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.
Forbes – French bank Societe Generale (SocGen) plans to reduce its holdings in its China fund joint venture due to regulatory concerns after a global reorganisation, two people familiar with the situation said.
SocGen already owns a fund venture with a unit of Shanghai Baosteel Group, and will become an indirect stakeholder in Credit Agricole’s Chinese venture after the two banks complete a planned merger of their global asset management businesses.
Forbes – A year ago, Conrad Levy was a player in one of the most spectacular blow-ups in hedge fund history. Peloton Partners, the fund at which Levy was chief compliance and operating officer, collapsed after an outsized bet on subprime securities went horribly wrong, resulting in the fund losing $17 billion in a matter of days. Now Levy is profiting from that experience.
Since mid January, Levy has been working as a consultant for PricewaterhouseCoopers, helping hedge funds restructure themselves when they have hit a landmine.
Forbes – Man Group PLC, the world’s largest publicly traded hedge fund, said Thursday that funds under management declined in the first half despite a recent growth in private investor sales.
The group said it had $43.3 billion in funds under management on June 30, down from $44 billion at the end of May and $46.8 billion on March 31.
Private investor sales in the three months ending June 30, the company’s first quarter, were $3.4 billion, producing a net inflow of $1.9 billion. However, institutional sales amounted to just $300 million, with a net outflow of $3.3 billion.
Boston Globe – State Street Corp., which specializes in serving institutional investors and wealthy customers, said Thursday it has been selected to provide hedge fund administration services for about $6 billion in assets advised by Caxton Associates.
State Street’s hedge fund administration company International Fund Services will provide accounting, fund administration, tax and risk services to five master-feeder fund structures managed by New York-based Caxton Associates and affiliates.
"Our decision to select IFS as our independent fund administrator was based on their long and significant experience servicing highly sophisticated and complex hedge funds in the industry," said John G. Forbes, chief operating officer of Caxton Associates.
Forbes – Chinese sovereign wealth fund China Investment Corp is poised to invest around $500 million into a Blackstone Group hedge fund unit, a source familiar with the situation said on Friday.
The Wall Street Journal earlier reported the news and said it was part of a broad effort to put cash to work, and that the hefty injection would be welcome news for hedge funds.
Forbes – There should be regulation for areas which have previously been excluded from supervision such as hedge funds, investment banks and derivatives, European Central Bank Executive Board Member Lorenzo Bini Smaghi said on Friday.
‘There is no problem of over-regulation at the moment but there is a need to regulate areas that are not regulated,’ he said at an event in Milan.
Forbes – Consolidation in the asset management industry is set to intensify as encroaching regulation and client demands for independence force banks to hive off fund arms, Barclays said on Friday.
Major investment banks were finding it ever harder to keep hold of their fund divisions, Barclays President Bob Diamond told a conference call after agreeing to sell Barclays Global Investors to BlackRock for $13.5 billion.
‘The investment management industry is in early days of consolidation… We’ve made a clear decision that this trend is in place for a while and that is around independence,’ he said.
Forbes – A Silicon Valley hedge fund manager accused of bilking investors out of at least $5 million has agreed to be extradited from Hong Kong to the United States, a government lawyer said Friday.
Fund manager Albert Hu, an American citizen, gave his consent to surrender to the U.S. in a Hong Kong court proceeding, said local government counsel Yasmin Mahomed, who represented U.S. authorities.
Forbes – Plummeting stock prices in Eastern European should have made the region full of rich pickings for Western investors, but hedge funds and private equity firms have been sitting on the side lines for the last few months, fearful that things would continue to deteriorate. Now the tide is finally changing, and the some of the first investors dipping their toes back in are from the private-equity sphere.
Italian insurer Assicurazioni Generali has just put 300 million euros ($419.8 million) into a joint private-equity fund to invest in Central and Eastern Europe. It is launching the 615.0 million euro ($874.7 million) fund with PPF Group of the Czech Republic, which has already invested some 400.0 million euros ($568.9 million) into the region, focusing on mid-cap companies, a PPF spokesman said.
Forbes – Aggressive government action can hurt the market, but regulators should clamp down on excessive borrowing by banks and investors to prevent another credit crisis, veteran hedge fund manager Paul Singer said at a conference.
Singer said the current ‘anti-capitalist’ fervor, inspired by last year’s market meltdown and the ongoing recession, will likely lead to increased regulation. These measures would only prolong the problem, he told some 1,200 hedge fund executives at the Ira Sohn Investment Research Conference on Wednesday.
Forbes – Following a brutal 2008 of losses, plunging assets and the Madoff scandal, the activities of the Obama administration were a primary worry among the nearly 500 hedge fund managers and other industry executives gathering at a Las Vegas conference this week.
‘When you have government intervention at the scale we have, you do something the markets abhor: you create uncertainty,’ said Sean Mathis founding partner of New Centurion Capital Partners. ‘We have uncertainty where markets are going and what the rules of the road will be.’
The Obama administration, even as it courts private investors to help buy up toxic bank assets, has targeted Wall Street bonuses and called for tougher market regulation.
Forbes – Gottex Fund Management Holdings Ltd has bought a controlling interest in SJC Capital Partners, a U.S.-based investment management firm.
The fund of hedge funds provider said SJC founder and Chief Investment Officer Stephen Czech and his team would join Gottex’s New York operations with immediate effect.
