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) – On the 18 of March, the Australian Hedge Fund & Research team at Bronte Capital began dropping hints regarding an un-named $60 million dollar Ponzi Scheme. In a blog entry named "Curiouser and Curiouser" Bronte Capital described the fraud and to support support their claims, posted 2 pieces of Ponta Negra marketing material on the ScribD document sharing site.
The following day, Lawyers representing Ponta Negra contacted John Hempton of Bronte Capital and threatened them with legal action if they did not immediately take down the blog entry. Under the threat of legal action Bronte Capital removed the post.
Unbeknownst to Bronte Capital, the SEC was also investigating the Ponta Negra funds and on the 27th of April the SEC annouced that they were freezing the assets of the 2 Hedge Funds stating that, according to the complaint "on at least two occasions, Francesco Rusciano, 27, of Ponta Negra Group LLC forged brokerage account statements to make it appear that a hedge fund account had millions more dollars in assets than it had."
The SEC announcement restarted the discussion a the Bronte Capital blog and as of the 1st of May, four detailed blog entries have been posted.
The blog entries detail the connections and often blurry lines between Paradigm, owned by the Biden family and the Ponta Negra funds. The common link at the heart of the controversy is Jeffry Schneider and his team at Onyx Captial who worked as hedge fund marketers for both funds. Jeffry Schneider was linked earlier in the year to Stanford Capital Management who is under investigation by the SEC alegedly for running a ponzi scheme. Jeffry Schneider, Onyx Capital and Ponta Negra subleased office space (and infrastructure) from Paradigm.
For a detailed summary read FT Alphaville’s story titled "Untangling floor 17, 650 5th Avenue". Ongoing details of the case are posted at Bronte Capital’s blog.
As detailed on the Bronte Capital blog, Jeffry Schneider had a brief relationship with HedgeCo Networks which ended in a material breach of contract by Jeffry Schneider and ongoing legal action by HedgeCo Networks against Jeffry Schneider and Onyx Capital. Ponta Negra submitted its fund to the HedgeCo.Net database, but was denied due to concerns by the HedgeCo.Net review board.
Aaron Wormus
News Contributor to HedgeCo.Net Email: aaron@hedgeco.net
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!
Seeking Alpha – This morning I pulled out a third quarter report for a hedge fund of funds and read it. It had some numbers in it that weren’t particularly good, but were way better than I thought they’d be.
But I really wasn’t focused on the numbers this morning. I wanted to understand what had happened and what is going to happen in the hedge fund market going forward. And this letter was revealing on both fronts.
From what I could tell by reading the letter, it was nearly impossible to make money managing a hedge fund in the third quarter. I am sure that there are some hedge fund managers who made money in the third quarter but most of the biggest and most experienced hedge funds lost money in the third quarter.
And I suppose the same is going to be true for October, when the numbers come in. If anything, October has been worse in many ways than September was. And yet, the vast majority of hedge fund managers are optimistic. It probably goes without saying that you have to be optimistic about your ability to make money to be a hedge fund manager. But this quote sums up a lot of managers’ thoughts that were expressed in the letter:
Telegraph.co.uk – In the biggest-ever round of redemptions, funds around the world are braced to give back between 10pc and 50pc of their assets under management.
Hedge funds were faced with a slew of redemption notices at the start of the quarter, but investors were prepared not to withdraw their money if returns improved, according to one prime broker. He said many would now be forced to close.
None of the strategies used by hedge funds produced a positive return in September. According to the Dow Jones Hedge Fund Indexes , equity market-neutral funds, which often try to manage risk by shorting a stock in one sector and going long on one if its competitors, have fallen 1.85pc this month, while convertible arbitrage securities have dropped 7.96pc and distressed securities by 7.34pc. That compares with a 9pc decline by the FTSE 100. Hedge fund of funds, which are designed to spread risk, are expected to face the biggest redemptions.
Reuters – Hedge fund manager CQS said on Thursday it had launched a new fund that will aim to profit from the volatility that has gripped global stock markets for much of the past year.
CQS, which had $9.6 billion (5.4 billion pounds) of assets under management at the start of August, said it had launched CQS Global Volatility Fund with an initial size of US$160 million.
The fund will use futures and options to trade volatility, with a primary focus on equity market indexes and on individual equities within the world’s major stock markets.
"The Fund aims to profit from valuation anomalies in equity volatility and from dislocations in markets. CQS believes that equity market volatility provides a consistent opportunity set to capture profits for investors," CQS said in a statement.
West Palm Beach (HedgeCo.net) – TriAlpha recently a launched property hedge fund of hedge funds, the TriAlpha Global Property Strategy Fund in June this year.
The fund seeks absolute returns by focusing on hedge fund managers that specialise in the global property sector. In its first month the fund outperformed the FTSE EPRA Global Index by an estimated 11%. Included in the portfolio are recognised names such as Credit Suisse, Thames River and New Star Property hedge funds. Minimum investment for the TriAlpha Global Property Strategy Fund is $5 million (or equivalent).
“We are already seeing a high level of interest in the TriAlpha Global Property Strategy Fund and by having the fund available through Transact we are broadening the availability of this exciting new offering,” commented Cobus Kruger, director at TriAlpha.
Trialpha’s five sub funds of the ‘TriAlpha Alternative Strategy Unit Trust’ have been also approved as restricted recognised schemes for distribution in Singapore.
"With our roots in Stonehage (our private wealth management parent company,) we have extensive experience in dealing with and providing investment solutions to private clients." Cobus Kruger, Director at TriAlpha, says, "Our hedge fund of funds products have been received well by these clients, fitting in neatly with their investment objectives and risk profiles. With increasing numbers of private banks in Singapore we believe that our hedge fund of funds products will be an appropriate solution for their clients."
The five absolute return funds offer investors a variety of risk profiles and investment strategies, the ‘TriAlpha Relative Value Fund’, which invests in market-neutral, multi-strategy event driven, multi-strategy arbitrage and option arbitrage; aims to achieve stable, absolute returns with volatility similar to the Citigroup World Government Bond Index.
The ‘TriAlpha Multi Strategy Fund’ invests across Asia, European and U.S. hedge strategies, emerging markets, macro, event driven and arbitrage; aims to offer stable, absolute returns with volatility similar to the Citigroup World Government Bond Index.
The ‘TriAlpha Growth Strategy Fund’, which invests in Asia, European and US hedge strategies as well as emerging markets and macro hedge funds with a smaller exposure to arbitrage strategies than the Multi Strategy fund; looks to achieve absolute returns with lower volatility than the MSCI World Equity Index.
The ‘TriAlpha Hedge Equity Fund’ which invests in Asia, European and US hedge strategies; offers investors absolute returns with lower volatility than the MSCI World Equity Index.
And finaly, the ‘TriAlpha Global Property Strategy Fund’ will focus on hedge fund managers that specialise in the global property sector.
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West Palm Beach (HedgeCo.net)- Dynamic Funds ("Dynamic") has announced the launch of two global growth funds, the Dynamic Power Global Navigator Class and Dynamic Power Global Balanced Class.
The fund manager also launched a hedge fund of funds, the Dynamic Alternative Opportunities Fund, giving retail investors access to a basket of the Company’s hedge fund products. Dynamic Alternative Opportunities Fund has the ability to invest in Dynamic hedge funds and closed-end funds, as well as externally managed hedge funds, private funds and other investment vehicles not generally available to the investing public.
"Dynamic Power Global Navigator Class is a go anywhere, do anything global growth fund," says Alexander Lane, VP and Portfolio Manager, "It offers investors exposure to global stocks with the safety profile of larger companies and the higher return profile of smaller companies."
The initial portfolio of the Dynamic Alternative Opportunities Fund will be composed of an approximately equal allocation of seven Dynamic hedge funds; the Power Hedge Fund, Alpha Performance Fund, Contrarian Fund, Power Emerging Markets Fund, Income Opportunities Fund, Strategic Value Fund, and Focus+ Alternative Fund.
The Dynamic Funds are managed by Goodman & Company, Investment Counsel Ltd., a subsidiary of DundeeWealth Inc. DundeeWealth is listed on the Toronto Stock Exchange.
