Each business day HedgeCo.Net keeps you informed with the top hedge fund industry news, opinion and insight from around the globe. From the latest hedge fund launches, to the impact of regulation, competition, and investor activism - we track the topics and people that make a difference to you.
Reuters — The newest Goldman Sachs insider trading probe is focused on a San Francisco-based investment banker suspected of tipping off a hedge fund manager about two health care deals, according to a source who could not be identified.
Federal prosecutors in Los Angeles are looking into whether Matthew Korenberg told Galleon Group founder Raj Rajaratnam of acquisitions of Advanced Medical Optics and MedImmune in 2009 and 2007, respectively, before the deals were made public, the source said.
New York (HedgeCo.net) – Financial Research Associates (FRA) is proud to bring back the highly acclaimed Private Investment Funds Tax Master Class in New York City at the Princeton Club of NYC on Monday, May 7 and will continue through Tuesday, May 8, 2012. Ensure absolute tax efficiency and compliance by attending the BIGGEST tax event of the year!
This unique conference features the Tax Practices for Private Equity Funds program and the Effective Hedge Fund Tax Practices program and brings them together to run concurrently, giving attendees the benefit of mixing and matching sessions according to their preference. Plus, earn 14.5 CPE and CLE* Credits!
About Financial Research Associates:
Financial Research Associates (FRA) provides the financial community with access to business information and networking opportunities. Offering highly targeted conferences, FRA is a preferred resource for executives and managers seeking cutting-edge information on the next wave of business opportunities. For additional information on Financial Research Associates (FRA), please visit their website at: www.frallc.com.
Contact:
Erin Busch, Financial Research Associates (FRA)
ebusch@frallc.com
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New York (HedgeCo.net) – Morningstar reported preliminary hedge fund performance for March and for the first quarter as well as estimated asset flows through February 2012. The Morningstar MSCI Composite Hedge Fund Index, an asset-weighted composite of nearly 1,000 hedge funds in the Morningstar Hedge Fund database, eked out a 0.1% rise in March, ending the first quarter up 3.3%.
“After a strong start in the first two months of 2012, hedge funds lost steam in March and presented a mixed picture,” said Terry Tian, alternative investments analyst with Morningstar. “While many U.S. equity strategies delivered positive returns, emerging markets, managed futures, and currency strategies suffered losses.”
The U.S. stock market continued to rally in March—the S&P 500 Index and the Russell 2000 Index rose 3.3% and 2.6% for the month, respectively, finishing the first quarter up 12.6% and 12.4%, respectively.
The Morningstar MSCI North America Hedge Fund Index, which includes hedge funds investing primarily in U.S. stocks, rose only 0.5% in March and 5.5% for the first quarter. Hedge funds that invested in smallercapitalization stocks, however, outperformed. The Morningstar MSCI Small & Mid Cap Hedge Fund Index advanced 1.1% in March, finishing the first quarter up 10.8%.
Emerging-markets oriented hedge funds struggled in March due to weaker-than-expected economic data from China. The MSCI China NR Index dropped 6.9% and the MSCI Emerging Markets NR Index fell 3.3% in March. The Morningstar MSCI Emerging Markets Hedge Fund Index declined 0.9% for the month. March proved to be another difficult month for managed futures strategies, as the lack of trends in most markets (such as crude oil and soft commodities) and reversals in some others (precious metals and currencies, for example) contributed to losses.
The Morningstar MSCI Systematic Trading Hedge Fund Index declined 1.9% in March, ending the first quarter down 0.4%. Currency strategies experienced significant losses in March—the Morningstar MSCI Currencies Hedge Fund Index plummeted 4.9%, making it the worst-performing Morningstar MSCI Hedge Fund Index for the month. Commodity currencies, such as the Australian Dollar, Norwegian Krone, and Canadian Dollar, responded to the renewed concerns over China’s growth and fell sharply in March, reversing their upward trends since the beginning of the year.
In February, single-manager hedge funds saw outflows of $708 million, while funds of hedge funds gathered $49 million after eight consecutive months of outflows. The U.S. long/short equity category experienced the heaviest redemptions among all single-manager categories, bleeding $1.2 billion. The diversified arbitrage and long/short debt categories received inflows of $482 million and $348 million, respectively.
March returns for the Morningstar MSCI Hedge Fund Indexes and February asset flows are based on funds
that reported as of April 18, 2012. Hedge fund investors, managers, consultants, and advisors can access
additional information through Morningstar Direct SM, the company’s global research platform for institutions.
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Reuters – A former Morgan Stanley executive settled with U.S. securities regulators in connection with real estate investments in China and prosecutors have filed a related criminal case, the Securities and Exchange Commission said on Wednesday [April 25].
Garth Peterson, who was a managing director in Morgan Stanley’s real estate investment and fund advisory business, secretly acquired millions of dollars worth of real estate investments for himself and an influential Chinese official, the SEC said.
Forbes – George Soros, founder of the second-best-performing hedge fund of all time, the Quantum Fund, bought 6 million shares of Openwave (OPWV) on April 10 at approximately $2.41 per share, as reported by GuruFocus Real Time Picks. Soros had previously built up a position of 176,100 shares in the first quarter of 2010 around the price of $2.50, and gradually sold out as the price never substantially increased.
On April 16, Openwave announced that it would sell one of its three core units – the mediation and messaging products business – to a private equity firm. The company had announced that it was positioning itself for such a sale in its second-quarter fiscal 2012 results issued February 1.
Business Insider – Hedge funds have received quite a battering in the financial press of late. Persistently disappointing results have rightly drawn attention to the high fees, opaque strategies and limited liquidity that characterize much of the industry.
My recent book, The Hedge Fund Mirage, has helped promote a long overdue debate about how investors should access some of the most talented money managers around. Although in aggregate all the money ever invested in hedge funds would have been better off in treasury bills, there are and probably always will be fantastic managers and happy clients. However, in recent years these have increasingly become the exception.
Bloomberg – For asset managers seeking hedge fund-like returns on the cheap, Man Group Plc is now offering the biggest discount on record.
The world’s largest publicly traded hedge-fund manager was valued at 0.65 times net assets this week before takeover speculation lifted Man Group’s stock from its lowest price in more than a decade, according to data compiled by Bloomberg. The London-based company also had about $1.7 billion in cash, more than any investment management firm in the industrialized world relative to its market value, the data show.
New York – HedgeCo has launched RIA Websites, a division specializing in technology solutions specific to the investment advisory industry. RIA Websites will leverage the technology built by HedgeCo Websites and provide clients with website licensing with built-in CRM and content management tools.
“We have been working with investment advisers and fund managers since 2004 to provide them with a presence on the internet. Our design and technology teams have spent years crafting websites and platforms and are constantly updating our user-friendly functionality,” says Aaron Wormus, Managing Director of HedgeCo Websites. “While our functionality was built around our hedge fund clients, we came to the realization that all our built-in features were transferable to investment advisers without hedge funds, including our investor tracking and management, content management system, and compliance tools.”
RIA Websites provides investment advisers with all-in-one technology tools, including websites, document tracking, user and investor tracking and management, and performance and quantitative statistics. With its modular design, investment advisers can easily select the functionality they need without paying for unnecessary features.
“We are very proud of our platform and the service we provide our website clients, and quite frankly, I believe this is a product that no other firm provides,” claims Evan Rapoport, CEO of HedgeCo Networks. “We have spent years developing our websites, including HedgeCo.Net, and client websites. We have done websites for all sizes of firms, from small emerging managers to multi-billion dollar asset managers. Furthermore, we know the ins and outs of compliance from working with the SEC and other regulators and through running our own funds and broker/dealer.”
Please visit RIAWebsites.com to view the whole product offering.
About HedgeCo Networks:
HedgeCo Networks LLC manages HedgeCo.Net, the premier Hedge Fund Database and Information Portal, along with a portfolio of nine other websites devoted to alternative investments. With over 45,000 active members, HedgeCo.Net provides a community and platform for hedge fund managers, investors and service providers. HedgeCo also offers a vast array of hedge fund services, including website design, consultation, third-party marketing and seeding. The Company has consulted or helped to launch over 500 new hedge funds, both onshore and offshore. HedgeCo Networks was founded in 2002 by Evan Rapoport. For more information, please visit http://www.HedgeCo.net
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Press Release – Rothstein Kass, a leading professional services firm to the alternative investment community, has published its sixth annual report on hedge fund industry trends. “Hedge Funds 2.0: Evolution in Action” features the findings of a first quarter 2012 survey of 400 hedge fund managers, representing 771 hedge fund vehicles.
Survey participants were asked to weigh in on a broad range of topics including investment outlook, operational issues and regulatory concerns. Roughly 48 percent of hedge fund managers surveyed indicated that 2012 will be a difficult year for the sector, with nearly 40 percent expressing concern that the United States could enter a “double-dip” recession. Findings suggest that amid ongoing economic uncertainty, hedge fund managers continue to find opportunity, as slightly more than 66 percent of respondents indicated that they plan to raise assets by 25 percent or more this year. Nearly one-third of hedge fund managers do not plan to use leverage in 2012, while over half intend to use less than 2:1 leverage this year.
“In the months following the global economic meltdown, many observers predicted doom for the hedge fund industry, with some anticipating that a more aggressive regulatory agenda and challenging market conditions would lead to significant attrition. At that time, Rothstein Kass stood out as one of the few voices that forecast that the hedge fund community would emerge from the crisis stronger than ever. Our confidence was instilled over decades spent working closely with the sector, and was reinforced by our long-standing view of the industry’s institutionalization,” said Howard Altman, Co-CEO of Rothstein Kass and Principal-in-Charge of the Financial Services Group. “This year, our research shows an industry that continues to benefit from institutional asset flows and efforts to enhance transparency. At the same time, managers are cognizant of the challenges that lie ahead, as legislative efforts move from theoretical to reality.”
Over 70 percent of survey participants report assets under management (AUM) under $500 million, with the remainder reporting AUM in excess of $500 million. Findings suggest that increasing asset flows from pension funds and other institutional investors continue to fuel demand for enhanced transparency. Nearly a third of hedge fund managers polled believe that investor due diligence will take six or more months to complete. Regulatory developments also weigh heavily on managers, as over half indicated concern about the scope and frequency of reporting requirements. Over 40 percent suggested that they are concerned about the staffing and resources that will be required to comply with enhanced reporting requirements. Approximately 30 percent of funds with less than $100 million AUM have registered with the SEC, according to the research.
“Hedge fund managers are often confronted with a growing array of responsibilities that can detract from the overall focus on generating investment returns. For many institutional investors, operational and reporting capabilities are as important as investment performance. With competition for capital intense and due diligence processes expanded, the imperative for all funds – especially emerging managers – to ‘act institutional’ in all respects has never been greater. Fortunately, we’re seeing the emergence of a new generation of hedge fund managers that are well-equipped to tackle this challenge. These professionals have grown up within the hedge fund sector, developing the specialized expertise required to position their firms for success in the future,” said Mr. Altman.
Among other notable survey findings:
Nearly 80 percent of respondents believe seeding is critical to a successful launch this year
UCITS vehicles, despite their popularity in Europe, have yet to infiltrate the U.S. marketplace. Of the 400 hedge fund firms and 770 funds polled, only 17 UCITS products were reported
The percentage of women and minority owned firms remains low, at 5.8 percent and 10.3 percent, respectively. However, firms that have launched in the last three years are three times more likely to report 50 percent or more women and minority ownership
“A major part of the hedge fund industry allure is the diversity that the community has come to represent. The sector’s proliferation means that there are funds and strategies suited to a wide range of specific investment objectives. Until very recently, however, this diversity has not extended to the number of women in senior roles at hedge fund complexes. One of the most encouraging findings of our latest research suggests that women are finding increased opportunity at emerging hedge funds. From our experience, we’re seeing growing interest from entrepreneurial women seeking to launch hedge funds, as well as growing consensus that greater concentrations of women in the industry will bring needed perspective as the sector continues its evolution,” said Kelly Easterling, Principal-in-Charge of Rothstein Kass’ Walnut Creek office.
About Rothstein Kass:
Rothstein Kass is a premier professional services firm that has served privately held and publicly traded companies, as well as high-net-worth individuals and families, for more than 50 years. As trusted advisors to our clients, Rothstein Kass provides accounting, auditing and tax services, as well as a full array of integrated services, to clients across industry spectrums and in all stages of organizational development. At the core of Rothstein Kass’ remarkable success lies our commitment to hiring, developing and retaining a team that possesses an entrepreneurial spirit mirroring that of the sophisticated business and financial services communities that we serve.
Rothstein Kass Business Advisory Services professionals provide value-added and result-oriented consulting services to clients across industries in the areas of strategy, operations, technology, risk, compliance, dispute resolution and investigations. Rothstein Kass Business Advisory Services, LLC is an affiliate of Rothstein, Kass, a premier professional services firm serving clients for more than 50 years.
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New York – Hedge fund giant SkyBridge Capital, the producers of the SkyBridge Alternatives (SALT) Conference, announced that they have established The Aspire Giving Foundation to raise awareness and capital for organizations that provide underserved populations with the tools needed to achieve their aspirations.
The Foundation’s launch will be marked with an evening of philanthropy and entertainment – featuring a performance by Grammy winners Maroon 5 - on Wednesday, May 9, 2012, during SALT 2012 at the Bellagio Resort & Casino in Las Vegas.
Aspire Giving is comprised of partnerships with a select group of non-profit organizations that address the Foundation’s vision. Aspire Giving’s current partners include: charity:water, which brings clean, safe drinking water to people in developing nations; Network for Teaching Entrepreneurship (NFTE), which empowers students to own their educations in and out of the classroom by providing entrepreneurship education programs relevant to the real world; and Warrior Gateway, which connects individuals in the military community with organizations and programs (non-profit, government, educational or employment-related) in their neighborhood that are there to support them. Although all current and future charities partnering with Aspire Giving have their own distinct mission, each reflects the Foundation’s core mission to:
· Promote entrepreneurialism, innovation and economic development;
· Facilitate access to health systems, educational opportunities and lifesaving necessities;
· Empower underserved and historically disadvantaged populations, communities and its citizens as to improve their quality of life; and
· Advance human rights, eliminate disparities and reduce poverty and hunger.
“Philanthropy has always been a fundamental part of SkyBridge’s culture and we have thought long about how best to establish a foundation that would provide underserved communities with the appropriate resources to advance their goals and aspirations,” said Anthony Scaramucci, managing partner and founder of SkyBridge. “We support the great work that is being done by charity:water, NFTE and Warrior Gateway, and are excited for the opportunities that Aspire Giving will provide going forward.”
All registered SALT 2012 delegates will be invited to attend this exclusive event. There are also a wide range of sponsorship and VIP packages, including backstage passes to meet Maroon 5, access to the concert VIP lounge and invites to premiere SALT parties. However, due to overwhelming demand, SALT 2012 registration closed early on April 20, 2012.
New York (HedgeCo.net) – The University of Oxford is establishing a lab as the latest project in the collaborative venture between Oxford and $58.4 billion hedge fund investment manager, Man Group plc.
The Oxford-Man Institute of Quantitative Finance (OMI) virtual ‘data lab’ will be powered by OneTick, a single solution for complex event processing (CEP), analytics and tick data created by OneMarketData, LLC.
“Markets are complex, evolving systems carrying a huge amount of data, Being able to access and manage financial and business data quickly is very important if we are to learn how to address the key problems associated with financial markets and risk in a way that has significant impact.” Professor Terry Lyons FRS, Director of the Oxford-Man Institute, said, “The new system will aid our researchers in gaining a better and deeper understanding of financial markets, their behaviour, their stability, and their inter-dependence.”
The data lab will mirror the systems already used by commercial financial institutions worldwide to capture, store and analyse vast amounts of financial data, educating the next generation with a range of tools they need to create new economic and trading strategies.
Researchers at the Institute carry out work on market volatility, hedge fund liquidity, credit default and systemic risk and are pioneers in computational techniques and new mathematics to optimise portfolios.
Bloomberg – Man Group Plc rose in London trading after analysts at UBS AG said the past year’s share- price decline for the world’s biggest publicly traded hedge-fund manager makes it a takeover target.
The shares rose 4.5 percent to 96.7 pence at 4:02 p.m. local time, giving London-based Man Group a market value of 1.8 billion pounds ($2.8 billion).
