There were a few positive numbers to be found, however. the Eurekahedge North American Hedge Fund Index finished the month with positive returns of 0.08%, beating the S&P 500. Managers with positive returns banked on upbeat corporate earnings and the end of April saw a surge caused by speculation of further stimulus from the US Federal Reserve.

Emerging market hedge funds were up 0.54% in the month, bucking the trend from other regions and the underlying markets. Similarly, a 0.51% return by the Mizuho-Eurekahedge Asia Pacific Index showed that the larger asset managers in the region were able to manage volatility in the underlying markets. The index has also notched up strong returns by the end of April 2012 with gains of 5.47%.

Our special report this month focuses on Latin American hedge funds; a sector that has experienced tremendous growth in the last decade jumping from US$2.7 billion to US$58.9 billion in AUM. Latin American hedge funds have also started the year strong attracting US$1.2 billion in 1Q 2012 with gains of US$1.9 billion in perfor

Highlights from this month’s report:

• The asset-weighted Mizuho-Eurekahedge Top 100 Index increased 0.28% in April 2012, signaling a better month for larger funds.
• Hedge funds attracted US$10.4 billion during the month of April.
• Assets in North American hedge funds have increased by nearly US$40 billion since the start of the year.
• Relative value and fixed income hedge funds are a bright light in the industry – they have now witnessed five consecutive months of positive returns with gains of 5.91% and 4.56% respectively.
• Launch activity remained strong in 2012 with more than 150 funds launched worldwide as at the end of April 2012.
• Assets in distressed debt hedge funds were back above US$60 billion.
• The Eurekahedge Latin American Hedge Fund Index saw a surge of 6.45% at end-April 2012.

Jerry Cudzil, a former Morgan Stanley managing director who specialized in trading high-yield debt, has joined the ranks of TCW. He comes to the firm as the Head of U.S. Credit Trading. According to On Wall Street, Cudzil’s position is a new role within the firm.

TCW isn’t the only company acquiring top talent from other firms. On Wall Street reports that Wunderlich Securities has taken four Morgan Keegan execs under its wing. Three of them — Brett Chiles, Haywood Henderson, Tim Ballard — will go to Wunderlich Securities’ Equity Capital Markets division, while Jane Brokaw Lutz (a former financial advisor) will join the firm as the senior VP of the Private Client Group.

The biggest move of all, however, might have come from Chad Clary and Dane Crunk, who left their posts at Merrill Lynch’s Private Banking and Investment Group (a company they had been with since 2006) for the exciting opportunity to build something new. According to On Wall Street, the resulting venture is a financial startup called Syntal Capital Partners.

Based in Midland, Texas, Syntal Capital Partners has already attracted the attention of other Merrill Lynch employees, including Raquel Padilla, Clarissa Kuzmich, Cressinda Hyatt, and Barry Brauchi.

With so many hires going on, and with new firms beginning to pop up, you might be wondering how you can get in on the hiring action — whether it’s on Wall Street or another part of the financial sector. That’s why we created StreetID, a financial career matchmaking site — to take the “wonder” out of your job search.

We built StreetID 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.

James D. Ragan, a senior equity analyst at Crowell, Weedon & Co., recommends that you start by taking an active role in following the financial markets. “Learn about a sector or a group of stocks and become an expert in some areas,” Ragan told StreetID. “Read a lot, pay attention to valuation and how to value companies. It’s basically doing a lot of education to make yourself more desirable in the industry.”

When it comes to younger hires, Crowell, Weedon & Co. is most interested in seeing candidates who possess or are pursuing a Chartered Financial Analyst (CFA) program. “[It] is a fairly rigorous program,” said Ragan. “It shows a level of commitment on their part, but then also we believe that the program is very valuable as well. That’s kind of a minimum that we look for these days; somebody that’s pursuing that, the CFA designation.”

Overall, Ragan said that Crowell, Weedon & Co. typically hires people that are a little bit more experienced. “We want someone who’s got experience in the industry; someone who demonstrated capability on valuing stocks, valuing industries,” Ragan explained. “We want someone who’s well-rounded. They need to have a desire to pursue the sale side of the business as well, and be willing to get out there with industry contacts and meet with customers and clients. It’s not just the analytical side — it’s the interpersonal skills as well.”

Finally, Ragan took a moment to speak about the challenges that Wall Street has been experiencing.

“I think that Wall Street has gone through a tough period,” said Ragan. “There aren’t as many jobs out there as there used to be. The industry is changing more to be kind of an institutional-driven model. I think there are jobs out there but it’s hard to find. I think it’s still a very appealing career.”

Ragan’s right — it isn’t always easy to find work on Wall Street. But that’s where we come in. We’re StreetID, a financial career matchmaking site that we built 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.

Or anywhere else, for that matter. It turns out that social media — a tool designed to bring us closer together — might actually be driving us farther apart.

“I think there’s still no substitute for picking up the telephone and calling people up — doing face-to-face [communication],” hedge fund manager Eric Jackson told StreetID. “When I grew up, a lot of people didn’t like to do that because they felt shy or whatever, and they think someone’s not gonna take their call. But now I think it’s gotten worse for people in their teens and early 20s who have grown up on social media and video games. They get really comfortable behind e-mail and texting and prefer that to doing the face-to-face thing or the phone-to-phone thing.”

But Jackson, who is the founder and managing member of Ironfire capital, insists that e-mail is not enough. “People hit delete all the time on spam e-mail or spam introductions on LinkedIn from people that are connected to the target, but maybe the target doesn’t remember connecting with them — that sort of thing,” Jackson warned.

“The best bet is always to be bold and reach out to people. If you look at the people in the world that are successful on Wall Street, they always seem to have stories like this where they just called up some legend and got them on the phone and got an internship out of it. I think that’s the way to go.”

Originality Reigns Supreme

Aside from being bold, Jackson said that you should also have “something unique that kind of catches their interest or makes them want to call you back.”

“If you don’t get them, leave a message or something,” Jackson advised. “You need to be really creative. You need to sort of think about it from their perspective and what’s going to stand out.”

Jackson said that he thinks targeting people who went to your college is still a “huge thing.”

“The chances are pretty good that if you approach someone and said, ‘Hey, I went to your college,’ and you have nothing else in common with them, out of courtesy they’ll at least give you a call back,” said Jackson. “If you don’t have that luxury or similarity, you need to think of something in your own background that’s kind of new and different.”

For example, Jackson recalled his online activist campaign for Yahoo! “It was just amazing that, as that played out (and afterwards), I would call people up or they’d contact me, [people] that I really respected and admired, and [they] had heard about me and what I did,” said Jackson. “It became a great calling card for me. If I was able to send a blind e-mail or call someone and drop that in, that was a good way of [starting the conversation].”

Ultimately, Jackson said you don’t have to do that. “You just have to be original and creative in thinking about why you are special — what’s unique about you.”

“And then once you get past that hurdle,” Jackson added, “and you’re talking to the person that you want to connect with or get a job with, you have to be able to show that you’re a hardworking, intelligent person with some creative ideas.”

Getting Hired at Ironfire Capital

When asked what Jackson looks for in a new hire, he stressed the importance of his prior recommendations.

“If they took my advice and were able to make some kind of connection to my past — where I went to school — or if they showed a lot of knowledge about some things or views that I’ve written about, or talked about, what Ironfire had done,” said Jackson, who, in addition to his duties at Ironfire Capital, is a frequent contributor to Forbes and CNBC. “It’s amazing to me that the vast majority of people show no interest in doing some homework on somebody before they call them up. So if somebody did that, that would catch my interest.”

If not, Jackson said that he is simply looking at a sea of resumes. “I’m gonna default to [things like]: where did they go to college?” Jackson explained. “Where [have] they worked? How smart are they? Are there some kinds of (depending on how old they are) standardized test scores to compare them to? And if there are any personal connections from their past work experience, did they work somewhere where I know somebody? And so forth.”

Proofread Your Resume

Finally, Jackson took a moment to go over a few critical resume tips.

“Don’t have spelling mistakes,” Jackson insisted. “That’s a big one. That immediately disqualifies [a lot of candidates]. It’s a lazy error. If they’re lazy in making spelling mistakes on their resume, then chances are — at least in my view — they’re gonna do the same on the job.”

Further, Jackson said that lengthy resumes are not recommended. “Keep it to a page,” he said. “Some people include an ‘interests’ section. They’ll go on and on about how they like to knit or something. It kind of worries me. Keep it short and sweet and professional. Show me the goods. It’s representative of you — so if it’s sloppy, chances are future reports and studies that you do on the job will be sloppy, too. You want to give a preview of the work that’s to come.”

Where to Start

Before you begin your quest for Wall Street success, take a moment to visit our financial career matchmaking site, StreetID. We built StreetID 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.

Be very careful if you recently retired or came into money and you’re looking for a safe investment. You could be a very attractive target for a crook. Once your money is gone, it can be impossible to get it back.

Mass Market Fraud

Mass Market Fraud is a type of fraud which aims to make victims part with their money by promising cash, prizes, services and high returns on investment. Examples include foreign lotteries, ‘boiler room’ frauds, correspondence scams where fraudsters purport to act on behalf of bona fide charities and institutions and ask you to provide money and personal information. The majority of these frauds are committed from overseas by way of email, telephone or letter to victims. Classic scams include: “Congratulations! You’ve won the X Lottery!”; a ‘cold caller’ phones offering high returns on new stock listings and other stocks;  off plan real estate investment via brochure;  an email claiming that a friend abroad has lost her money, cards etc. ; a request for charity from Africa or a lottery requiring personal bank details.

Commodity Scams

• Be wary of any firm or individual offering to sell you commodity futures or options on commodities, including: precious metals, such as silver or gold; foreign currency, such as Euros, Yen or Deutschmarks; or crude oil, heating oil, unleaded gas, or agricultural products such as corn, soybeans, or cattle. Be wary of any firm or individual offering to trade your money for you in commodity futures or options, or to pool your money with other customers.
• Predictions or guarantees of large profits. Always get as much information as you can about a firm or individual’s track record and verify that information—even if you know the people involved or they are recommended by friends or relatives. If you can’t get solid information about your investment and the company, don’t invest. Before you invest, always check it out with someone whose financial advice you can trust.
• Promises of little or no financial risk. Be suspicious if the firm or individual says there is little risk. Be suspicious if someone tells you that a written risk disclosure statement is only a routine formality. Written risk disclosure statements are important to read thoroughly and understand.
• Claims of trading in the “Interbank Market.” If a firm claims that they will trade foreign currency for you in the interbank market, or that you should trade in the interbank market, be cautious. The term “interbank market” refers to a loose network of currency transactions negotiated between financial institutions, usually banks and investment banks, and other large companies.

Ultimately – the real truth is that …… if it sounds too good to be true, then it most certainly is.

Some Hedge Fund investor questions suggested by UK Serious Fraud Office

1. Are you satisfied that the fund has a truly independent board in place?
2. Do members of the board also hold posts on a large number of other boards?
3. Is the fund exempt from regulatory oversight?
4. Has the fund disclosed an external, independent well known auditor?
5. Is the fund manager controlling valuations and providing portfolio prices and is it difficult to verify the value of the assets?
6. Is the fund valued independently
7. Have the prime brokerage, auditor, directors or administrators changed?
8. Do many employees leave the organization and do key members of staff have any criminal records or are involved in civil disputes?
9. Have there been any regulatory actions against the hedge fund manager?  Have the fund managers consistently displayed perfect market timing (the Madoff scam)?
10. Have there been unusual transfers or activity near a quarter or year end?
11. Is there an apparent restriction on access to the fund to elite investors?
12. Has the fund taken large positions in companies? This may indicate an intention to sell a proportion of the holdings to influence the value of the remainder.
13. Have there been any market rumors and/or complaints from investors about the fund and its management? Is there inadequate disclosures and transparency on trading positions?
14. Have there been any misrepresentations in investor communications? This may be in relation to returns or the background of the fund managers.
15. Have the returns displayed month on month been inconsistent with the indices and the performance of peers?
16. Are key functions of the business controlled by a tiny group?
17. Is the administrator knowledgeable about the fund strategy and independent
18. Are you satisfied that there is an independent custodian?
19. Have redemptions been actively discouraged.  Have there been many redemption requests?  Have there been any failures to honor redemption requests?
20. Have the financial reports been timely, are the reports easy to understand and is the manager responsive to questions?

Journalist Neil Behrmann is author of Trader Jack: The Story of Jack Miner, about a teenager caught up in a Russian Mafia and hedge fund fraud (www.thestoryofjackminer.com).

In summary, the bill calls for the following:

• The creation of an advisory industry SRO with full rule-making and examination authority over SEC and state registered advisers

• The SRO would be registered with the SEC and report to the SEC for approval regarding its program – similar to how FINRA currently reports to the SEC

• The SRO would have authority over both registered entities and the associated persons of such entities, again like FINRA

• Exemptions for SRO registration are contained in the bill and include certain exemptions for state registered advisers that reside in states with formal examination programs that allow for state exams once every four years

• The bill strives for a balance between SEC, state, and SRO regulation of advisers

FINRA, the primary broker-dealer industry SRO, has long been a proponent of an adviser SRO and has been lobbying Congress for its formation. In opposition, the Investment Adviser Association (IAA), an industry trade group for advisers, has increased its lobbying efforts to oppose the new bill. For now, it appears that the bill may be brought to the house floor for vote as early as May 2012.

Read the full post on Evan Rapoport’s Capital Introduction Blog

Say hello to the JOBS act, which stands for, Jumpstart Our Business Startups Act. “This legislation is intended to help start-ups raise capital and go public, and is positioned as a bill with bipartisan support aimed at making it easier for small businesses to find investors early and to continue to grow in the public markets by lowering some of the bureaucratic barriers. It also promotes “crowd-funding,” a mechanism by which entrepreneurs can raise up to $1 million online from individual investors with minimal financial disclosure.” (I took part of this definition from an article somewhere)  But most important of all, it lifts the almost 80 year old ban on hedge fund advertising.

This is a monumental change in the way hedge funds will now be able to market themselves.  Some colorful ideas are in articles like this one: http://blogs.wsj.com/deals/2012/03/28/jobs-bill-opens-door-to-hedgie-advertising/.


Now frankly, while it is fun to think about the possibility of firms like Paulson & Co. and D.E. Shaw naming stadium after themselves, (narcissists!) in my opinion, the biggest beneficiaries of this rule change will be the emerging hedge fund managers.  Emerging managers, those with under 50mm in assets and less than 5 year track records, consistently have the hardest time getting their message out to the investor community despite consistently outperforming the billion dollar plus managers.  The reasons why they have a hard time raising assets are fairly simple.  The largest reason being, institutional investors have been slow to adopt emerging manager investing.  Other reasons include investors not wanting to be too large of a percentage of total fund AUM, restrictions on any fund with less than 3 year track record, certain pedigree requirements and also select service provider requirements.  I believe this bias away from emerging manager investing is changing, however, with the proliferation of separately managed accounts because more institutions are willing to make an investment with an emerging manager (with a great track record of course) due the high degree of transparency and liquidity the SMA structure provides.  Now the problem is, how does an emerging manager get in front of institutions?  By advertising of course! Prior to the JOBS act, there were/are (at the time I am writing this) very few ways a small manager can get in front of investors.  Some of the only ways are through friends and family, existing contacts and colleagues, hedge fund databases (like my own, HedgeCo.Net), investor conferences and small RIA introductions.  I would say third party marketers/broker dealers, but there are very few, if any 3pm shops that take on new or sub 50mm funds. I also might say capital introduction groups at the Prime Brokers or Mini Prime Brokers, but they don’t ever provide service to smaller funds (regardless of what they tell you!)  So advertising is frankly one of the only ways that talented managers can get their strategies in front of thousands, dare I say millions, of people within a reasonable time frame at a cost that more than likely won’t break their budget.  This is truly a game changer for those fund managers who have great track records and no marketing connections.

View full blog entry on Evan Rapoport’s Capital Introduction Blog