12/12/2011 Author: Will Wainewright

HFMWeek Daily Snapshot - 12 December

NEWSPAPERS AND WIRES
Hedge funds look set to end 2011 with higher cumulative net subscriptions than at any time since the collapse of US investment bank Lehman Brothers, as investors opt for alternative strategies to ride out stormy markets, according to Reuters. The GlobeOp Capital Movement Index, which tracks monthly net subscriptions to and redemptions from hedge funds managing around $170bn of assets, advanced 1.55 points to 141.01 this month, topping the 140-point mark for the first time since October 2008, when Lehman's demise sent markets across the world into a tailspin.

Nippon Life Insurance Co., Japan’s biggest life insurer with about 50trn yen ($640 billion) of assets, plans to invest more in private-equity funds and maintain its hedge fund allocations, writes Bloomberg. Less than 1% of the insurer’s assets are invested in private-equity and hedge funds, said Hiroo Sakuma, deputy general manager of the company’s credit and alternative investment department in Tokyo.

US hedge fund Elliott Advisers is suing Vietnamese state-run shipbuilder Vinashin in the UK High Court, according to a filing seen by the Wall Street Journal. Vinashin defaulted on a $600m syndicated loan last December, when the first repayment of $60m was due. Other investors in the loan, which was arranged by Credit Suisse in 2007, include Dublin-based Depfa Bank and Malayan Banking Bhd, as well as Credit Suisse.

A day after being told that US regulators may sue him, billionaire hedge fund manager Philip Falcone telephoned Sheldon Lowe, a close friend of 23 years, and told him that he would fight back, reports Bloomberg. Falcone, who rose to fame with bets against US subprime mortgages in 2007, sounded calm and determined, Lowe, a Miami-based real estate developer, said in an interview.

Foreign-exchange strategists are slashing their forecasts for the euro at the fastest pace this year as European Central Bank president Mario Draghi’s interest-rate cuts remove one of the currency’s pillars of support, reports Bloomberg. Since 3 November, when Draghi began to undo the rate increases implemented earlier this year by his predecessor, Jean-Claude Trichet, analysts have reduced end-of-2012 estimates for the euro to $1.32 from $1.40, based on the median of 40 forecasts in a Bloomberg survey as of last week.

LAUNCHES
Goldman Sachs Group plans to provide funding for a hedge fund being started by Todd Edgar, a former commodities trader at Barclays Plc, two people with knowledge of the preparations told Bloomberg. Goldman Sachs will make an investment through a so-called seeding fund that the New York-based firm started this year after raising money for it from pension funds and wealthy individuals, the person said. Edgar will get $150m to $200m from Goldman Sachs in return for a cut of the fees his hedge fund generates.