05/01/2012 Author: Will Wainewright

HFMWeek Daily Snapshot - 5 January

NEWSPAPERS AND WIRES
Global hedge funds pulled in new money in November, ending months of heavy outflows when investors punished managers for a string of poor returns, new data released on Tuesday showed, writes Reuters. Investors put $3.6bn into hedge funds two months ago after having pulled out $9bn in October and having removed $2.6bn in September, research firms BarclayHedge and TrimTabs reported on Tuesday.

Edward Lampert's hedge fund slashed its stake in AutoZone in the final days of last year to meet client redemptions amid a series of setbacks at Sears Holdings, one of its largest and highest profile investments, Bloomberg reports. ESL Investments, the firm run by Lampert, distributed about $1.02bn worth of AutoZone stock to investors in connection with the closing of one investment partnership and the restructuring of another, according to a regulatory filing.

China’s latest attempt to allow fund managers to short stocks while other countries are grappling with their more negative aspects underscores Beijing’s desire to further develop its capital markets and foster its domestic asset management industry, according to the FT. The under-developed nature of China’s capital markets effectively forces its companies to depend on banks at a time when lenders are facing constraints on lending and provides individuals with few options in the hunt for higher returns.

Lawyers for a former Goldman Sachs director accused of insider trading have asked a federal judge to bar prosecutors from playing at his trial secretly recorded phone conversations of a hedge-fund manager he allegedly tipped, writes the Wall Street Journal. The motions to suppress wiretaps of former hedge fund titan Raj Rajaratnam were filed late on Tuesday by lawyers for Rajat Gupta, a former board member at Goldman and Procter & Gamble. Gupta also asked in a separate motion on Tuesday that the charges against him be dismissed.

LAUNCHES
Former FrontPoint portfolio manager John Foo is preparing to launch an Asia-focused hedge fund that will start trading with about $50 million on 1 March in Singapore, reports Reuters. The Asia ex-Japan long/short Kingsmead Asian Alpha Opportunities Fund will be value-driven and offer fee discounts to initial investors as it seeks to grow assets in a tough capital-raising environment for hedge funds in the region.

French group Groupama Asset Management has been forced to radically adjust the long/short strategy of Groupama Alpha Euro Stock due to unsatisfactory performance in recent months, writes Investment Europe. The company said the fund's recent performance and volatile liquidity levels did not correspond to its development objectives, which triggered the decision to reposition the fund's investment strategy.