At the same time, Martenson told StreetID that he “can’t see the direct evidence” that regulation is hurting job growth, as some of have argued.

“Certainly it has a lot of additional costs that it is imposing,” he said. “And I think the regulatory environment is becoming more difficult over time, not less. Those are just additional burdens we’re gonna have to factor in.

“Right now there is just so much liquidity in the system that it’s pretty hard to dent it with anything. Should that turn around — should we enter a recession and liquidity gets tight again, or the Federal Reserve is forced to raise interest rates — then I would expect the impact on the financial industry to be fairly significant.”

By that same token, Martenson does not believe that the new regulations are creating jobs either. “If it is, it’s not really showing up in the data I’m looking at,” he said. “It’s such a small number relative to the pool.

“Remember that the government in total has about 22 million people working for it. So if they hire a few extra thousand, it really doesn’t show up in the numbers very strongly at this point.”

Looking ahead, Martenson believes that the industry trends are calling for more consolidation.

“Until and unless we get some really large broad-based organic recovery, and by which I mean one that is not directly tied to the Fed printing $85 billion a month or other stimulus efforts, the trend would call for a lot more consolidation within the industry,” said Martenson. “On a broad job numbers basis, I would expect that to fall most heavily on the mid- to low-end of that spectrum.”

Initially, the consolidations could have a familiar effect on the industry: additional jobs losses.

“At first it’s gonna be just job losses, I would imagine,” Martenson speculated. “There are certainly fewer jobs for middle- to lower-management around the financial sector at this point in time. It’s one of the trends I’ve been tracking for a while in the financial services industry.”

That is not the only important trend to watch.

“We’ve also got another fairly significant trend in here, which is that we have 10,000 Baby Boomers a day retiring,” Martenson added. “Many of them are becoming less and less active in the investment side of their lives, so there’s going to be less need for investment activities on their behalf. So it really remains to be seen if the younger generations can come in and enter the savings and investments cycle.”

That trend is one of the “primary reasons” Martenson is expecting more consolidation from the industry.

“The demographics are just not there to support the kind of industry we built up through the period of time when the Boomers started retiring, which was January 1, 2008, I believe,” he said.

Get Hired Now

These days, job seekers have a million options, but we know where they should turn: StreetID. We built StreetID (a financial career matchmaking website) from the ground up to accommodate Wall Street’s growing community of financial professionals. In good times and in bad, current job seekers and those looking to move on in the future can turn to StreetID and sign up for a free account and make a direct connection with relevant candidates and employers.

“It’s a hard industry to break into if you don’t know the right people or don’t have the capacity to learn very quickly,” said Will Thompson, co-founder and CEO of HedgeComm, a marketing and PR agency that focuses on the alternative investment industry. “I put the emphasis more on the second than the first because you can always meet people. If you can’t learn quickly, that’s just something you can’t do.”

Thompson said that there is a “massive amount of info” that job seekers have to absorb before joining a hedge fund.

“We’re required to watch the commodities market, the equities market, understand what is going on there so we can find opportunities for our clients,” he said. “So you’ve got to understand finance.”

Thus, Thompson said that “unless you can learn really, really fast, you’re not gonna have the industry knowledge that you need to serve your clients.”

“I think that’s the biggest obstacle and barrier to entry in getting into hedge funds — getting that institutional knowledge,” he said.

Get Hired Now

These days, job seekers have a million options, but we know where they should turn: StreetID. We built StreetID (a financial career matchmaking website) from the ground up to accommodate Wall Street’s growing community of financial professionals. In good times and in bad, current job seekers and those looking to move on in the future can turn to StreetID and sign up for a free account and make a direct connection with relevant candidates and employers.

The New Hedge Fund Study: 2012 Edition, has revealed that 64% of new funds covered by the study had equity or equity-related strategies, up 14% from the 2011 study.

Of the 64% of new funds involved in equity or equity-related strategies, Seward & Kissel found that about 55% were focused on U.S. and North American equities and approximately 30% had a sector focus, with the most popular sector focuses being healthcare and TMT.

Key Findings

– In 2012, 64% of new hedge funds had equity or equity-related strategies (up 14% from the 2011 study).

– Management fees were generally higher for non-equity strategies, while incentive allocation rates continued to be pegged at 20% of annual net profits across all strategies.

– More funds permitted monthly redemptions in 2012 as compared to 2011 (the percentage increased from about 25% in 2011 to 36% in 2012), and a higher percentage of equity strategies had lockups or gates as compared to non-equity strategies.

– Sponsors of both U.S. and offshore funds set up master-feeder structures over 80% of the time. Most offshore funds were established in the Cayman Islands.

– In the area of seed capital, the initial funding in many of the bigger deals was between $75 million and $150 million typically locked up for two or three years; for the smaller deals, the amounts ranged from $10 million to $50 million. The full study is available here.

New York hedge fund law firm Sadis & Goldberg has issued an alert explaining the consequences of the Directive for U.S. based investment advisers acting as a manager to an alternative investment fund (“AIF”) based in the EU or that manages a non-EU fund (e.g., Delaware, Cayman) and markets the non-EU fund to investors in the EU. Investment advisers must comply with the first phase of the Directive by July 22, 2013 or carefully understand the nuances of the relevant exemptions in order to remain outside of the scope of the Directive.

Next steps for Non-EU based Investment Advisers

Advisers who plan to market funds to any EU member state after July 21, 2013 will need to:

Determine whether marketing undertaken after July 21, 2013 is at the initiative of the relevant EU based investors.
Check and monitor the status of co-operation arrangements.
Review contents of any private placement memorandum or other marketing materials.
Establish systems and controls for preparation of an annual report to investors
Establish place systems and controls for preparation of the periodic and regular disclosure to investors.
Review and monitor implementation of provisions of the Directive governing the obligations of AIFMs.

Conclusion: It would be prudent for advisers based in the US (and/or non-EU AIFMs) to consider their options and start planning for the new requirements under the Directive.

George Jarkesy – Opportunist Magazine

George Jarkesy, the 37-year-old Nationally Syndicated right-wing talk show host turned Hedge Fund manager was charged by the SEC on March 23rd for Fraud in his Hedge Fund.

In his radio show George Jarkesy proclaims himself as a “Defender of Capitalism”, and rails against the government manipulating the market to the hurt of investors. Ironically the SEC is charging Jarkesy and John Thomas Capital Management of inflating valuations of the funds’ assets, causing the value of investors’ shares to be overstated and his management and incentive fees to be increased.

Among other charges listed the SEC also details a pump-and-dump scheme where Jarkesy used “fund assets to hire multiple stock promoters in 2010 and 2011 to create an artificial and unsustainable spike in the price of two microcap stocks in which the funds were heavily invested.”

Heavily involved in politics, CampaignMoney.com  reports that George Jarkesy donated $21,000 to Republican political parties in the 2012 election cycle including $5,000 directly from John Thomas Capital Management Group to the campaign of John Roger Williams, and $15,000 to the Republican National Committee.

John Thomas Capital Management is now rebranded to Patriot28, their website does not appear to be accepting new investors or allowing online access to their investors.

More information at the New York Post article and at CourtHouseNews

Before applying for a job with a hedge fund, it’s important to know what the industry wants most when acquiring new talent. To find out, StreetID turned to Evan Rapoport, CEO of HedgeCo Networks.

First and foremost, hedge funds want loyalty. “Someone that is dedicated to the firm,” said Rapoport. “I think that’s something we look for over here also. Not just during the work hours, but also thinking about the company after hours and how you can help to improve the product at the firm.”

Loyalty is especially important to hedge funds because of the level of sensitive — and often proprietary — information that is shared with employees.

“You’re not just looking for someone to come in and learn all about your strategy and how you operate and then move to another firm or spin off their own firm,” said Rapoport. “This industry is not one that [fosters] a 9-to-5 job. You want someone that will come in early and put in those extra hours — even on the weekend, when necessary — because your benefits are going to be exponential.”

If a hedge fund is hiring a senior exec, “You want to make sure this person has done this before and can operate at the highest level because, again, we are talking about other people’s money,” Rapoport explained.

“You want to make sure that you are very careful with the people that you hire, and who you’re giving responsibility to. It’s not just your responsibility as a fund, it’s a responsibility to the end investor.”

Get Hired Now

These days, job seekers have a million options, but we know where they should turn: StreetID. We built StreetID (a financial career matchmaking website) from the ground up to accommodate Wall Street’s growing community of financial professionals. In good times and in bad, current job seekers and those looking to move on in the future can turn to StreetID and sign up for a free account and make a direct connection with relevant candidates and employers.

JPMorgan Chase is one of many multinational institutions that endured a scandal last year. When that happens, investors often run for the hills. But job seekers might want to take a closer look, as these corporations frequently need people to help turn things around.

Dr. Ray Benedetto, co-author of It’s My Company Too!: How Entangled Companies Move Beyond Employee Engagement For Remarkable Results, said that new job opportunities are “absolutely” created from major scandals.

To benefit from these unique opportunities, Benedetto recommends that job seekers “pursue a study of leadership versus management.”

“For the technical side, your folks in finance, they’re very good with the numbers,” he told StreetID. “They’ve got to be good with numbers. But that’s a technical skill — it’s around planning, organizing, staffing, directing, all those things that go to processes. Finance is very good with processes.”

“But,” he added, “we get things done through people.”

“That’s the right side of the brain, that’s the nurturing side of the brain, and that’s what most people have not gotten in their schooling,” said Benedetto. “They have not been developed as leaders. So I tell any one of my junior colleagues, ‘You need to have a good foundation in leadership. If you expect to get anywhere, if you expect to bring about change, and serve as a change agent, you must be an effective leader.’”

Benedetto said that the job seekers must go above and beyond the norm. “How well do you understand organizational design and structures and how all these functions work together?” he asked. “That’s where auditors do really well because they have to learn about all aspects of an organization.”

In fact, if you are looking to bring change to an organization and/or step in during a crisis, Benedetto suggests working as an auditor with a company that does valuations. That way you can “actually get in there and look at how a company is valued based upon the systems in place.”

Further, Benedetto said that job seekers should peruse the Baldrige Program to see the criteria that is used to judge the best companies in America.

“Do your due diligence,” said Benedetto. “If there’s an organization that is sitting on top of a potential innovation base but just isn’t moving things, then that’s an opportunity.”

That said, you shouldn’t go into a company unless you are completely prepared for the job. “When a company is in crisis, that’s not when you want to get in there unless you are committed to being a turnaround specialist,” said Benedetto. “I have dealt with organizations at all different levels, and I’ll tell you, crisis is tough because, when an organization is in crisis, people are just worried about their day-to-day survival and just keeping their head down.

“I would not recommend that anyone who is in their mid career [decide] to take on a crisis situation. I would recommend they learn from seniors who are experienced in turnaround.”

Additionally, “You need to find a mentor,” Benedetto insisted. “Junior- to mid-career professionals must find a mentor [in the field] who they respect [and] who has been successful in a number of venues who they can then have this dialogue and learn from. A formal mentor/mentee relationship can do a lot for helping people learn about the broader venue in which they operate without risk.”

Get Hired Now

These days, job seekers have a million options, but we know where they should turn: StreetID. We built StreetID (a financial career matchmaking website) from the ground up to accommodate Wall Street’s growing community of financial professionals. In good times and in bad, current job seekers and those looking to move on in the future can turn to StreetID and sign up for a free account and make a direct connection with relevant candidates and employers.

Up until last year, he brought most of his wealth to Greenwich, Connecticut. That changed as soon as the state raised its taxes.

“When they did that, it forced out one of their wealthiest residents,” said Evan Rapoport, CEO of HedgeCo Networks. “Eddie Lampert was, I think, the fifth wealthiest person in Connecticut. He’s worth about $3 billion.”

For Lampert, “The jump in state taxes was one of the reasons that he moved out of Connecticut,” said Rapoport.

“Potentially he was a forward-thinker, as I think a lot of hedge fund managers are, and had the foresight to see this trend in increased taxation as a result of the large amount of debt we carry both as a nation and in certain states and municipalities,” he said. “Understanding that taxation was going to increase, by Eddie moving to Miami and relocating, he saved himself not only the state taxes, but of course any city taxes that would exist.

Florida is not merely an alternative to Connecticut, however. It is also proving to be a popular alternative to New York.

“For a person that earns a million dollars, the difference in savings from someone that lives in New York versus someone that lives in Florida is $147,000 just from state and city taxes,” said Rapoport. “That’s 14.7 percent just in savings to live in Florida versus living in New York City.”

Best of all, financial professionals don’t have to be in Florida full-time. “You have to be here more than six months and have a residence here,” Rapoport explained. “But let me tell you, from saving $147,000, you could certainly rent a very nice house for over $10,000 a month or purchase a very nice house for over $10,000 a month and be down here and go back to New York when you need to.”

That, of course, is another benefit of being in Florida: the great accessibility to New York.

“If I need to be in New York City, I can hop on a flight from Palm Beach International Airport — which is 10 minutes away from us — and I can be in NYC in two-and-a-half hours,” said Rapoport. “I hop on a six-o-clock flight, I’m in NY by 8:30, I’m in the city by 9:00 or 9:30 and I can start taking meetings. That’s very easy.”

“In fact, I would compare that to some commutes from people in Connecticut who have an hour-and-a-half to two-hour commute from door to door, maybe more,” Rapoport added. “It’s not that different.”

Like many financial firms located outside of New York, HedgeCo Networks has an office in NYC.

“What we do is, senior management and our headquarters are down here in Florida, but we still keep a sales office in New York City, and we come up to New York when needed,” said Rapoport. “I think that’s one of the better ways to play this, if you will, and still have the networking opportunities and the abilities to take multiple investor meetings in a single day.”

That said, there are some firms that would be better off in New York.

“There is no comparison relative to the investor base in New York City, especially the institutional investor base versus down here in Florida,” said Rapoport. “But if you’re a young, emerging fund that needs to get out there and spread the word, I think you’re better suited in New York than you would be down in Florida.

“But for those that are more established and can have multiple offices, it certainly is a huge benefit just to be down here from a taxation perspective.”

In addition to the tax benefits, Rapoport also praised the lower cost of living. “For fun, before I went on Fox Business the other night, I ran a cost of living calculator,” he said. “What I found was that someone that made $500,000 in Florida, the equivalent in New York City would be well over a million dollars. That’s a pretty big difference — almost double the cost of living (forgetting taxation, by the way, on top of that), to live in New York versus Florida.

“That is also another impetus behind people moving from New York to Florida — it’s simply more affordable. Property taxes are less, commercial real estate is less, so the operational expense of owning a business is less down here than it would be in New York City.”

Those who are looking ahead will also benefit.

“How about this: there’s no estate tax here in Florida,” said Rapoport. “So while we’ve talked about no state taxes, that also applies at the estate level. So if you’re estate planning, and if you’re thinking about your future, and God forbid you’re passing, when you’re planning you would save anywhere from six to 10 percent on your estate. That’s a big savings for your family.”

Rapoport also appreciates the access to Latin America, “Which is obviously enormous down here in South Florida,” he said.

“Miami, surprising to some, has the second-largest concentration of international and national banks here in the country,” he added. “It has become a large hub not only for Latin America but for Europe and for Asia.”

But it’s not just about taxes, cost of living expenses and other savings. Florida also provides its residents with an incredible lifestyle.

“On top of taxes you also have a lifestyle down here that is very good, in my opinion,” said Rapoport. “What I mean by that is, if you’re someone that likes the outdoors — we’ve always had great weather, but the ability to play golf year-round, tennis, go boating, fishing — those are all tremendous benefits to being here in Florida.”

The corporate lifestyle is also very good. “It’s not uncommon to walk into a hedge fund manager’s office in Florida and find everybody in khakis and golf shirts,” Rapoport added. “In the summer, find those same people in shorts and golf shirts and sandals. Being comfortable and coming to work and having a relaxed corporate lifestyle is also a huge benefit to being down here.

“One of the reasons I enjoy being here, certainly, is that lifestyle. It’s one of the reasons I made that shift. Frankly I got tired of being in NYC and spending my weekends either taking long travels out to The Hamptons or the Jersey Shore in the summers or in the winters going to the stores and shopping and spending and not really enjoying some of those outdoor activities as much as I could down here.”

Rapoport said that he can sum up the benefits of Florida in just six words: “Affordability, availability, no snow, no subways.”

Get Hired Now

These days, job seekers have a million options, but we know where they should turn: StreetID. We built StreetID (a financial career matchmaking website) from the ground up to accommodate Wall Street’s growing community of financial professionals. In good times and in bad, current job seekers and those looking to move on in the future can turn to StreetID and sign up for a free account and make a direct connection with relevant candidates and employers.

Evan Rapoport, CEO of HedgeCo Networks, recently lured Brett Langbert away from New York City. With more than 17 years of experience (he spent 12 years at Goldman Sachs and five years at Morgan Stanley; he was also a managing director at UBS), Langbert had become a Wall Street vet.

Rapoport told StreetID that if his company was in New York, “I would be competing with all of the banks, and I think would probably not win out in that battle.”

“But because of the allure down here in Florida and Brett wanting to have a change in his lifestyle and his family’s lifestyle, we were able to bring him down here and hire him and bring him on the team,” he said.

For Langbert, the benefits of moving have been immeasurable.

“When Brett was in New York City and working on Wall Street, he would have to leave his house at 4:30 in the morning from Basking Ridge, New Jersey to drive to New York City,” said Rapoport. “He’d pay the tolls, pay for gas, pay the parking (which was $50 a day or whatever the number was, which was substantial), and then get home late in the evening and never see his kids. So he missed out on a large portion of their childhood because he simply wasn’t there.

“Now, by being in Florida, he’s able to come to work at 8:30, leave at 5:30, his commute is 15 minutes, there are no tolls on the way, and he’s able to enjoy his kids’ childhood. That’s something you can never get back.”

Rapoport said that job seekers “really have to think about that sometimes — is it work to live, is it live to work — and what’s most important to you as a person.

“I think sometimes some of these other factors really become more important than just your geographic location and maybe more money,” he said. “But because of the pickup in taxation [in other states] and the affordable lifestyle down here, you sort of do end up making more money.”

Get Hired Now

These days, job seekers have a million options, but we know where they should turn: StreetID. We built StreetID (a financial career matchmaking website) from the ground up to accommodate Wall Street’s growing community of financial professionals. In good times and in bad, current job seekers and those looking to move on in the future can turn to StreetID and sign up for a free account and make a direct connection with relevant candidates and employers.

On the other hand, job seekers that are still employed must find a way to carefully navigate their current employer. This is no easy task, particularly when it comes to going on interviews. But it is a task that must be completed successfully in order to avoid a tricky (if not awful) situation.

One of the more secretive elements of a job search is the interview. If it is impossible to conduct the interview after hours or during lunch, the job seeker must find a way to fit it into his or her current schedule.

“In a situation such as this, the candidate does need to discuss it with the potential boss,” Skip Freeman, author of “Headhunter” Hiring Secrets: The Rules of the Hiring Game Have Changed . . . Forever!, told StreetID. Freeman said that it is important to take the “professional and appropriate first step” in checking with the potential employer’s availability.

If the employer cannot conduct the interview before or after work, and if it is impossible to conduct it during lunch, Freeman said that the candidate should “take a half-day of work off if he really wants a shot at the opportunity.”

“Some companies don’t require anybody to say anything,” he said. “The employee just submits a request through human resources and it’s done. Other companies do ask for a reason. In that case I would say, ‘family situation.’ Because, unless Bob is not married, it is a family situation. He’s trying to better himself and his career in regard to providing for and taking care of his family.”

If the candidate is single, then “the only thing that could be said without lying is, ‘personal situation.’”

“Obviously never tell your boss you’re going on a job interview but one should not lie either,” said Freeman. “One is never required to give their employer the personal details of their life so ‘family situation’ is appropriately vague without showing the cards in your hand and also without lying.”

Get Hired Now

These days, job seekers have a million options, but we know where they should turn: StreetID. We built StreetID (a financial career matchmaking website) from the ground up to accommodate Wall Street’s growing community of financial professionals. In good times and in bad, current job seekers and those looking to move on in the future can turn to StreetID and sign up for a free account and make a direct connection with relevant candidates and employers.