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.
The Hindu Business Line – Hedge funds investing in India are now among the top performers globally, after languishing at the bottom of the charts, hit by poor returns and outflows in 2008. Inflows into India specific hedge funds, however, continue to be muted.
The 37-per-cent gain in Eurekahedge India index, disseminated by Eurekahedge (a leading data provider on alternative investments), makes it the top gainer among regional hedge fund indices until July 2009.
Eastern Europe and Russian region and Greater China vie for the second position with 33 per cent return. Hedge fund returns in developed markets such as Europe and North America are relatively muted between 12 and 14 per cent, dragging the global returns down to 12 per cent.
Cayman Compass – The average hedge fund recorded gains of 2.42 per cent in July data released by hedge fund data provider Hedge Fund Research shows. Hedge fund assets have increased on average by more than 12 per cent in the first seven months of this year. In July the increase was driven by higher equity market returns, Hedge Fund Research said.
July was the fifth month of consecutive gains for the industry, which lost a record 19 per cent overall in 2008. While the hedge fund industry currently experiences its best year since 1998, most fund manager have not yet recovered from last year’s losses and record redemptions in the final quarter of 2008.
Cayman Compass – The average hedge fund recorded gains of 2.42 per cent in July data released by hedge fund data provider Hedge Fund Research shows. Hedge fund assets have increased on average by more than 12 per cent in the first seven months of this year. In July the increase was driven by higher equity market returns, Hedge Fund Research said.
July was the fifth month of consecutive gains for the industry, which lost a record 19 per cent overall in 2008. While the hedge fund industry currently experiences its best year since 1998, most fund manager have not yet recovered from last year’s losses and record redemptions in the final quarter of 2008.
CNBC – The Commodities Futures Trading Commission will seriously consider imposing strict position limits on traders placing bets on energy contracts, and that’s just fine with hedge fund manager Mike Masters.
The head of Masters Capital Management blew the whistle on oil speculators last year when he testified before Congress regarding the rapid run-up in oil prices as it reached its record high of $145 a barrel. He is scheduled to testify at the CFTC hearings Aug. 5.
Masters, whose long/short equity fund manages approximately $1.06 billion according to data provider IPREO, believes stringent limits on commodities trading would work.
NASDAQ – The pace of new European hedge fund launches has stalled this year after the industry’s dismal 2008 performance made investors unwilling to back new ventures.
Data provider EuroHedge Monday said just 47 funds started trading in the first six months of the year, the least in a decade and less than half the number in the same period of 2008. The new funds collectively raised $2.09 billion – a figure that in "normal" times might have been raised by one fund alone.
However, EuroHedge said there are signs the second half could be more fruitful, with several high-profile funds already started or in the pipeline. Those include Theleme, a global equities strategy being set up by Patrick Degorce, a co-founder of The Children’s Investment Fund who left to strike out on his own, and Gyldmark Liquid Macro Fund, a fund started by former BlueCrest Capital portfolio managers.
The Australian – Global hedge funds made an estimated 9.73 per cent in returns for the year to June 24, according to figures published by data provider Hedge Fund Research.
Individual managers, including Britain’s Henderson Global Investors, have seen funds rise by more than 60 per cent this year. In the wake of these results, the £1.8 billion ($3.68bn) Avon Pension Fund has been advised to stick with its 10 per cent allocation to hedge funds after putting them under review, while the Clwyd Pension Fund said it would keep 5 per cent in funds of hedge funds and is looking for a single-manager hedge fund.
Bloomberg – Asian hedge funds are attracting growing interest from investors as managers focusing on the region outperform global peers, said Andrew Hill, director of prime finance for Asia-Pacific markets at Citigroup Inc.
“There are pockets of proprietary money looking to be put to work in Asia,” Singapore-based Hill said in a June 12 interview. “There is going to be an outsized investment back into Asia. Some of the big pensions are going to be looking at Asia; it’s coming onto the radar screens.”
Asia-focused hedge funds gained 12.4 percent in the first five months of the year, outpacing returns in the U.S. and Europe, according to Eurekahedge Pte. That’s a reversal from last year, when clients withdrew almost $24 billion from the region’s hedge funds as managers posted bigger losses than global peers, the Singapore-based industry data provider reported.
Bloomberg – More than 80 percent of Asian hedge funds won’t be able to charge their investors performance fees after finishing 2008 below their peak net asset values, according to data provider Eurekahedge Pte.
About a third of the 1,000 regional hedge funds tracked by Eurekahedge had positive returns last year, compared with 82 percent in 2007, the data provider said, citing figures from Jan. 30 when about 90 percent of funds had disclosed December returns.
Bloomberg – Kanetsu Asset Management Co. will liquidate hedge funds, including Japan’s best performer last year, as commodities trading shrinks, a company executive said.
The Tokyo-based firm will shut DragonHorse, which according to data provider Eurekahedge Pte returned 27 percent in 2008, the highest among Japan-based hedge funds. Kanetsu Asset will also close two other hedge funds before the firm shuts at the end of March, because computer-driven trading of commodities has become less viable as volumes have declined, President Takashi Ogura said in a telephone interview today.
As many as 920 funds globally may have closed last year, eclipsing the previous record of 848, according to Chicago-based Hedge Fund Research Inc. Japan’s dwindling commodities market and regulatory hurdles to combining commodities trading with financial securities hindered Kanetsu Asset, which had 800 million yen ($8.9 million) in assets.
Bloomberg – Artradis Fund Management Pte., whose volatility funds posted the best returns among Asian hedge funds last year, is betting continued market swings will help them outperform again in 2009.
While volatility will decline to “more normal levels” from the records set in 2008, the funds will continue “to be able to take advantage of significant moves in markets,” said Julian Ings-Chambers, a managing director at Artradis, Singapore’s biggest hedge-fund firm.
The $2.4 billion Artradis AB2 Fund, managed by Stephen Diggle and Richard Magides, rose 35 percent last year, according to the firm. The $1.8 billion Artradis Barracuda Fund, which uses less borrowed money than the AB2, added 27 percent. The funds, which place wagers on price swings, had the highest returns among Asia-focused hedge funds that manage at least $500 million, according to Eurekahedge Pte., a Singapore-based data provider.
Business Times Malaysia – Hedge funds posted their biggest decline on record last year, losing US$350 billion globally, as the credit crisis crippled returns and forced investors to pull money out, an industry report showed.
About 90 per cent of the money was lost in the three months to the end of November, according to a preliminary report published on Monday by Singapore-based data provider Eurekahedge.
Funds that invested in North America declined the most, posting a drop of US$183 billion for the year, the report said.
The hedge-fund industry shrank by about a fifth to US$1.5 trillion at the end of the year from a peak of US$1.9 trillion, Eurekahedge said.
People – Bowing to Europe’s enthusiasm fora new global financial order, U.S. President George W. Bush has agreed recently to host a world summit on reforms of the international financial system.
After a weekend meeting at Camp David some 100 km north of Washington D.C., Bush said in a joint statement with French President Nicolas Sarkozy and European Commission President Jose Manuel Barroso that the summit would "seek agreement on principles of reform needed to avoid a repetition of the problems and assure global prosperity in the future."
It was regarded as a victory for European Union (EU) leaders, who are pushing hard for an overhaul of the current global financial system in the wake of the financial crisis.
Europe has become a big victim in the financial crisis, which originated in the United States. As European banks are still struggling with tight credit triggered by the U.S. sub-prime mortgage defaults, Europe learned it can hardly be separated from the United States.
