New York Times – Hedge funds are facing many agonies. They are tortured by redemptions. Then there are “high water marks,” another now-troublesome part of their model. They need to fix such flaws if they are to fight another day.

The list of funds blocking investors from withdrawing their money is growing daily. Tudor Investment, the Fortress Investment Group and dozens of others have done so, at least temporarily. The rationale is to protect the fund’s remaining investors, who can be harmed if the fund needs to deplete its cash balance or sell assets at fire-sale prices.

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Tags: ashe, bridgewater-associates, complexity, counterparties, failure, fund-raisers, june-14, losses, medallion, third-party

The Money Times – Last year, I read an article in which David Herro outlined his rationale for owning shares of UBS in his Oakmark International fund. He focused on the value of its wealth management unit, which delivers stable earnings and benefits from the spread of wealth across the globe. Fair enough, but UBS’ most recent quarterly results show the bank’s abysmal performance in other areas is now tarnishing its crown jewel.

After a fourth straight quarterly loss due to subprime writedowns, UBS’ Wealth Management unit suffered net outflows of 19.3 billion Swiss francs ($18.8 billion) — its first net outflows since the fourth quarter of 2000.

In response, the bank is reversing its "one bank" strategy by giving increased autonomy to its three businesses: Investment Banking, Wealth Management, and Asset Management. The initiative could pave the way to a spinoff or sale of the investment banking business.

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Tags: amount-of-money, art-collector, bad-news, dud, fund-raisers, j-p-morgan, joseph-gregory, mate, richmond, rough-price, summer-intern, third-party, volatility

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