their cash allocations. A net 9 percent of the European panel is overweight cash this month, down from 26 percent in February. The corresponding numbers for U.S. investors are a net 8 percent in March and 19 percent in February.

European respondents have increased exposure to cyclical sectors, including Basic Resources and Construction. They have reduced their underweight position on banks. US investors have also increased exposure to cyclicals, such as Industrials and Materials, but have extended their underweight positions in Banks.

SEC Charges Texas Hedge Fund Adviser With Fraud

HedgeCo News - The SEC has filed a federal case against hedge fund advisor Stephen X. Kim and Spyglass Management, L.P. for their roles in allegedly defrauding Spyglass Capital Partners, L.P., a hedge fund managed by Kim through Spyglass. according to court filings.

The SEC complaint, filed in Texas, alleges that between in 2004 and 2006, Kim and Spyglass raised approximately $4.7 million from investors located primarily in Houston, Texas using offering materials that contained misleading information relating to Kim's education, business experience, and compensation.

The SEC alleges that Kim and Spyglass failed to employ any hedging strategy to manage risk, causing the hedge fund to loose over $2 million then directing the hedge fund to make approximately $1.7 million in Ponzi payments to investors.

Finally, the SEC alleges that Kim misappropriated approximately $1.5 million of the hedge fund's remaining assets to repay several outstanding personal obligations.

Without admitting or denying the allegations, Kim and Spyglass have made a settlement with the SEC, which is subject to the approval of the United States District Court for the Southern District of Texas.

SSARIS Wins Fund of Hedge Fund Award

HedgeCo News - Hedge fund and FoHF manager, SSARIS Advisors, LLC, won the "Global Multi-Strategy ($500 million -$1 billion) over 3 years" award at the annual InvestHedge FoHF Awards ceremony held last night in New York City. SSARIS won in the Multi-Manager Absolute Return Strategy category.

To qualify, all funds of funds must provide a strategy allocation breakdown for each fund nominated. InvestHedge has the final say in which category a fund is nominated. Winners are decided using an established methodology based on a combination of Sharpe ratios and returns over the relevant time period.

SSARIS Advisors, LLC is a majority-owned subsidiary of State Street Global Alliance, LLC. SSARIS Advisors, LLC was founded in 2001 and is directed by Mark Rosenberg, Chairman and CIO; Peter Hinrichs, CFO and Chief Compliance Officer; and Jim Tomeo, COO and Senior Portfolio Manager.

With $1.9 trillion in assets under management, State Street Global Advisors has investment centers in Boston, Hong Kong, London, Montreal, Munich, Paris, Singapore, Sydney, Tokyo, Toronto and Zurich, and offices in 26 cities worldwide.

UCITS Hedge Fund Strategy Index up 0,93% in first two weeks of March

HedgeCo News - The UCITS Hedge Fund Strategy Index gained 0,93% within the first two weeks in March 2010, every strategy except fixed income and market neutral were positive, Global macro not only being the most successful strategy in 2010 but also in March with gains of 2,85% so far.

The other most successful strategies in March are convertible (+1,75%), CTA (+1,70%) and L/S equity (+1,54%), the latter turning positive ytd for the first time.

The UCITS HFS Index Series is the first index family that tracks all UCITS funds using hedge fund strategies. The UCITS HFS Index Series includes all UCITS III funds that apply absolute return strategies, have more than 10 Million Euros of assets under management, offer at least weekly liquidity and have reported numbers for more than one month. Index tracking funds, long-only and 130/30 strategies are excluded.

The indices are calculated on every 5th, 10th and 15th business day and at the end of each month by the index calculator Structured Solutions AG.

There have been 8 UCITS hedge fund launches since January 2010.

New Ticonderoga Launch As Hedge Funds Embrace ETFs

HedgeCo News - Institutional broker dealer, Ticonderoga Securities has launched an exchange traded funds (ETF) desk, led by industry veteran William Bauer. Bauer joins Ticonderoga with more than 18 years of institutional equity and derivative sales and trading experience, with five years focused on ETFs.

“Hedge funds and money managers are increasingly embracing ETFs as a superior product with greater transparency and liquidity,” said Bauer. “As this continues, Ticonderoga will be positioned well for growth.”

The new group will specialize in market making capabilities for institutional investors moving in and out of ETFs. The team will also advise clients on portfolio-trading issues, provide analysis and strategy, and assist in order execution through strong collaboration with the firm’s Sales & Trading Desk. As head of the ETF Desk, Bauer will focus on building out the ETF platform over the next several months, adding support staff, assistant traders and sales traders focused on ETF sales.

Bauer comes to Ticonderoga from Knight Capital, where he was a Director in ETF sales and trading. Before that, he was Vice President in sales and trading on the ETF market-making desk at Newedge Financial LLC, and also served as Vice President in sales and trading at RBC Capital Markets. Bauer attended University of Hartford with a focus on economics and finance.

Hedge Funds Leaders Forum 2010

The Hedge Funds Leaders Forum 2010, "Generating Alpha in Challenging Times", is being held March 18th, in New York City. The GoldenNetworking.com event will review recent performance of multi-strategy hedge funds, at panel "Generating Market-Beating Returns Under the Watchful Eye of the SEC".

Dow Jones reported: "The average hedge fund lagged behind the nearly 3% return of the Standard & Poor's 500 Stock Index return in February. The hedge funds that beat the market tended to be multi-strategy, according to both hedge fund databases and fund managers' letters to investors. Daniel Loeb's Third Point Offshore fund was up 3.2% for February and 6.9% for the year through February, according to HSBC Private Bank; the fund is multi-strategy."

Panelists, speakers and sponsors are invited to contact the organizers by sending an email to info@goldennetworking.com.

Hedge funds up 0.52% in February

New York (HedgeCo.net) - Hedge funds returned to positive territory in February 2010 according to a preliminary Eurekahedge report. There were approximately 90 hedge fund launches globally in 1Q2010. With arbitrage hedge funds delivering 15 consecutive months of positive returns, gaining 26.23% since November 2008.

Hedge fund returns across most regions were marginally positive for February; however, early reports showed that North American managers, who make up 65% of the hedge fund universe, posted impressive gains of 1.41%. Regional managers capitalised on the marked improvements in market sentiment on the back of some strong earnings reports, positive movements in the US dollar and commodities as well as improved manufacturing data and the Fed’s decision to maintain low interest rates

Latin American funds were also positive with a 0.48% returns in February while Asia ex-Japan and Japan funds returned nominally positive performances. Continued problems in the eurozone led to negative results by the region’s managers, who were down 0.66% in February as the euro weakened amid speculation of Greece’s sovereign debt default.

The composite Eurekahedge Hedge Fund Index gained 0.52% during the month as the underlying global markets posted a recovery from a disappointing January. The MSCI World Index was up 1.23% in February, bringing its YTD figure to -3.01%.

The Eurekahedge CTA/Managed Futures Hedge Fund Index was up a strong 1.27% during the month. Continued low interest rates in the US also helped managers in the bonds sector to deliver yet another month of positive results. Fixed income, arbitrage and relative value hedge funds were all up during the month while distressed debt managers were flat to slightly negative.

Minnesota Hedge Fund Manager Petters May Face Double Madoff Term

HedgeCo News - U.S. prosecutors yesterday recommended a sentence of 335 years in prison for hedge fund founder Thomas Petters, more than twice the term given to Bernard Madoff, according to Bloomberg. Petters was charged with mail and wire fraud, money laundering and obstructing justice.

A federal judge in Minneapolis ordered Petters to be held without bail in October 2000, after a taped phone conversation revealed that the disgraced entrepreneur planned to leave the country.

Petters and his hedge fund, Petters Group Worldwide LLC was convicted in December 2000, of all 20 criminal counts, adding up to a $3.5 billion fraud.

“The defendant’s fraud is staggering and unprecedented in size and impact on victims and the community,” prosecutors said, according to Bloomberg.

The case is U.S. v. Thomas Joseph Petters, U.S. District Court, District of Minnesota. The final sentencing is set for April 8th.

2010 Top Hedge Fund Firm Launches

Via HedgeTracker
Name		Style	Estimated Assets at Launch $mm	Location
AE Capital Management		Global Macro	10	Singapore
Astenbeck Capital Management		Commodities Focused	1,400	Westport, CT
Black’s Link Capital Ltd		Event-Driven	NA	Central Hong Kong
Castle Hill Asset Management		Fixed Income	2,150	London
Doubloon Capital LLC		Distressed	NA	Norwalk, CT
Edward Hornstein LLC		Long/Short Equity	10	New York, NY
Munsun Asset Management		Asian Equities	NA	China
Nautical Capital Management		Commodities Focused	NA	Purchase, NY

The Hedge Fund Fraud Casebook - Review

New York (HedgeCo.net) - Research and Markets has added John Wiley and Sons Ltd's new report "The Hedge Fund Fraud Casebook" to their offering. An in-depth look at the first 100 cases of proven fraud at hedge funds.

Some highlights:

* First comprehensive survey of hedge fund fraud including 100 chronological fraud cases
* Includes descriptions of each case, diagram of the player interaction, and tables detailing monies recovered, fines paid, prison terms, and professional sanctions
* Useful for both individual and professional investors, particularly given the last eighteen months of fraud and mismanagement among leading financial professionals and companies

Author Bruce Johnson spent more than a decade as a hedge fund practitioner, managing and advising funds. He was CEO of Albourne America LLC, the U.S. arm of Albourne Partners, a hedge fund advisory firm based in London. While at Albourne, Johnson researched new approaches to hedge fund due diligence including the quantitative analysis of "fund failure" and hedge fund credit.

After an earlier career as an architect and city planner in New York and London, Johnson has gained twenty-four years worth of experience in finance, including extended postings in Tokyo, Hong Kong, and London. While head of Global Research for Baring Securities, he published an important paper on the future of the Chinese and Indian economies, correctly predicting their current impact on global trade, and also created and managed the first investable global emerging markets equity index.

Maples Launches Luxembourg Hedge Fund Administration Services

Independent hedge fund services provider, Maples Finance, has expanded its European service offering in Luxembourg following the approval of its Registrar Agent license by Luxembourg’s financial supervisory authority, the Commission de Surveillance du Secteur Financier.

"We are delighted to broaden our capabilities in Luxembourg, where we have acted as a licensed Domiciliation Agent since 2007." Maxine Rawlins, CEO of Maples Finance, said," As we begin to see recovery in global markets, Maples Finance is well positioned to deliver seamless services to our clients both in Luxembourg and globally."

Maples Finance services $30 billion in investment fund net assets from its worldwide network of offices in financial centres including Canada, Dubai, Dublin, Luxembourg, Hong Kong, and the Cayman Islands.

Hedge Fund Regulation Certification Launch

The Ireland-based Hedge Fund College has announced the launch of its Certificate in Hedge Fund Regulation, the first regulatory certification in the hedge fund industry.

“Never has it been more important for the hedge fund industry to demonstrate a greater regulatory awareness." Thomas Bullman, founder of the Hedge Fund College, said, "Both European and US regulatory proposals will have far-reaching effects. Everybody within the hedge fund industry has an obligation to ensure that they are sufficiently educated on how these new measures will impact them. The Hedge Fund College aims to provide a broad certification that a candidate has demonstrated an understanding of hedge fund regulation and current issues.”

The Certificate in Hedge Fund Regulation provides a broad-based curriculum in hedge fund regulation, delivered online by distance learning.

Sponsored by The Hedge Fund Society and its international advisory board of academics and commercial practitioners, the course provides an introduction to hedge funds, their history and the regulatory issues surrounding them. The course also provides a review of regulatory theory and analysis of the regulation of hedge funds, hedge fund managers, hedge fund service providers and hedge fund standards in the UK, EU and US.

NY Hedge Fund Manager Nadel Pleads Guilty in Ponzi Scheme

HedgeCo News - Former hedge fund manager Arthur G. Nadel has pled guilty to 15 counts of securities fraud, mail fraud, and wire fraud, the US attorney for the southern district of New York said.

The indictment claims that from 1999 through January 2009, Nadel perpetrated a Ponzi scheme to defraud investors in six different investment funds, consistently loosing money and using his investor money to fund his lifestyle and several businesses, including a real estate project in North Carolina, his wife's flower shop, and his purchase of several private planes.

From 1999 through January 2009, nearly 250 people invested more than $397 million with the Funds. NADEL received tens of millions of dollars in management fees and performance incentive fees. As a result of Nadels's Ponzi scheme, investors suffered losses of approximately $162 million.

The hedge fund manager pleaded guilty to six counts of securities fraud, one count of mail fraud, and eight counts of wire fraud, and faces a maximum penalty of 20 years in prison on each of the counts.

Nadel faces a maximum fine of the greater of $5 million or twice the gross gain or loss from the offense. For the mail fraud and wire fraud charges, he faces a maximum fine of the greater of $250,000, or twice the gross gain or less from the offense.

UCITS 3 Hedge Funds Index Launch

HedgeCo News - Geneva based hedge fund advisory company, NARA Capital, announced plans to release its UCITS Alternative Index® to the public. A series of indices aims to track the performance UCITS hedge funds and funds of funds.

”NARA has been tracking the emergence of UCITS hedge funds for more than two years and has constructed and developed what is probably the most comprehensive database of that universe." Louis Zanolin, Partner at NARA Capital said, "The trend for more regulated and liquid alternative strategies will increase the demand for UCITS alternative funds over the coming year, so will the need for independent comparative tools. We have therefore decided to publicly release the index performance.”

The UCITS Alternative Index® series are equally weighted. The performance for any particular month will accessible on the UCITS Alternative Index® website www.ucits-alternative.com generally on the 5th business day of the following month. The inception date of the index is 1st January 2008.

As of February 2009 the UCITS Alternative Index® was tracking close to 400 UCITS hedge funds and funds of hedge funds totaling more than 63 billion EUR assets under management. Only funds pursuing hedge fund like strategies are taken into account for the index calculation. Absolute return funds with no shorting capabilities as well as 130/30 and passive hedge funds index UCITS funds are excluded from the
index.

In 2009, the UCITS Alternative Index® Global returned +9.27% while the UCITS Alternative Index® Fund of Funds returned + 1.64%.

With +34.68%, the UCITS Alternative Index® Emerging Markets was the best performing strategy in 2009.

It was followed by the UCITS Alternative Index® Fixed Income which returned +11.83%. The least performing index in 2009 was the UCITS Alternative Index® Equity Market Neutral with a -0.57%.

At the end of January 2010, Macro hedge funds represented the largest assets under management with 27.3 billion EUR ($ 36.9 billion). It was followed by Fixed Income and Long/Short Equity Funds with respectively 26.7 and 20.7 billion EUR ($36.1 and $28 billion). In term of jurisdiction, 48% of the funds were based in Luxemburg, 20% in Ireland 17% and in France.

Hennessee Group: Hedge Fund Performance

HedgeCo News - Hedge fund consultant, Hennessee Group LLC, conducted a study examining the correlation between the breadth of equity market moves and the performance of long/short equity hedge funds relative to traditional indices.

Through this study, the Hennessee Group confirmed that hedge funds generally lag their traditional counterparts when the equity markets experience strong advances and winners greatly outnumber losers as witnessed in 2009. Conversely, when the markets experience a more balanced move or a meaningful move to the downside, hedge funds generate significant alpha on a relative basis.

“Hennessee Group research indicates that in market advances where winners outnumber losers by more than 3 to 1 (breadth ratio of 3.0), hedge funds generally struggle to differentiate themselves as performance is strongly driven by momentum (beta) as opposed to strong stock selection (alpha),” stated Mr. Gradante, Managing Principal of Hennessee Group . “During such strong, broad based gains, hedge funds have a particularly difficult time identifying good shorting opportunities as there can be a disconnect between fundamentals and stock performance. Therefore, short positions generally serve as a drag on performance in these markets.”

Ratio of Winners to Losers Historically a Strong Indicator of Relative Performance

The Hennessee Group evaluated the performance of the Hennessee Long/Short Equity Index against the S&P 500 Index while also taking into consideration the breadth of the equity markets each calendar year period dating back to 1983. Over these twenty three calendar year periods, the Hennessee long/short equity index underperformed the S&P 500 Index ten times. During nine out of those ten calendar year periods, the Hennessee Group found that the S&P 500 Index experienced at least 3 times the number of winners than losers (the lone exception we observed was 1998 when Long-Term Capital Management meltdown which caused distress in the hedge fund industry). To illustrate, in 2009, 425 of the S&P 500 Index constituents experienced gains while 73 experienced losses. With over five stocks up for every one stock down for the year, hedge fund managers found it very difficult to successfully add value with strong selection, particularly on the short side. The most profitable portfolio strategy in such an environment was to increase net exposure and lever the portfolio to benefit from the beta driven market. That said, while hedge funds generally lagged in such beta driven environments, they still managed to perform well as the Hennessee Long/Short Equity Index generated positive returns each calendar year, with double digit gains in eight of the ten.

The remaining 13 calendar year periods when the Hennessee Long/Short Equity Index outperformed the S&P 500 Index, the market moves were more generally balanced with a breadth ratio consistently less then three; providing long/short equity managers with a greater opportunity set to generate alpha on both sides of their books. Of particular note is 1999 when the S&P 500 Index experienced a strong +20% gain. Despite the strong equity rally, hedge funds managed to outperform the traditional index as the breadth of the move was more evenly balanced relative to other equity market rallies (breadth ratio of 1.06) allowing managers to generate alpha through strong stock selection. During other calendar year periods with low breadth ratios, hedge funds generated double digit alpha relative to the index irrespective of market direction.

2010 Outlook

In January, the S&P 500 Index declined -3.7% with 133 issues up and 366 issues down. Consistent with the results over the last 23 years, the breadth ratio of 0.4 proved favorable to hedge funds on a relative basis as the Hennessee Long/Short equity Index outperformed the S&P 500 by 280 basis points. A distinguishing factor between hedge funds and traditional equity investing in January was the ability to generate alpha with short positions and market hedges. The greater the universe of shorting opportunities, the greater the likelihood hedge funds will outperform their traditional counterparts, particularly during market downturns.

“In 2009, hedge funds most willing to take on greater net long exposure and bought high beta stocks were most rewarded while those funds that remained defensively positioned, with low net long exposure and an emphasis on fundamentals, generally lagged” said Mr. Gradante. “We believe 2010 will be different. We anticipate greater dispersion among sectors and stocks and a more balanced advance/decline ratio as fundamentals come into main focus again.”

Hedge Fund Fraud Case Postponed Till After Civil Suit

HedgeCo News - The date has been set for hedge fund founder Raj Rajaratnam's criminal suit, New York Judge Richard Holwell has delayed it till Oct. 25, 2010. "Ensuring a full opportunity for both sides to litigate all the issues," the court document read.

Prosecutors said the hedge fund manager would have an unfair advantage if a civil trial by market regulators went ahead before a criminal trial, Reuters reported. However, the Galleon team won the right to postpone the trial. The civil lawsuit is scheduled for August 2, 2010.

Rajaratnam is being accused of insider trading and securities fraud, generating as much as $49 million in profit.

Reuters says the majority of the stocks are in technology, including, IBM, Intel, Akamai Technologies Inc, Polycom Inc, Hilton Hotels Corp, Google Inc, Sun Microsystems Inc SUNW.TI, Clearwire Corp, Advanced Micro Devices, ATI Technologies Inc and eBay Inc.

Rajaratnam could face a sentence of up to 185 years, if convicted.

Capital Introduction Trends Affecting the Hedge Fund Industry

HedgeCo News - New York based institutional investment research company, Carbon 360, conducted a survey of third party marketers as well as capital introductions groups titled “Capital Introduction Trends in 2010”, to investigate the most sought after strategies, sourcing trends and due diligence concerns while asking how the industry might evolve over the next five years.

The survey showed that the investor base is now dominated overwhelmingly by institutions, family offices, and pension funds. Investors have also developed a taste for Global strategies in addition to traditional long/short funds, the survey found.

While performance remains a primary concern, transparency and risk management have grown to become critical concerns for investors.

“As hedge funds go, so goes the capital introduction industry.” Evan Rapoport, CEO of HedgeCo Securities LLC, said. “In that mode of thought, transparency and risk management are the popular trends. “If we can work with regulators to legitimize the industry and overcome the scandalous actions of a select few, I am all for it. This will be a major theme ongoing.”

“I expect institutional investors to be more receptive to newer managers, fee structures to remain stable, and foreign investors to invest more in the US and vice versa.” Rapoport said, “Europe should lose market share to Asia, and new markets will open up as countries move from developing markets to developed markets. Proprietary trading and hedge funds owned by large US banks will most likely weaken or disappear under the current administration and, more importantly, current US economy sentiment, leading to opportunities for independent investment management companies. Overall, I expect 2010 to build on the strength of the latter half of 2009.”

“When reviewing this year’s survey, the downward trend in assets does appear to be slowing, with some firms actually reporting slight increases in capital from the Q3 2009 forward.” Brian Shapiro, President of Simplify LLC, a portfolio management company, said, “Our hopes are that this data shows that the flight of capital and negative return trends of the past 24 months are now coming to an end, and the funds can utilize the lessons learned during these difficult times to continue supporting the process of hedge fund evolution from, opaque black-box, to transparent and liquid financial products.”

Galleon Hedge Fund Case Wins Temporary Reprieve

HedgeCo News - Hedge fund founder Raj Rajaratnam won an emergency order relieving him from having to turn over wiretap recordings in the SEC v Galleon case, according to a Reuters report.

Because of legal hurdles in obtaining the 14,000 wiretap intercepts, the SEC was seeking it from Rajaratnam and his co-defendant, Danielle Chiesi.

Rajaratnam’s lawyer last month attacked the U.S. government’s wiretap evidence saying he would file a motion to suppress the telephone recordings which were used to arrest Rajaratnam and more than a dozen other people in the Galleon raid.

The temporary stay was granted late yesterday by U.S. Court of Appeals, Reuters said. The reprieve came just two days after a U.S. District Court Judge ordered the deadline of Feb. 15 for Rajaratnam and Chiesi to surrender the recordings to the SEC.

Rajaratnam and Chiesi are being accused of insider trading and securities fraud, enabling the pair to generate $49 million in profit.

Reuters says the majority of the stocks are in technology, including, IBM, Intel, Akamai Technologies Inc, Polycom Inc, Hilton Hotels Corp, Google Inc, Sun Microsystems Inc SUNW.TI, Clearwire Corp, Advanced Micro Devices, ATI Technologies Inc and eBay Inc.

A civil lawsuit is scheduled for August 2, 2010. The prosecution has also indicted Rajaratnam on criminal charges.

Judge Upholds 'Terminator' Sale To Hedge Fund

HedgeCo News - The U.S. Bankruptcy Court in Los Angeles has agreed to uphold the hedge fund Pacificor's purchase of the 'Terminator' franchise rights from Halcyon Holding Group LLC, The Wall Street Journal reports.

Halcyon Holdings had accepted a deal from hedge fund Pacificor on Tuesday after a five-hour auction, according to a reports.

The Terminator rights were sold for $29.5 million, following a legal battle in which Halcyon Holding was forced to file for bankruptcy, the case was started by the hedge fund which won the bidding wars, Pacificor.

Columbia Pictures Industries Inc. and Lions Gate Films Inc.'s final offer was $28.5 million, plus $5 million for each of the first three sequels, but eventually the team lost out to the frenetic bidding of the hedge fund.

"We're very pleased," hedge fund attorney David B. Shemano said in an interview with The Wall Street Journal.

"Not only did Halcyon receive the green light to sell the "Terminator" rights to Pacificor but the production company was finally able to resolve a dispute it had with the hedge fund during the sale process," Shemano said.

Rajaratnam & Chiesi Charged With a Superseding Indictment

HedgeCo News - Raj Rajaratnam and Danielle Chiesi Federal have been accused with a 19-count superseding indictment by Federal prosecutors yesterday, Courthouse News Service reported.

A superseding indictment is an indictment that is filed subsequent to an original indictment. It is usually based upon supervening events that logically change the nature of the original indictment.

The superseding indictment is based on guilty pleas from Anil Kumar and Mark Kurland, the Courthouse reported.

The government is claiming Rajaratnam and Chiesi made millions of dollars for themselves and their hedge funds by trading on inside information about Intel, IBM, Akamai Technologies, Polycom, Hilton Hotels Google, Sun Microsystems, Clearwire Corp., Advanced Micro Devices, ATI Technologies, eBay, and PeopleSupport.

The investigation started with suspicions in the 1990s when chip maker Intel Corp alleged that Rajaratnam was receiving tips from an Intel insider. The investigation was based on a witness who had first entered into a plea agreement with the United States before she began to cooperate in an investigation into Rajaratnam’s practices.

Rajaratnam was taken into custody in New York on Oct. 16, 2009 in the USA’s largest hedge fund insider-trading scheme. His bail was set at $100 million.