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.
New York Post – Todd Stottlemyre, the former major league pitcher and the son of Yankees standout Mel Stottlemyre, is hoping to hit a home run moving from the diamond to the hedge-fund world.
The 44-year old former member of the Toronto Blue Jays, Oakland Athletics, St. Louis Cardinals, Texas Rangers and Arizona Diamonbacks, just started Desert Shores Capital, which, according to one published report, could be a hedge fund built around fast-paced momentum trading in stocks.
Reuters – Hedge funds around the world extended their losses last month when the average portfolio declined 1.41 percent amid fresh stock market turmoil, data released on Friday shows.
The average hedge fund lost 17.70 percent in the first 11 months of 2008, figures from Hedge Fund Research show.
These numbers mark the worst-ever returns in an industry that once wooed investors with promises of strong returns in all market conditions and whose only unprofitable year was 2002, when the HFRI index lost 1.45 percent and the S&P 500 dropped 23 percent.
TheStreet.com – "Desperate times call for temperate measures" might be a (corrupted) saying that describes a prudent approach to the maelstrom of the stock market.
Mass redemptions resulting from turmoil in the hedge fund industry are a major factor in the market’s outsized swings in recent weeks. So it might seem ironic that three of the highest-rated mutual funds, as measured by TheStreet.com Ratings, are essentially hedge funds for Everyman.
USA Today – Technically, a bear market is when stocks fall 20% or more from their highs. But there’s a saying that a bear’s true signature is making a fool out of everyone. Based on that, we’re all laughingstocks, because there has been virtually no way to avoid this bear market’s claws.
Following a 445-point slide to 7552 Thursday, the Dow Jones industrial average is down more than 6,600 points from its high. The broad stock market is at it lowest level in 11½ years, with the Standard & Poor’s 500 index off 52% from its high in October 2007 and on pace for its worst year ever, S&P says. Only 13 of its 500 stocks are not down for the year, and more than 100 trade for less than $10 a share.
Wall Street Journal – Down in the morning, up in the afternoon. Or is it the other way around? The topsy-turvy stock market is tough to read.
In the last year, the Dow Jones Industrial Average has briefly been over 13,000 and below 8,000. The past month has felt like the Cyclone roller coaster on Brooklyn’s Coney Island — lots of ups and downs, the whole rickety thing feeling like it’s going to crash at any minute.
Thanhnien – The PXP Vietnam Value Fund will raise as much as $200 million to invest in undervalued stocks, Snowball said.
PXP, the initials of Phan Xi Pang, Vietnam’s highest mountain, is betting that the stock market will recover as inflation eases and the nation’s trade deficit widens at a slower pace. The benchmark VNIndex may double to 750 points by the end of 2009, Snowball said.
“In the long term, the story’s intact,” Snowball, 47, said in an interview in Ho Chi Minh City. “As long as the government handles the development of the economy and the market correctly – so far they’re doing a very good job – then I think we’re fine.
Forbes – Hedge funds are to the modern stock market as sun spots were to electronics in the 1960s: a convenient scapegoat when things go wrong without an evident cause. But they probably aren’t to blame for last week’s poor showing on Wall Street, and rumors of the industry’s demise are likely premature.
There has been speculation that funds are currently under pressure to sell stocks because Saturday was 45 days from the end of the year. Traditionally, some hedge funds have given their shareholders a month and a half to make their intentions of annual sales known.
Bloomberg – PXP Vietnam Asset Management, which oversees $225 million, plans to start a hedge fund by early next year as it seeks bargains in Asia’s second-worst-performing stock market, said co-founder Kevin Snowball.
The PXP Vietnam Value Fund will raise as much as $200 million to invest in undervalued stocks, Snowball said today.
PXP, the initials of Phan Xi Pang, Vietnam’s highest mountain, is betting that the stock market will recover as inflation eases and the nation’s trade deficit widens at a slower pace. The benchmark VN Index may double to 750 by the end of 2009, Snowball said.
“In the long term, the story’s intact,” Snowball, 47, said in an interview in Ho Chi Minh City. “As long as the government handles the development of the economy and the market correctly – - so far they’re doing a very good job — then I think we’re fine.”
North County Times – The stock market is retreating, credit markets are squeezed and many corporate earnings are diving. But one piece of the mangled U.S. economy is making an improbable comeback: the dollar.
As the financial meltdown clobbers world economies from South America to Asia, investors desperate for safe assets are plowing money into the battered buck —- helping it snap a six-year slide and reclaim its long-held status as a stable asset during rough times.
"The dollar has become the safe-haven play," said Kathy Lien, director of currency research at Global Forex Trading in New York. "It’s a pretty monumental move we’re seeing" and" reflects a "crisis of confidence."
While the U.S. economy by no means is showing signs of a recovery, Lien said other countries are "just beginning to feel the magnitude of the global slowdown, whereas the U.S. is maybe three-quarters of the way through. "What everyone is beginning to realize is that, yes, the U.S. is in trouble. But it’s also much further along (in the crisis) and probably closer to stabilizing than Europe and other regions," Lien said.
Hamilton Spectator – North American stock markets chalked up huge rallies late in the afternoon yesterday, resulting in one of the biggest one-day gains ever for the Dow Jones industrial average and a big bounce in Toronto.
Toronto’s S&P/TSX composite index rose 614.29 points or 7.2 per cent to close at 9,151.63. That mended a good chunk of the 757-point hole dug on Monday, when growing worries about the length and depth of a global recession pushed down Canada’s main index by eight per cent.
In New York, the Dow gained 889.35 points yesterday to rise almost 11 per cent to 9,065.12 — the second-biggest percentage gain on record for the world’s most-watched stock-market indicator
WBT – U.S. stocks appeared headed for a rebound Tuesday as investors awaited the start of a two-day meeting of the Federal Reserve that is widely expected to bring another reduction in interest rates.
The sharp rise in stock market futures contracts Tuesday was to be expected given the extreme volatility that has been the hallmark of Wall Street’s behavior for more than a month. At the same time, the sometimes light volume of futures trading can make it difficult to determine the market’s overall mood. In recent weeks, stock futures have moved solidly in one direction, while actual trading was more moderate after the opening bell.
A higher open would come as casualties from the global crisis piled up Tuesday: Whirlpool Corp. said it will cut about 5,000 jobs by the end of 2009, Iceland said it needs $6 billion and Germany said Pakistan must secure a loan from the International Monetary Fund within a week.
Arlington Heights Daily Herald – In a typical recession, stocks start recovering about six months before the economy does. The crisis the United States is in right now, however, is anything but typical: Lending is frozen, hedge-fund selling is happening on a massive scale, and economic troubles have spread all over the globe.
As a result, it’s possible the U.S. economy will need to show signs of strength before the stock market stabilizes and regains steam. So with readings getting darker by the day, expect more of the same this week: extreme volatility.
"Volatility’s here, and it’s here to stay," said Ryan Detrick, senior technical strategist at Schaeffer’s Investment Research. Last Friday, the Dow Jones industrial average finished down 312 points, "and it seemed like a victory."
