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.
West Palm Beach (HedgeCo.net) – Brotman Capital Partners LP, based in Boca Raton, Florida, has turned in the best performance Year to Date of a Market/Trend Timing Hedge Fund according to Barclays Hedge Fund Database.
Through October, 2008 the Fund is up over 14% net of fees. The fund has a $100,000 minimum investment and charges a 2% management fee and a 20% incentive fee.
According to Dr. Randy Brotman, Chairman and CEO, the fund has remained in cash since the middle of August. He states that “in our Trend Timing Fund, cash is an option, therefore a position.”
The Proprietary Trend Timing Model that Brotman Capital Management LLC employs dictates when the Fund should be long, short or in cash. “Be are comfortable to sit on the sidelines and wait for the trend-timing model to tell us when we will reenter the market, Brottman concluded.
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds!
AllAboutAlpha.com – Several pundits have recently pronounced the so-called “hedge fund model” to be dead (or at least “upended“). But is the patient clinically dead, or is it just having an out-of-body experience? After the recent trauma experienced by the sector, hedge fund administrators will likely play a central role in bringing the industry back from the other side.
Hans Hufschmid, the CEO of GlobeOp, one of the world’s biggest hedge fund administrators, recently told the FT that:
“There will be tremendous trading opportunities. We are seeing opportunities that we haven’t seen in our lifetime, just in terms of relative trading let alone directional…
“Convertible bonds are extremely cheap, there are mortgages that are extremely cheap and distressed assets that are extremely cheap. There are lots of opportunities that are ideal for hedge funds to take advantage of.
“Further, hedge funds will face less competition with investment bank proprietary trading desks largely disappearing from the market.”
Reuters – Blue Mountain Capital Management LLC has temporarily halted redemptions at its largest hedge fund after clients asked to withdraw money despite its "distinguished" performance, according to a letter to its investors.
New York and London-based Blue Mountain said in the letter it had come up with a "redemption and recapitalization plan" to protect all its investors in the $3.1 billion Blue Mountain Credit Alternatives Fund.
The fund is down 2.4 percent year-to-date, the letter said, far less than the average fund which has lost 20 percent this year. Blue Mountain has a total of $5.5 billion assets under management.
The pressure on the credit fund came from some large fund-of-fund investors, "themselves facing liquidity pressures from their own investors," submitting significant redemption notices, the letter said.
"If we were to unwind or sell positions to meet current redemptions, the severe liquidation costs would be borne inequitably by the remaining investors," wrote CEO Andrew Feldstein in the letter, seen by Reuters.
New York (HedgeCo.Net) – One month after RAB was forced to revamp their flagship fund, the British hedge fund is halting redemptions on their Energy Fund. After losing more than 50% of its value this year, RAB has informed investors that they will not be able to make withdraws in the near future.
Investors who wish to stay in the fund will be offered the same deal as those locked up in the $1.4 billion Special Situations Fund. The deal entails paying smaller management fees in exchange for keeping their money in the fund for the next three years.
Investors have until this Friday to let RAB know whether or not they want to accept the offer. The alternative would be receiving “redemption shares,” which are basically an IOU promised by RAB to pay back the investors when they start posting profits.
The Special Situations Fund, one of the largest shareholders of Northern Rock, got burned with the British Government nationalized the faltering bank. Losing almost $55 million in the first half of the year, former RAB head Phillip Richards wrote it off as “very regrettable” while outlining some new strategies for the company that involved investing in under-developed regions throughout India and the Middle East. Richards stepped down shortly after as CEO to concentrate exclusively on the Special Situations Fund.
The RAB Energy Fund is run by Gavin Wilson and Mark Redway and once managed over $1.5 billion at its peak.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
Metro Canada – A company that will play a key role in the Vancouver 2010 Olympic Games ended rampant speculation about its financial well-being Thursday by completing a deal to refinance a $1.7-billion loan – just hours before deadline.
Intrawest ULC owns and operates major tourism venues across the country but is best known for its Whistler-Blackcomb ski resort, one of the main venues for the Winter Games.
The destination-resort company received unanimous support from its existing lender group Thursday to refinance.
Intrawest CEO Bill Jensen said he’s pleased to have reached an agreement with Fortress Investment Group LLC (NYSE:FIG), "particularly given the challenges of the global credit markets."
"The support Fortress and our lenders have shown underscores their confidence in Intrawest and will enable us to continue to execute our long-term strategic plans," Jensen said in a statement.
Bizjournals.com – A Minneapolis hedge fund has sued Petters Group Worldwide, alleging it was defrauded out of $60 million in a deal involving “imaginary televisions.”
Interlachen Harriet Investments, a Cayman Islands-based unit of Minneapolis-based Interlachen Capital Group, filed the suit Wednesday, saying that it gave $60 million to Petters Co. Inc. to purchase electronic merchandise such as televisions. PCI, a unit of Petters Group Worldwide, was to resell the televisions at a profit. Interlachen alleges that PCI never purchased any merchandise, and used the investment to fund former CEO Tom Petters’ other business ventures, pay down debt and for personal use.
The suit is similar to federal allegations made last week that Petters and several associates bought and sold nonexistent goods with investors’ money for more than a decade by creating the image of a successful retail business.
Reuters – The British arm of asset management group Aviva Investors is betting that investor interest in hedge fund-style products will survive the credit crisis and rebound once market turmoil abates.
Paul Abberley, UK CEO, told Reuters Aviva Investors would boost its high alpha and absolute return business in the coming months and expand its investment team across the board.
Hedge funds and similar products have come under scrutiny as investors question how modest performance in a market turmoil chimes with the high fees charged by the industry. Hedge funds claim to be able to generate returns in bad times and good.
Abberley, CEO of Aviva’s London office since the beginning of August, said: "We believe clients will look for more higher alpha (excess returns) products than in the past and we need to be able to offer excellence in those areas."
Here Is The City – Bloomberg reports that CEOs at Wall Street’s top five securities house earned a staggering $3bn between them from 2003 and 2007, during the time when the subprime and toxic securities timebomb was ticking away in the background. Goldman Sachs CEOs were paid the most in this period ($859m), followed by Bear Stearns ($609m).
And talking of Wall Street finest, former Merrill Lynch CEO Stan O’Neal (who bagged $172m in pay between 2003 – 2007), is said to be thinking of making a comeback. According to The Financial Times, O’Neal is considering joining Vision Capital Advisors, a small hedge fund and private equity firm.
Bloomberg also reports that JPMorgan Chase has acquired Washington Mutual’s branch network for $1.9bn, as the thrift was seized in what has been described as the largest bank failure in US history. JPMorgan will not acquire any of WaMu’s liabilities. CEO Jamie Dimon said: ‘This is a fabulous franchise. We think we got this at a price that protects us’.
Financial Post – The Canadian hedge fund industry has ballooned in the past few years, with some estimating annual growth at 30%. But there is still plenty of room for more, given that plenty of the strategies, such as risk arbitrage, that have proliferated in London and New York have not yet arrived here.
A near full house at yesterday’s Canadian Hedge Fund Managers Speak With Investors forum demonstrated that the industry, now pegged at about 200 separate funds in Canada, is alive and well regardless of the recent turmoil. Much of this is being driven by institutional investment.
Despite so much volatility in the markets in the past two months, and the fact that some feel fundamentals have "gone out the window," Canadian hedge fund managers at the forum, owing perhaps to having less leverage than their U. S. counterparts, remain upbeat. "The response from investors was outstanding. They are looking for some understanding and this is a perfect venue for that," said Karen Azlen, CEO of Introduction Capital, who organized the event.
CNBC – Remember Superman the movie, where Lex Luther takes away the super hero’s powers with a Kryptonite necklace? Well we’re here again. Only this time it is the financial equivalent of the man of steel – the hedge fund manager that has met their own version of the power-draining substance.
Barely a day passes it seems without one of these masters of the universe crashing to earth with swinging losses in their fund, or non-survivable business issues.
RAB Capital star, Philip Richards, has stepped down from his role as CEO of the business in the wake of a profit warning and a plunging share price. Mr Richards has already taken some flak taking a large position in ailing UK bank Northern Rock before it was nationalized. Now he goes back to focusing on the group’s special situations fund. So at least he keeps the day job, but this is an embarrassing development for the company.
Reuters – Hedge fund manager PMA has the capacity to manage as much as $4 billion without curtailing returns given current market opportunities in Asia, its chief executive said in an interview.
The Hong Kong-based firm, which now manages about $2.5 billion, has also seen significant inflows into its funds this year despite the downturn in Asian financial markets, PMA CEO Farhat Malik said.
"The way that the platform is structured at the moment, in terms of capacity, in terms of investment opportunities that we see in the marketplace, we can easily go from $2.5 billion to $4 billion, we feel without sacrificing performance," he told Reuters in an interview late on Tuesday.
"We’ve had significant inflows from institutional investors outside of Asia," he added.
August 2008 – Reuven Enterprises is proud to announce the launch of our CEO’s BLOG. The goal of this blog is to let investors worldwide have Mr. Ron Reuven’s first hand insight on the issues that face the financial markets today without the glamour and exaggeration that they may typically see from other available sources of information. "I only know one version of the truth, only talk about things that I understand, and don’t hold back or sugarcoat." -Ron Reuven. This blog is sure to keep you asking for more of the unique insight that has helped us build and distinguish our firm.
As our society moves toward globalization, it is essential to make the most of what technology has to offer. This will also allow us to create a forum for our elite clientele when addressing critical issues that impact our financial markets and provide a unique and streamlined delivery of information. We continue to exceed our prior efforts in providing our clients with the very best services available. We are confident that the additional tools that we have added to our enhanced corporate web-site will continue to add value for our clients, even if they are located thousands of miles away. To check out our new CEO’S BLOG, please visit our website at www.ReuvenEnterprises.com and click on the MEDIA section on the bottom right of the page.
If you would like more information about this topic please call us at 212-480-9175 or email us at CRM@ReuvenEnterprises.com
