Approximately 80% of the world's hedge funds are believed to be domiciled in the Cayman Islands. As a result, Cayman Islands hedge fund companies and service providers, such as law firms, accounting firms, and administrators, are employing innovative recruiting techniques to attract and retain professionals.
Some representatives from Cayman-based firms, such as Maples and Calder, KPMG, and Walkers, are talking from their own experience about the new topics on the Cayman agenda, such as onshore vs. offshore employment, how working in offshore financial centers seem to be a preferred career move for hedge fund professionals.
Incentives such as weather and lifestyle are attracting employees to the Caymans, a sophisticated work and family support system encourages them to stay. There have also been recent programs set up by the Cayman private sector firms, aimed at employing local citizens to work in the financial sector.
Hedge funds returned some 13% in 2006, compared with the 15.8% return of the S&P 500 Index, according to industry tracker Hedge Fund research, Inc. of Chicago.
Email me or leave a comment if you want more info on contacting these people, the hedge funds listed above have offered to speak or give advice on moving to the Caymans.
27 Mar 2007
British Hedge Funds Back Up TCI In Dutch Bank Attack
ABN Amro Holding NV said last week it was in preliminary discussions with Barclays about creating a company worth more than $160 billion, this comes after pressure from activist hedge fund TCI asking to split up of the Dutch bank.
Activist hedge funds Polygon and Centaurus are said to be supporting TCI's demands and have also built a stake in ABN in order to pressure the bank into the sale.
The Children's Investment Fund Management(TCI), a $3.8 billion hedge fund, announced in a letter to Dutch bank ABN AMRO last month that they believe the bank is undervalued and should sell some of its assets, merge with another bank, or even sell off the whole business.
In 2005 TCI was part of a group of activist investors who criticized Deutsche Börse for its $2.5 billion bid for the London Stock Exchange, eventually causing Werner Seifert, the chief executive to resign. It turns out TCI, which owned 8% of Deutsche Börse, actively recruited some powerful partners, including Atticus Capital, Merrill Lynch, and Fidelity Investments, in order to facilitate the move. Centaurus is one of the activist shareholders that was embroiled in a dispute with Dutch companies Stork NV and Royal Ahold NV last year, and Polygon Investment Partners is a British equity fund that was involved in the sale of Dutch publisher VNU.
TCI said, "We believe that this strategy would not only create significant shareholder value but also would best serve all the stakeholders who otherwise would suffer over the long term from the structurally declining competitive position of ABN AMRO,......In 2006 they again committed to cut costs and they have so far failed to deliver," the hedge fund said.
Activist hedge funds Polygon and Centaurus are said to be supporting TCI's demands and have also built a stake in ABN in order to pressure the bank into the sale.
The Children's Investment Fund Management(TCI), a $3.8 billion hedge fund, announced in a letter to Dutch bank ABN AMRO last month that they believe the bank is undervalued and should sell some of its assets, merge with another bank, or even sell off the whole business.
In 2005 TCI was part of a group of activist investors who criticized Deutsche Börse for its $2.5 billion bid for the London Stock Exchange, eventually causing Werner Seifert, the chief executive to resign. It turns out TCI, which owned 8% of Deutsche Börse, actively recruited some powerful partners, including Atticus Capital, Merrill Lynch, and Fidelity Investments, in order to facilitate the move. Centaurus is one of the activist shareholders that was embroiled in a dispute with Dutch companies Stork NV and Royal Ahold NV last year, and Polygon Investment Partners is a British equity fund that was involved in the sale of Dutch publisher VNU.
TCI said, "We believe that this strategy would not only create significant shareholder value but also would best serve all the stakeholders who otherwise would suffer over the long term from the structurally declining competitive position of ABN AMRO,......In 2006 they again committed to cut costs and they have so far failed to deliver," the hedge fund said.
26 Mar 2007
Asian Regulators Discuss Hedge Funds
About 40 securities regulators from around Asia and the Pacific are meeting this week to discuss hedge funds.
The regional seminar on Collective Investment Schemes/Hedge Funds is taking place in Beijing today through the 30th as part of the APEC Financial Regulators Training Initiative. The regulators are coming from India, Indonesia, Malaysia, Pakistan, Singapore, Thailand and the People's Republic of China.
Min Tang, Deputy Country Director and Chief Economist for ADB's office in Beijing said "It is important to strengthen financial regulation in the region through these cost-effective programs for bank supervisors and securities regulators."
"On behalf of the China Securities Regulatory Commission, I welcome the opportunity" said Dr. Sun Jie, Director General of the commission's Department of Fund Supervision. "It presents a forum for regulators to discuss and learn from the expertise of developed countries like the United States and Australia, which have been developing their regulatory framework for Collective Investment Schemes over many years."
In May 1998, the APEC Finance Ministers Meeting endorsed the establishment of the APEC Financial Regulators Training Initiative to enhance training efforts for national and regional financial regulators within Asia.
ADB, based in Manila, is dedicated to reducing poverty in the Asia and Pacific region through pro-poor sustainable economic growth, social development, and good governance. Established in 1966, it is owned by 64 members - 46 from the region. In 2005, it approved loans and grants for projects totaling $6.95 billion, and technical assistance amounting to $198.8 million.
The regional seminar on Collective Investment Schemes/Hedge Funds is taking place in Beijing today through the 30th as part of the APEC Financial Regulators Training Initiative. The regulators are coming from India, Indonesia, Malaysia, Pakistan, Singapore, Thailand and the People's Republic of China.
Min Tang, Deputy Country Director and Chief Economist for ADB's office in Beijing said "It is important to strengthen financial regulation in the region through these cost-effective programs for bank supervisors and securities regulators."
"On behalf of the China Securities Regulatory Commission, I welcome the opportunity" said Dr. Sun Jie, Director General of the commission's Department of Fund Supervision. "It presents a forum for regulators to discuss and learn from the expertise of developed countries like the United States and Australia, which have been developing their regulatory framework for Collective Investment Schemes over many years."
In May 1998, the APEC Finance Ministers Meeting endorsed the establishment of the APEC Financial Regulators Training Initiative to enhance training efforts for national and regional financial regulators within Asia.
ADB, based in Manila, is dedicated to reducing poverty in the Asia and Pacific region through pro-poor sustainable economic growth, social development, and good governance. Established in 1966, it is owned by 64 members - 46 from the region. In 2005, it approved loans and grants for projects totaling $6.95 billion, and technical assistance amounting to $198.8 million.
Trading Bonuses & Hedge Fund Sales
A major new survey of salary and bonus packages awarded to stock market traders globally reveals Monday that those operating in the Middle East achieved the highest percentage increases ahead of their counterparts in London and on Wall Street.
The sixth annual Napier Scott survey, conducted among 3,000 front office traders and sales people, reveals that Middle East packages increased by 25-30% while those in the UK went up by 17-22%, and only 10-15% in the US.
Shaun Springer, CEO of Napier Scott Executive Search, of London, said: 'The hike in Middle East salaries and bonus reflects the growing appetite for more sophisticated financial products and increasing pressure for talented professionals in this market.
Hedge Funds sales continue to be the principal area of hiring within the marketing functions although less pronounced than in 2005. The survey is the first to be published post the 2007 bonus round.
While those in trading enjoyed the highest percentage increase, and in terms of people moves in asset classes, Equity Derivatives have been the most active. They have also enjoyed the highest percentage increase in salary packages for sales and trading.
"Talk of capping City bonuses can only be counter productive. If those operating in the markets are not allowed to make these profits, from which their remuneration packages are based, they will be moved elsewhere by their banks or indeed, the whole operation."
Springer said that although he was confident that London's supremacy as the global financial center would continue, he doubts bonus levels in the UK would continue to increase at the same rate as in recent years. There is the possibility of this year's bonuses exceeding those of 2008. Since 2002 when many City bonuses were virtually halved following 9/11 and a series of stock market shocks, packages have doubled.
The sixth annual Napier Scott survey, conducted among 3,000 front office traders and sales people, reveals that Middle East packages increased by 25-30% while those in the UK went up by 17-22%, and only 10-15% in the US.
Shaun Springer, CEO of Napier Scott Executive Search, of London, said: 'The hike in Middle East salaries and bonus reflects the growing appetite for more sophisticated financial products and increasing pressure for talented professionals in this market.
Hedge Funds sales continue to be the principal area of hiring within the marketing functions although less pronounced than in 2005. The survey is the first to be published post the 2007 bonus round.
While those in trading enjoyed the highest percentage increase, and in terms of people moves in asset classes, Equity Derivatives have been the most active. They have also enjoyed the highest percentage increase in salary packages for sales and trading.
"Talk of capping City bonuses can only be counter productive. If those operating in the markets are not allowed to make these profits, from which their remuneration packages are based, they will be moved elsewhere by their banks or indeed, the whole operation."
Springer said that although he was confident that London's supremacy as the global financial center would continue, he doubts bonus levels in the UK would continue to increase at the same rate as in recent years. There is the possibility of this year's bonuses exceeding those of 2008. Since 2002 when many City bonuses were virtually halved following 9/11 and a series of stock market shocks, packages have doubled.
23 Mar 2007
BISYS Wins European Hedge Fund Award
At the inaugural Who’s Who of European Hedge Fund Lawyers awards dinner, BISYS Alternative Investment Services, received the Best Single / Multi-Strategy Hedge Fund Administrator award. This ceremony celebrated the leading service providers in the European hedge fund industry.
This prestigious honor was based on BISYS' commitment to clients, business growth, investment in technology, strategic partnerships and strong client feedback. BISYS' strategic partners - Linedata Services' Beauchamp and RiskMetrics Group, also won awards for Best Hedge Fund Technology Supplier and Best Risk Management Software Supplier, respectively.
"We are delighted about winning this award, which is a tribute to the commitment of our dedicated service teams," said Ronan Daly, president of BISYS Hedge Fund Services, who accepted the award on behalf of BISYS. "
BISYS Alternative Investment Services is a global provider of administrative, accounting, advisory, and tax services for the alternative investment industry with over $275 billion in assets under administration. BISYS has approximately 500 clients and over 1,500 funds, including hedge funds, private equity funds, fund-of-funds, and other alternative investment products. BISYS Alternative Investment Services is a division of The BISYS Group, Inc.Study Shows Institutional Investors are Comfortable With Hedge Fund Investing
State Street Corporation released its third institutional investor hedge fund study, the study was conducted late last year in conjunction with the 2006 Global Absolute Return congress.
According to the study, more than half of respondents indicated that their governing bodies are more comfortable investing in hedge funds today than they were 12 months ago. Reinforcing this interest, more than half of boards also spend 15% or more of their time on the subject. Asset owners participating in the study included representatives from global pensions with investable assets totaling more than $1 trillion.
According to the study, more than half of respondents indicated that their governing bodies are more comfortable investing in hedge funds today than they were 12 months ago. Reinforcing this interest, more than half of boards also spend 15% or more of their time on the subject. Asset owners participating in the study included representatives from global pensions with investable assets totaling more than $1 trillion.
"The findings of our study reinforce the industry trend we've been witnessing among our client base − investment boards are overwhelmingly accepting that hedge funds are a viable option for their investment allocations," said Gary Enos, executive vice president and head of State Street's alternative investment servicing business. "They are also discovering the various ways hedge funds can be incorporated into portfolios based upon investors' risk appetite, return targets and overall investment objectives."
Results also show that the percentage of asset owners investing in alternatives increased significantly over last year. This year, only 4% of asset owners indicated they have no hedge fund investments, down from 16% last year.
Nearly half cited a need for additional reporting and analysis on the part of hedge fund managers and more rigorous due diligence practices. In addition, the same number also agreed that obtaining an accurate valuation of hedge fund holdings can be problematic.
"The tools, methods and best practices for managing risk will further develop as hedge funds become a tried and true staple of institutional portfolios," said Enos. "Particularly in light of regulatory pressure and changes in accounting practices, asset owners will continue to push hedge fund managers and third-party service providers, such as administrators, to develop and deliver enhanced risk and transparency solutions."
State Street Corporation provides institutional investors with research and trading services. With $11.9 trillion in assets under custody and $1.7 trillion in assets under management, State Street operates in 26 countries and more than 100 geographic markets worldwide.22 Mar 2007
SEC Returns $38 Million To Hedge Fund Investors
The Securities and Exchange Commission today announced in a press release the distribution of approximately $38 million in Fair Funds to approximately 810 mutual funds that were victims of fraudulent market timing and late trading by the Veras hedge funds.
The funds distributed reflect the entirety of the disgorgement and civil penalties paid by the Veras hedge funds and their principals to settle charges of unlawful market timing and late trading brought by the SEC.
The Sarbanes-Oxley Act of 2002 gave the SEC authority to increase the amount of money returned to harmed investors by allowing civil penalties to be included in Fair Fund distributions. To date, the SEC has distributed over $1 billion in Fair Funds.
Linda Chatman Thomsen, Director of the Division of Enforcement, said, “Today’s distribution marks another significant step in the Commission’s vigorous program to return money to investors injured by mutual fund trading abuses.”
On Dec. 22, 2005, the SEC brought settled administrative proceedings against the Veras Capital Master Fund, VEY Partners Master Fund, Veras Investment Partners, LLC, Kevin D. Larson, and James R. McBride for their participation in a fraudulent market timing and late trading scheme. Respondents consented to entry of the settlement order without admitting or denying the SEC’s findings.
The settlement order found that from January 2002 through September 2003, respondents used deceptive techniques to continue market timing in mutual funds that previously had detected and restricted, or that otherwise would not have permitted, the Veras hedge funds’ trading.
The settlement order provided for distribution of the Fair Fund directly to the mutual funds affected by Veras’ misconduct. The settlement funds are being distributed by the U.S. Treasury directly to the affected mutual funds pursuant to the distribution plan approved by the SEC on Oct. 4, 2006.
The funds distributed reflect the entirety of the disgorgement and civil penalties paid by the Veras hedge funds and their principals to settle charges of unlawful market timing and late trading brought by the SEC.
The Sarbanes-Oxley Act of 2002 gave the SEC authority to increase the amount of money returned to harmed investors by allowing civil penalties to be included in Fair Fund distributions. To date, the SEC has distributed over $1 billion in Fair Funds.
Linda Chatman Thomsen, Director of the Division of Enforcement, said, “Today’s distribution marks another significant step in the Commission’s vigorous program to return money to investors injured by mutual fund trading abuses.”
On Dec. 22, 2005, the SEC brought settled administrative proceedings against the Veras Capital Master Fund, VEY Partners Master Fund, Veras Investment Partners, LLC, Kevin D. Larson, and James R. McBride for their participation in a fraudulent market timing and late trading scheme. Respondents consented to entry of the settlement order without admitting or denying the SEC’s findings.
The settlement order found that from January 2002 through September 2003, respondents used deceptive techniques to continue market timing in mutual funds that previously had detected and restricted, or that otherwise would not have permitted, the Veras hedge funds’ trading.
The settlement order provided for distribution of the Fair Fund directly to the mutual funds affected by Veras’ misconduct. The settlement funds are being distributed by the U.S. Treasury directly to the affected mutual funds pursuant to the distribution plan approved by the SEC on Oct. 4, 2006.
Londinium Emerging Markets Fund Of Hedge Fund Launch
Redi & Partners has announced the launch of its first fund of emerging markets hedge fund, the Londinium JPM Emerging Market Fund by investment manager JPMorgan.
The Londinium JPM Emerging Markets Fund was created after a six months study of the economic prospects of emerging countries. Redi & Partners, as Investment Advisor, has selected 19 funds out of a universe of 200 funds, the selections were made through research, direct contacts and personal interviews.
Launched on the 15th of March, 2007, the fund is based in France, where new regulations issued by the French Authorities are attracting the establishment of new hedge funds at the expense of off-shore tax havens.
The initial allocation to each fund has been limited to 5% to create a broad base. Great attention has been placed in studying the strategies and styles of trading of each fund to avoid concentration of the same and reduce the volatility of the new fund of hedge funds. Some of the markets include, Greater China, Eastern Europe, including Russia, Kazakhstan, the Baltic republics, Romania and Bulgaria, India, Brazil, Japan, as well the Pacific market.
BNP Paribas is administrator, with their securities services branch as custodian. JPMorgan is responsible for negotiating the investments in the funds. Preference has been given to hedge funds and long only funds wherever a real hedging was possible.
Funds of hedge funds have seen a 29% increase in 2006, and the trend is expected to continue in 2007. The Londinium JPM Emerging Market Fund will work with the emerging markets equity, cash futures arbitrage, volatility arbitrage, statistical arbitrage, merger arbitrage and convertible bond arbitrage. As well as managed accounts specialized in currency instruments, debt and debt related financial securities linked to global emerging countries.
The unique fund aims at offering the highest level of negotiating power, security, transparency and independence of controls. The pro-forma performance of the basket shows an annualised rate of return of 26.97%, with an annualized volatility of 8.73%. Outperforming by almost twice as much the CSFB/Tremont Emerging Markets Index (+15.36%).
The investments in Managed Accounts 15%, with weekly liquidity, plus the cash 5% totaling 20% allow the Londinium JPM Emerging Markets Fund to flexibly modify its profile, especially in case of unexpected market events, in one week.
For more information, contact; info@redi.co.uk
The Londinium JPM Emerging Markets Fund was created after a six months study of the economic prospects of emerging countries. Redi & Partners, as Investment Advisor, has selected 19 funds out of a universe of 200 funds, the selections were made through research, direct contacts and personal interviews.
Launched on the 15th of March, 2007, the fund is based in France, where new regulations issued by the French Authorities are attracting the establishment of new hedge funds at the expense of off-shore tax havens.
The initial allocation to each fund has been limited to 5% to create a broad base. Great attention has been placed in studying the strategies and styles of trading of each fund to avoid concentration of the same and reduce the volatility of the new fund of hedge funds. Some of the markets include, Greater China, Eastern Europe, including Russia, Kazakhstan, the Baltic republics, Romania and Bulgaria, India, Brazil, Japan, as well the Pacific market.
BNP Paribas is administrator, with their securities services branch as custodian. JPMorgan is responsible for negotiating the investments in the funds. Preference has been given to hedge funds and long only funds wherever a real hedging was possible.
Funds of hedge funds have seen a 29% increase in 2006, and the trend is expected to continue in 2007. The Londinium JPM Emerging Market Fund will work with the emerging markets equity, cash futures arbitrage, volatility arbitrage, statistical arbitrage, merger arbitrage and convertible bond arbitrage. As well as managed accounts specialized in currency instruments, debt and debt related financial securities linked to global emerging countries.
The unique fund aims at offering the highest level of negotiating power, security, transparency and independence of controls. The pro-forma performance of the basket shows an annualised rate of return of 26.97%, with an annualized volatility of 8.73%. Outperforming by almost twice as much the CSFB/Tremont Emerging Markets Index (+15.36%).
The investments in Managed Accounts 15%, with weekly liquidity, plus the cash 5% totaling 20% allow the Londinium JPM Emerging Markets Fund to flexibly modify its profile, especially in case of unexpected market events, in one week.
For more information, contact; info@redi.co.uk
21 Mar 2007
Give him a place to stand, and he will move the world.
Hedge funds may give investors the ability to operate free from the shackles of the usual emotions and psychology of the marketplace
read more | digg story
read more | digg story
Investcorp Launches Early Stage Fund & Wins Hedge Fund Award
Bahrain-based $5 billion hedge fund Investcorp has won the Institutional Hedge Fund Manager award at the inaugural Hedge Funds World Awards in Dubai. The awards are designed to recognise and encourage excellence in the Middle East hedge fund industry.
The award comes at a time when Investcorp is marketing to GCC investors its new Investcorp Early Stage Fund, which invests in newly formed hedge funds, the firm said in a statement. The initial portfolio will be composed of approximately 15-20 managers with targeted returns of 12-14% with annualized volatility of 5-7% over the medium term. The fund offers quarterly liquidity with a one-year lock up period.
Investcorp's co-heads Deepak Gurnani and Ibrahim Gharghour expressed their delight at receiving this industry recognition. "It is an outstanding tribute to be recognised by our industry peers at this leading event," said Mr Gurnani.
"We see this as a testament to the achievements of the past 10 years in pioneering acceptance of hedge funds as an asset class for institutions in the region, and in building a strong business based on superior performance grounded in an industry-leading risk management process."
Mr Gharghour said that the award reflected the fund's substantial progress in widening its business, through current initiatives such as its strategic partnership with London-based WMG. Investcorp and five other hedge funds were selected from over 20 finalists representing leading global hedge fund firms.
Since 1996, Investcorp has invested with more than 50 hedge funds within the first 12 months of their launch and now manage approximately $1 billion in early stage investments.
The award comes at a time when Investcorp is marketing to GCC investors its new Investcorp Early Stage Fund, which invests in newly formed hedge funds, the firm said in a statement. The initial portfolio will be composed of approximately 15-20 managers with targeted returns of 12-14% with annualized volatility of 5-7% over the medium term. The fund offers quarterly liquidity with a one-year lock up period.
Investcorp's co-heads Deepak Gurnani and Ibrahim Gharghour expressed their delight at receiving this industry recognition. "It is an outstanding tribute to be recognised by our industry peers at this leading event," said Mr Gurnani.
"We see this as a testament to the achievements of the past 10 years in pioneering acceptance of hedge funds as an asset class for institutions in the region, and in building a strong business based on superior performance grounded in an industry-leading risk management process."
Mr Gharghour said that the award reflected the fund's substantial progress in widening its business, through current initiatives such as its strategic partnership with London-based WMG. Investcorp and five other hedge funds were selected from over 20 finalists representing leading global hedge fund firms.
Since 1996, Investcorp has invested with more than 50 hedge funds within the first 12 months of their launch and now manage approximately $1 billion in early stage investments.
20 Mar 2007
Mother & Son Team Charged With Hedge Fund Scheme
U.S. Attorney Kevin J. O’Connor announced that a federal grand jury in New Haven NY returned a four-count Indictment charging Ayferafat Yalincak, also known as "Jackie Yalincak," and "Irene Kelly," age 50, and her son, Hakan Yalincak, also known as "Hagen Yalincak," age 21, both Turkish citizens, with operating a multi-million dollar investment hedge fund fraud scheme.
The conspiracy charge carries a maximum term of imprisonment of five years and a fine of up to $250,000. Each wire fraud charge carries a maximum term of imprisonment of 20 years and a fine of up to $250,000.
According to documents filed with the Court and statements made in court, Ayferafat Yalincak and Hakan Yalincak solicited approximately $7 million from several investors for their fake hedge fund. Ayferafet Yalincak, 52, pleaded guilty last year to conspiracy to commit wire fraud, but tried to downplay her role in the hedge fund scheme she attributed to her 22-year-old son, Hakan.
Prosecutors say Hakan Yalincak charmed his way into the exclusive world of Greenwich high finance by posing as an heir to a wealthy Turkish family. He moved counterfeit checks and brokered deals with a Kuwaiti financier. Ayferafet Yalincak told a federal judge last year that she attended meetings with investors and allowed her son to present her as a member of an exceedingly wealthy Turkish family who was going to invest millions in his hedge fund.
Prosecutors say Ayferafet Yalincak was responsible for an intended loss of $5.3 million and an actual loss of $3.9 million after some of the money was returned to investors.
"This mother and son team are alleged to have defrauded several sophisticated investors out of a substantial sum of money," U.S. Attorney O’Connor stated. "This Office places a high priority on investigating and vigorously prosecuting investor fraud schemes. This investigation is ongoing." The case has been investigated by the U.S. Postal Inspection Service and the Federal Bureau of Investigation.
The conspiracy charge carries a maximum term of imprisonment of five years and a fine of up to $250,000. Each wire fraud charge carries a maximum term of imprisonment of 20 years and a fine of up to $250,000.
According to documents filed with the Court and statements made in court, Ayferafat Yalincak and Hakan Yalincak solicited approximately $7 million from several investors for their fake hedge fund. Ayferafet Yalincak, 52, pleaded guilty last year to conspiracy to commit wire fraud, but tried to downplay her role in the hedge fund scheme she attributed to her 22-year-old son, Hakan.
Prosecutors say Hakan Yalincak charmed his way into the exclusive world of Greenwich high finance by posing as an heir to a wealthy Turkish family. He moved counterfeit checks and brokered deals with a Kuwaiti financier. Ayferafet Yalincak told a federal judge last year that she attended meetings with investors and allowed her son to present her as a member of an exceedingly wealthy Turkish family who was going to invest millions in his hedge fund.
Prosecutors say Ayferafet Yalincak was responsible for an intended loss of $5.3 million and an actual loss of $3.9 million after some of the money was returned to investors.
"This mother and son team are alleged to have defrauded several sophisticated investors out of a substantial sum of money," U.S. Attorney O’Connor stated. "This Office places a high priority on investigating and vigorously prosecuting investor fraud schemes. This investigation is ongoing." The case has been investigated by the U.S. Postal Inspection Service and the Federal Bureau of Investigation.
Investec-Blackfish Hedge Fund Launch
Investec Bank and Blackfish Capital Management launched a long/short natural resources hedge fund on March 1 with a plan to raise $300 million over the next six to 12 months from undervalued stocks in the mining and resources sector.
With a $40 million Equity at Launch, the Blackfish-Investec Resources Special Situations Fund's prime broker is Goldman Sachs, with Walkers as Law firm and Butterfield Bank as administrator, Kinetic Partners will Audit the new hedge fund.
The Blackfish-Investec Resources Special Situations Fund is domiciled in the Cayman Islands. Targeted primarily at institutional investors, the the hedge fund strategy will be to achieve absolute returns through strategic investments in the small to mid-cap resources sector focused on value opportunities on the long and short side. The manager will trade the underlying commodities to provide a hedge to the market, actively managing commodity price risk.
Investec and Blackfish have each invested $20 million into the fund as seed capital. The hedge fund investment team is led by Martyn Konig, chief executive of Blackfish Capital Management and George Rogers, head of commodities and resource finance at Investec Bank.
Established in 1974, Investec is a specialist international banking group that provides a diverse range of financial products and services to a niche client base in the UK and Australia as well as South Africa, its country of origin, and various other countries. Investec Bank (UK) is a unit of South African banking group Investec Plc.
With a $40 million Equity at Launch, the Blackfish-Investec Resources Special Situations Fund's prime broker is Goldman Sachs, with Walkers as Law firm and Butterfield Bank as administrator, Kinetic Partners will Audit the new hedge fund.
The Blackfish-Investec Resources Special Situations Fund is domiciled in the Cayman Islands. Targeted primarily at institutional investors, the the hedge fund strategy will be to achieve absolute returns through strategic investments in the small to mid-cap resources sector focused on value opportunities on the long and short side. The manager will trade the underlying commodities to provide a hedge to the market, actively managing commodity price risk.
Investec and Blackfish have each invested $20 million into the fund as seed capital. The hedge fund investment team is led by Martyn Konig, chief executive of Blackfish Capital Management and George Rogers, head of commodities and resource finance at Investec Bank.
Established in 1974, Investec is a specialist international banking group that provides a diverse range of financial products and services to a niche client base in the UK and Australia as well as South Africa, its country of origin, and various other countries. Investec Bank (UK) is a unit of South African banking group Investec Plc.
19 Mar 2007
Give him a place to stand, and he will move the world
Actually, the title is the name of the picture, it has nothing to do with the story, I just like it. The article is called "Investing: Hedge funds: market angels or demons?"
The article is from Bloomberg, asking whether hedge funds really the disruptive, destabilizing force their critics make them out to be, or do they help make the financial markets run smoother?
It says, "The beauty of hedge funds is their ability, at least in theory, to operate free from the shackles of the usual emotions and psychology of the marketplace."
A measure of cold calculation may be just what is wanted when most investors get caught up in the emotions of a turbulent market. While the herd is stampeding in one direction, nobody is better equipped than hedge funds to get a little movement going the other way.
Interesting poem.
Chapman Hedge Fund Files Against eSpeed Inc.
Activist hedge fund Chapman Capital, filed a 13-D filing with the Securities and Exchange Commission in a bid to put electronic trading network eSpeed Inc. on the market.
Robert Chapman said his hedge fund, which is eSpeed's biggest shareholder with 9.3%, has begun contacting eSpeed’s competitors to gauge interest in the firm, which has suffered a disappointing recent trading performance.
In its SEC filing, the hedge fund wrote; "Chapman Capital announced its demand that eSpeed maximise shareholder value via a change of control transaction." It also asked the SEC to compel the eSpeed board of directors to convert the company's B shares into A shares. Holders of B shares have 10 votes per share, A shares just one vote.
The hedge fund also said it communicated to Howard Lutnick, the chairman, chief executive and president of eSpeed, its "strong assertion" that, given his "demonstrated failure to perform in his capacity as CEO", eSpeed's long-term shareholder value "should be maximised via a full-scale auction" and that "the company’s ownership base has conveyed a nearly uniform desire for eSpeed’s Class A shares to be maximized through a change-of-control transaction."
Chapman Capital is a $300 million dollar L.A. based hedge fund run by Robert Chapman. Chapman is founder of the "13-D filing" that most activist hedge funds use today. Over the past 10 years, Chapman Capital has agitated successfully for the restructuring or sale of over 20 publicly-traded companies.
Robert Chapman said his hedge fund, which is eSpeed's biggest shareholder with 9.3%, has begun contacting eSpeed’s competitors to gauge interest in the firm, which has suffered a disappointing recent trading performance.
In its SEC filing, the hedge fund wrote; "Chapman Capital announced its demand that eSpeed maximise shareholder value via a change of control transaction." It also asked the SEC to compel the eSpeed board of directors to convert the company's B shares into A shares. Holders of B shares have 10 votes per share, A shares just one vote.
The hedge fund also said it communicated to Howard Lutnick, the chairman, chief executive and president of eSpeed, its "strong assertion" that, given his "demonstrated failure to perform in his capacity as CEO", eSpeed's long-term shareholder value "should be maximised via a full-scale auction" and that "the company’s ownership base has conveyed a nearly uniform desire for eSpeed’s Class A shares to be maximized through a change-of-control transaction."
Chapman Capital is a $300 million dollar L.A. based hedge fund run by Robert Chapman. Chapman is founder of the "13-D filing" that most activist hedge funds use today. Over the past 10 years, Chapman Capital has agitated successfully for the restructuring or sale of over 20 publicly-traded companies.
16 Mar 2007
IceCapital Launches Alternative Fund
IceCapital Fund Management Company Ltd. announced in a press release on Wednesday that it has launched a new non-UCITS mutual fund, IceCapital Alternative Beta, which offers hedge fund like return, in liquid and risk-transparent form. The fund is the first of its kind in Finland and one of the earliest in Europe.
UCITS - Undertakings for Collective Investment in Transferable Securities - is the name given by the European Union (EU) to pan-European investment funds.
The fund is based on latest research on so-called alternative risk premiums. The strategy is to invest in alternative market risk factors, or alternative betas, with which it is possible to form a portfolio that closely tracks the average performance of hedge funds. At the same time the investor receives extra return, or risk premium, as compensation for risk while benefiting from better diversification than in the traditional equity and bond investments.
"The very fast growth of IceCapital's asset management business is due to quick innovativeness. IceCapital Alternative Beta fund is yet another example of that. At the same time, the fund's broad core-satellite range of investments is supplemented with an attractive active investment", says Managing Director, Jyri Viskari.
Mutual Fund IceCapital Alternative Beta starts on 14 March 2007. The minimum investment amount is 100.000 Euros and the fund is open weekly. The portfolio manager of the fund is ICECAPITAL Asset Management Ltd’s Chief Investment Officer Mikael Simonsen.
IceCapital Asset Management and IceCapital Fund Management are part of the independent IceCapital Group, which focuses on investment banking, asset management and private equity. The group currently manages assets reaching 2 billion Euros.
UCITS - Undertakings for Collective Investment in Transferable Securities - is the name given by the European Union (EU) to pan-European investment funds.
The fund is based on latest research on so-called alternative risk premiums. The strategy is to invest in alternative market risk factors, or alternative betas, with which it is possible to form a portfolio that closely tracks the average performance of hedge funds. At the same time the investor receives extra return, or risk premium, as compensation for risk while benefiting from better diversification than in the traditional equity and bond investments.
"The very fast growth of IceCapital's asset management business is due to quick innovativeness. IceCapital Alternative Beta fund is yet another example of that. At the same time, the fund's broad core-satellite range of investments is supplemented with an attractive active investment", says Managing Director, Jyri Viskari.
Mutual Fund IceCapital Alternative Beta starts on 14 March 2007. The minimum investment amount is 100.000 Euros and the fund is open weekly. The portfolio manager of the fund is ICECAPITAL Asset Management Ltd’s Chief Investment Officer Mikael Simonsen.
IceCapital Asset Management and IceCapital Fund Management are part of the independent IceCapital Group, which focuses on investment banking, asset management and private equity. The group currently manages assets reaching 2 billion Euros.
F&C to Launch More Hedge Funds "As the Need Arises"
F&C Asset Management PLC is planning on launching its first private equity fund of funds product for institutional investors. The new fund will invest in event-driven hedge funds, which bet on M&A, share buy-backs and other corporate events.
The new fund will invest in between 20 and 40 hedge funds selected and monitored by F&C Partners. Alain Grisay, F&C's CEO, said at a press conference: "We are near the completion of our first new European private equity limited partnership." The first soft closing for the fund is expected in a couple of weeks and initial institutional commitment could be in the region of E130 million ($173 million).
F&C is also pursuing alternative investments such as hedge funds with a global diversified fixed income products. "Further hedge funds will be launched as and when we identify the right opportunity", he said. This is part of a three-year plan to focus on specialised and high-fee fund management activities such as hedge funds and LDI's (Liability Driven Investments).
Earlier this month a new portable alpha fund was launched using long/short bets on assets, markets and currencies through the use of derivatives.
"We are convinced that this product has the potential to achieve significant scale," Grisay said. The results for the new strategic plan will be visible by 2009, the CEO pledged.
The new fund will invest in between 20 and 40 hedge funds selected and monitored by F&C Partners. Alain Grisay, F&C's CEO, said at a press conference: "We are near the completion of our first new European private equity limited partnership." The first soft closing for the fund is expected in a couple of weeks and initial institutional commitment could be in the region of E130 million ($173 million).
F&C is also pursuing alternative investments such as hedge funds with a global diversified fixed income products. "Further hedge funds will be launched as and when we identify the right opportunity", he said. This is part of a three-year plan to focus on specialised and high-fee fund management activities such as hedge funds and LDI's (Liability Driven Investments).
Earlier this month a new portable alpha fund was launched using long/short bets on assets, markets and currencies through the use of derivatives.
"We are convinced that this product has the potential to achieve significant scale," Grisay said. The results for the new strategic plan will be visible by 2009, the CEO pledged.
15 Mar 2007
Lehman Brothers buys 20% of Hedge Fund
Lehman Brothers Holdings Inc. announced on Tuesday that it had bought a 20% stake in hedge fund D.E. Shaw Group, which was formed in 1988 and has about $29 billion in aggregate investment capital. The hedge fund has more than 1,000 employees across the United States and internationally.
D.E. Shaw uses computer programs to find discrepancies in prices among securities. It also invests in distressed debt and makes bets on broad economic trends using stocks, bonds, currencies and commodities.
Lehman Brothers, traditionally seen as a bond house, has invested heavily in alternative investments in recent years, they have minority ownership in four other hedge funds, Spinnaker Capital Group, GLG Partners LP, Ospraie Management LP and Marble Bar Asset Management.
Lehman manages $225 billion, including $9 billion in alternative-investment assets such as hedge funds. That doesn't include money at the firms in which it has minority stakes. Last year, the firm generated $1.4 billion in revenue from asset management, or 8% of total revenue.
The price of the stake wasn't disclosed, though the New York-based firms said in a statement today it would be tied to hedge fund D.E. Shaw's performance.
D.E. Shaw uses computer programs to find discrepancies in prices among securities. It also invests in distressed debt and makes bets on broad economic trends using stocks, bonds, currencies and commodities.
Lehman Brothers, traditionally seen as a bond house, has invested heavily in alternative investments in recent years, they have minority ownership in four other hedge funds, Spinnaker Capital Group, GLG Partners LP, Ospraie Management LP and Marble Bar Asset Management.
Lehman manages $225 billion, including $9 billion in alternative-investment assets such as hedge funds. That doesn't include money at the firms in which it has minority stakes. Last year, the firm generated $1.4 billion in revenue from asset management, or 8% of total revenue.
The price of the stake wasn't disclosed, though the New York-based firms said in a statement today it would be tied to hedge fund D.E. Shaw's performance.
Hedge Fund Index up for Febuary
According to hedge fund index provider Greenwich Alternative Investments LLC., their Global Hedge Fund Index returned +0.61% in February.
The Greenwich Investable Hedge Fund Index closely tracked the Global Index, returning +0.45% in February and +1.79% year to date, within two basis points of the Global Index return of +1.81% for the year.
“Hedge funds’ downside protection, coupled with their ability to capture market upside, continues to translate into superior risk-adjusted returns." says Ben Rossman, general manager of Greenwich, "Long-biased managers were able to mitigate the effects of February’s declining equities to end the month in positive territory," he said in a press release.
By comparison, both Greenwich Hedge Fund Indices are ahead of the major equity and bond indices for 2007: S&P 500, MSCI World Equity Index, and the FTSE 100 posted returns of -1.96% (-0.48% YTD), -0.65% (+0.46% YTD), and -0.51% (-0.79% YTD), while the Lehman Aggregate Bond Index posted +1.54% (+1.50% YTD). Performance was positive across 12 of the 13 hedge fund strategies followed by the Global Index, with 96% of reporting funds outperforming the S&P 500.
During the last five years the Greenwich Global Hedge Fund Index has produced annualized returns of +9.54% with a maximum drawdown of -4.55%, outperforming the S&P 500, MSCI World Equity Index, and FTSE 100 which have had respective annualized returns of +6.81%, +9.13%, and +3.88%, with more severe drawdowns of -20.15%, -17.24%, and -29.40%.”
Greenwich Alternative Investments, LLC (and its affiliates) manages one of the world's largest hedge fund databases and is among the oldest providers of hedge fund indices, asset management services and research to institutional investors worldwide.
The Greenwich Investable Hedge Fund Index closely tracked the Global Index, returning +0.45% in February and +1.79% year to date, within two basis points of the Global Index return of +1.81% for the year.
“Hedge funds’ downside protection, coupled with their ability to capture market upside, continues to translate into superior risk-adjusted returns." says Ben Rossman, general manager of Greenwich, "Long-biased managers were able to mitigate the effects of February’s declining equities to end the month in positive territory," he said in a press release.
By comparison, both Greenwich Hedge Fund Indices are ahead of the major equity and bond indices for 2007: S&P 500, MSCI World Equity Index, and the FTSE 100 posted returns of -1.96% (-0.48% YTD), -0.65% (+0.46% YTD), and -0.51% (-0.79% YTD), while the Lehman Aggregate Bond Index posted +1.54% (+1.50% YTD). Performance was positive across 12 of the 13 hedge fund strategies followed by the Global Index, with 96% of reporting funds outperforming the S&P 500.
During the last five years the Greenwich Global Hedge Fund Index has produced annualized returns of +9.54% with a maximum drawdown of -4.55%, outperforming the S&P 500, MSCI World Equity Index, and FTSE 100 which have had respective annualized returns of +6.81%, +9.13%, and +3.88%, with more severe drawdowns of -20.15%, -17.24%, and -29.40%.”
Greenwich Alternative Investments, LLC (and its affiliates) manages one of the world's largest hedge fund databases and is among the oldest providers of hedge fund indices, asset management services and research to institutional investors worldwide.
13 Mar 2007
Union leaders to Develop International Response to Growth of Hedge Funds
Amid the spectacular growth of hedge funds investments, trade union leaders from more than 20 countries are to meet at OECD Headquarters in Paris on the 16 March to discuss the impact of hedge funds on employees’ job security and pensions.
In recent weeks the unions have had concerns about the employment impact of buy-outs and questions about hedge fund transparency, corporate governance and sustainability.
Concerns have also been raised at the increasing amounts of pension fund money being invested in private equity and in hedge funds and the working women and men whose employment, rights and working conditions may be threatened by the behavior of these funds.
"We are looking at the feasibility of an international response that includes information and consultation rights for workers and appropriate regulation and taxation by governments." said John Evans, General Secretary of the Trade Union Advisory Committee to the OECD, co-organizers of the event.
TUAC said in a press release, "Union concern has mounted at the employment impact of buyouts by what are often shadowy investors using borrowed money. Concerns have also been raised at the increasing amounts of pension fund money being invested in private equity and in hedge funds."
Speakers will include experts from the OECD as well as John Monks, General Secretary of the European Trade Union Confederation and Ron Blackwell, Chief Economist of the American Trade Union Center, the AFL-CIO. The TUAC represents 66 million workers in 56 affiliated trade union organizations in the 30 OECD member countries.
In recent weeks the unions have had concerns about the employment impact of buy-outs and questions about hedge fund transparency, corporate governance and sustainability.
Concerns have also been raised at the increasing amounts of pension fund money being invested in private equity and in hedge funds and the working women and men whose employment, rights and working conditions may be threatened by the behavior of these funds.
"We are looking at the feasibility of an international response that includes information and consultation rights for workers and appropriate regulation and taxation by governments." said John Evans, General Secretary of the Trade Union Advisory Committee to the OECD, co-organizers of the event.
TUAC said in a press release, "Union concern has mounted at the employment impact of buyouts by what are often shadowy investors using borrowed money. Concerns have also been raised at the increasing amounts of pension fund money being invested in private equity and in hedge funds."
Speakers will include experts from the OECD as well as John Monks, General Secretary of the European Trade Union Confederation and Ron Blackwell, Chief Economist of the American Trade Union Center, the AFL-CIO. The TUAC represents 66 million workers in 56 affiliated trade union organizations in the 30 OECD member countries.
Activist Hedge Fund To Sell Stocks in Gartmore
Activist hedge fund Carrousel Capital had agreed to sell its shares in £386 million ($744.8 million) Gartmore European Investment Trust, refusing the option of a tender offer to close out its position at a tight discount. The hedge fund currently owns 28.03% of Gartmore and is its biggest shareholder.
Carrousel Capital said in informal talks with Gartmore that the hedge fund had plans to buy into the trust, then restructure it into an umbrella fund which could offer a range of investment mandates. However, Gartmore's European shareholders voted against proposals by Carrousel to put three new directors on the board to carry out the plan.
Bruno Sanglé-Ferrière, CEO of Carrousel said in a letter to shareholders, "Carrousel is not seeking, and has never sought, control of the fund. Neither is it seeking to wind-up the fund as has been suggested in some quarters. Carrousel's interest in the fund has already had a beneficial effect. Shareholders have seen the NAV discount narrow from 9% to less than 3% since we invested."
However, after the vote to sell the hedge fund's entire holding he said, "It's not a change of strategy. We tried to put people on the board and we failed. We want to put that behind us and close that chapter."
Carrousel Capital said in informal talks with Gartmore that the hedge fund had plans to buy into the trust, then restructure it into an umbrella fund which could offer a range of investment mandates. However, Gartmore's European shareholders voted against proposals by Carrousel to put three new directors on the board to carry out the plan.
Bruno Sanglé-Ferrière, CEO of Carrousel said in a letter to shareholders, "Carrousel is not seeking, and has never sought, control of the fund. Neither is it seeking to wind-up the fund as has been suggested in some quarters. Carrousel's interest in the fund has already had a beneficial effect. Shareholders have seen the NAV discount narrow from 9% to less than 3% since we invested."
However, after the vote to sell the hedge fund's entire holding he said, "It's not a change of strategy. We tried to put people on the board and we failed. We want to put that behind us and close that chapter."
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