25/11/2011

HFMWeek Daily Snapshot - 25 November 

NEWSPAPERS AND WIRES
The world’s biggest investment banks have greater staff turnover in commodities than in fixed-income and currencies because of tightening regulations on trading, according to Coalition, a London-based research company, reports Bloomberg. That reflects “general market confidence and demand from non-banking competitors including trading firms, which do not have the same levels of regulatory constraints,” Coalition said in an e-mail, without giving figures. Coalition, founded in 2002, uses company announcements, its own research, media articles and information from people in the market.

Asia and the Middle East are set to emerge as major centres for alternative investment funds in the next few years, according to a report commissioned by the Association for the Luxembourg Fund Industry, writes Citywire. The report - carried out by consultancy Oliver Wyman - breaks down current domicile locations and charts the potential future locations of hedge funds, real estate funds and private equity funds. The study, which was presented in full at the ALFI Conference in Luxembourg, indicates a growing demand among both investors and managers for increased levels of domiciliation in Asia and the Middle East.

Hedge fund investor Bill Ackman apparently isn't buying the idea that Canadian Pacific Railway Ltd. is doomed to underperform rival Canadian National Railway Co. because of a rail system burdened by steeper tracks through the mountains of western Canada, according to the Canadian paper The Globe and Mail. In his third-quarter letter to his investors, Mr. Ackman doesn't say much about his recent investment in Canadian Pacific CP-T , but what he does say signals that he believes that the issue is more with how the company is run than bigger factors that are out of its control, such as the track network.

Market intelligence provider Tricumen released their report on the state of the investment banking industry on Wednesday, the FT reports. One of the most interesting passages of research dealt with the current development of bank prime brokerage units: “Our sources generally agree that hedge funds may continue deleveraging in the next few quarters; still, prime service providers did relatively well in 3Q11, and most of ‘our’ banks are investing in this business. We expect that full-service ‘solutions’ providers will outpace their smaller peers in the medium term. There is growing evidence that hedge funds are abandoning the ‘multiple prime broker’ model (which caused operational difficult even in large funds) in favour of one or two – preferably highly-rated – universal providers.”

The trustee liquidating Bernard L. Madoff’s firm can have a jury determine whether he’ll recover allegedly improper transfers of funds from the confidence man to the owners of the New York Mets, reports Bloomberg. US District Judge Jed Rakoff said in a Nov. 23 ruling that the trustee, New York lawyer Irving Picard, has a right to let a jury instead of Rakoff himself decide the issue when the case goes to trial in Manhattan on March 19.

LAUNCHES
Former DKR Oasis portfolio manager Barun Agarwal is setting up Factorial Management Ltd in Hong Kong and planning to launch a pan-Asia multi-asset hedge fund in early January, reports Reuters. Agarwal, who left Oasis Management (Hong Kong) LLC in August, told the news agency that he was in talks with potential investors to raise capital while waiting for a licence from the market regulator to launch his Factorial Master Fund.