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.
Wealth Bulletin – AQR Capital Management intends to launch a line-up of mutual funds next month that will use a hedge-fund strategy developed in 1989 by founder Clifford Asness as a doctoral student in finance at the University of Chicago, according to a report in The Wall Street Journal.
Reuters – Prominent hedge fund manager Clifford Asness has struck back at the Obama administration, saying hedge funds had the right and responsibility to hold out on last week’s Chrysler LLC restructuring deal.
"Managers have a fiduciary obligation to look after their clients’ money as best they can, not to support the President, nor to oppose him, nor otherwise advance their political views," Asness, who oversees about $20 billion at AQR Capital Management, LLC wrote in an undated letter.
Bloomberg – Tozai Investment Advisory Ltd., a Tokyo-based hedge fund adviser, is closing its business after market losses and investor redemptions cut its funds’ assets to zero from a peak of $70 million, a senior partner said.
The Cayman Island-based Trident Pacific Japan Absolute Return Fund, which Tozai advises, was closed last month, Angus McKinnon, senior partner at Tozai said in an interview in Tokyo yesterday. The fund, launched in December 2004, invested in Japanese equities using a so-called long-short strategy that bets on rising and falling stock prices, McKinnon said.
Global hedge funds are bracing for the worst year on record as more than 80 firms liquidated hedge funds, segregated assets or limited withdrawals following the MSCI World Index’s 44 percent drop this year and tightening credit conditions. Citadel Investment Group LLC, the hedge-fund manager founded by Kenneth Griffin, said yesterday it will close its Tokyo office, eliminating 12 jobs.
West Palm Beach (HedgeCo.net) – Hedge Fund manager Gartmore Investment Management Limited is launching the Gartmore European Absolute Return Fund, to be co-managed by Roger Guy and Guillaume Rambourg, subject to regulatory approval.
The new fund will be a UCITS III limited issue vehicle with capacity set at £200 million, the fund’s three week offer period starts on 6th October before its launch on 31st October 2008.
The Gartmore European Absolute Return Fund, the first in a series of absolute return offerings planned by Gartmore, will seek to deliver positive absolute returns over the long-term in all market conditions by taking long and short positions in equities and derivatives. It will be managed using a similar strategy to Gartmore’s flagship European equity long/short hedge fund – the Gartmore AlphaGen Capella Fund.
Commenting on the proposed launch, Richard Pursglove, Head of UK Retail at Gartmore, said: "Over the last decade we have transformed our business into a specialist provider of long-only and alternative products. This latest development is an important strategic addition to our retail fund range, and has been driven by substantial client interest from discretionary asset managers, wealth managers and IFAs seeking uncorrelated, positive returns."
He concluded: "Gartmore’s substantial experience in shorting, combined with it long established hedge fund infrastructure, will be attractive to investors looking for absolute returns."
Gartmore is a leading provider of long-only and alternative investment solutions and one of the pioneers of managing hedge funds on behalf of institutional investors. Since entering the hedge fund arena in 1999, Gartmore has built an $11billon** hedge fund business and is one of the largest hedge fund providers in Europe.
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West Palm Beach (HedgeCo.Net)- Florida based hedge fund manager INTL Consilium LLC and First City Monument Bank Plc have jointly launched the Legacy Africa Alpha Fund, a $100 million hedge fund investing in Africa and the Middle East.
"The new Legacy Africa Alpha Fund is a natural extension to our global products as we have been investing aggressively in the region for three years now." Jonathan Binder, co-portfolio manager, said.
Structured as an absolute return fund, the strategy focuses on capital appreciation and income via investments in debt and equity securities in sovereign or corporate entities located in Africa and the Middle East. The goal of the strategy is to produce consistent absolute returns while maintaining attractive risk-adjusted return profiles, irrespective of the conditions of the global markets.
The Legacy Africa Alpha Fund will place a 30% cap on its Middle Eastern weighting to ensure significant exposure to Africa’s fastest growing economies,
"INTL already has over $450 million invested in the region in both debt and equity securities in over 16 different countries as they were quick to identify value and growth opportunities at a time when many investors shied away." co-portfolio manager Charles Cassel added, "The Legacy Africa Alpha Fund is an exciting venture for our team, as it will allow us to leverage our existing knowledge and contacts within the region."
In addition to the Legacy Africa Alpha Fund, CSL is simultaneously launching two additional funds under the flagship “Legacy” brand. The Legacy 50 Fund, an index tracker of Nigeria’s top 50 companies by market capitalization and the Legacy Banking 10, driven semi active fund investing in Nigerian Banking shares will each be launched with N3 billion under management. This will bring total assets under management to N24 billion ($ 205 million), making it arguably the largest asset manager in Nigeria.
New York (HedgeCo.Net) – Drake Management will shut down its two remaining hedge funds one month after winding down the $2.5 billion Global Opportunities Fund. The $1.4 billion Absolute Return Fund and the $160 million Low Volatility Fund will follow suit, after experiencing similar losses originally fueled by the subprime fallout and credit crunch.
Drake had informed investors in March that they were considering shutting down the funds, citing “challenging market conditions.”
The Absolute Return Fund was down 14.36 percent in 2007, while the Low Volatility Fund was down 4 percent. Drake will be launching new funds, and investors that choose to stay with the firm will only pay performance fees once the original losses are recouped.
"We are committed to launching successor vehicles for the funds later this year, for those investors who have expressed a desire to remain invested in strategies substantially similar to those of the funds and to new investors who would like to invest," said the company.
Drake was formed in 2001 by former BlackRock manager Anthony Faillace and his partner Steve Luttrell.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
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