Editor's view: 29 July 2010
Like Paris in the spring, the lure of the Ucits space is proving a heady experience for many managers. First Europe fell for the charms of these onshore products, now the Americans are joining in a communal swoon.
12/02/2010
HFMWeek Daily Snapshot - 12 February
NEWSPAPERS & WIRES
Och-Ziff Capital, the listed US hedge fund manager, has received more than $650m in new client money over the past six weeks, according to regulatory filings –
surpassing the net amount it pulled in over the last six months of 2009 combined, the FT reports. The inflows are one of the first concrete signs of a turnaround in investor sentiment for
the group and the hedge fund industry at large. Och-Ziff, which oversees just over $24bn in assets, is often cited as an industry bellwether because of its size and relatively conservative
approach.
Bluecrest and Winton, two of Europe's biggest hedge fund firms, have signed up to industry body the Hedge Fund Standards Board (HFSB), giving a
boost to the sector's efforts to fend off tough regulation and meet investor demands, says Reuters. The two firms, which both run large computer-driven or 'black box' funds that latch onto
trends in global futures markets, will sign up to the HFSB's code on issues such as valuation and risk management, which supporters hope will eventually become a global industry standard.
Credit Suisse returned to pre-crisis levels of profitability last year, reporting net profits of SFr6.72bn ($6.31bn) yesterday, compared with a loss of SFr8.22bn in
2008, reports the FT. The group also attracted money in its core wealth management division, with total net new money of SFr35.3bn in 2009 – although group earnings and net new money
were hit by one-off charges. Net earnings of SFr793m fell sharply on a quarterly basis, on lower revenues in investment banking.
Galleon Group hedge fund founder Raj Rajaratnam, facing criminal and civil charges in a multimillion dollar insider-trading probe, won an emergency order relieving
him from having to immediately turn over wiretap recordings in the civil case, Reuters reports. The temporary stay granted late on Thursday by US Court of Appeals for the Second Circuit
came two days after US District Court Judge Jed Rakoff ordered Rajaratnam and co-defendant Danielle Chiesi to surrender the recordings to the US SEC by 15
February.
LAUNCHES
Newly-founded commodities hedge fund shop Nautical Capital Management has launched a series of absolute-return strategies, with plans to list a pair of exchange-traded hedge funds
in the second quarter, reports FIN Alternatives. The Purchase, NY-based firm was founded last year and has been managing partner capital since December. The firm this week
announced the launch of its systematic and discretionary absolute return commodity strategies, as well as enhanced index strategies.
Avenue Capital Group, the New York-based company started by Marc Lasry, is raising a new fund to invest in distressed debt, according to a person
familiar with the discussions, Bloomberg reports. The company, which has about $18.5bn of AuM, expects the fund to be about $3bn, with fundraising concluding within three months, said the
person, who declined to be identified because discussions are private. Avenue is raising the new fund after its hedge fund returned about 60% last year, said the person.
PEOPLE MOVES
As part of its continued success and expansion, LV= Asset Management, the fund management arm of mutual insurance and investment group LV=, has appointed Piers
Hillier as CIO. Hillier brings over 20 years’ experience in investment management and business development to the position. Hillier has held a number of senior positions including
investment head at West LB Mellon Asset Management and MD at Deutsche Asset Management.
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Comment: Amy B Hirsch
"It is imperative that investors of all types ensure they understand the relationship between the introducing party and the manager"
Investors sit tight on impaired assets
Playing the ‘what if’ game can be fun but, depending on the number of variables in question, it can get a little out of control. Apply this conceit to the hedge fund sector's performance during the financial crisis and the possible permutations become legion.
Hedge fund inflows in Q2
Hedge inflows have slowed as volatile markets made sitting on the sidelines the safest option in Q2. According to figures from HFR, the quarter’s $9.5bn - a 30% drop from Q1’s $14bn – reflected the 'wait and see' policy of many investors as the HFRI Fund Weighted Composite dropped -2.5%. With nerves setting in, recent predictions of a boom of interest in the alpha potential of smaller managers also fell flat, with the lion’s share of money going to large $5bn-plus managers.
Read MoreFunds of hedge funds fall out of favour
A growing number of institutional investors are now opting to invest directly into hedge funds instead of allocating to the space via funds of hedge funds.
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