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.
Financial-Planning.com – Many alternative asset managers, who brag about their ability to make money regardless of market conditions, posted their worst figures in years last month after worldwide sentiment suddenly changed on energy prices, financial stock and the U.S. dollar.
The hedge fund with the biggest loss is SRM, the Monaco-based group that took a huge gamble on Northern Rock last year. When Northern Rock was nationalized, the group lost approximately 85% of its investors’ money, according to The Wall Street Journal.
Many hedge funds were placing huge bets that energy prices and mining stocks would continue to soar and financials would continue to fall, but when that trend reversed last month, they took a major beating.
"There was a tendency for funds that did well in June to do badly in July," Christopher Fawcett, head of Fauchier Partners, told The Times.
West Palm Beach (HedgeCo.net) – Hedge fund Provider, Fidelity ActionsXchange, has appointed Laura J. Pollard as executive vice president and head of the company. Pollard will report to Larry C. Renfro, president of Fidelity Developing Businesses, a new division that comprises a number of growing businesses and strategic initiatives for Fidelity.
“Working in partnership with ActionsXchange’s management team, Laura has done an outstanding job of leading the company over the past several months, and I am confident that her industry experience, proven strengths as a leader and ability to build strong relationships with clients will position her for success in her new role,” said Renfro. “Laura will lead a talented and experienced management team that will continue its focus on providing the most accurate, timely, and comprehensive global corporate actions information to our clients.”
Pollard, a 19-year Fidelity veteran, will lead all aspects of ActionsXchange’s day-to-day operations. Prior to her new role, Pollard spent the past two years as ActionsXchange’s senior vice president of client services, product development and implementation. Before joining ActionsXchange, Pollard spent four years at Fidelity Charitable Services and 13 years in a variety of leadership roles in Fidelity’s 401(k) retirement services and benefits outsourcing divisions.
ActionsXchange was formed in 1997 to offer corporate actions processing software and outsourcing solutions to financial institutions. Operating as an independent company, ActionsXchange partners with more than 50 major global financial institutions such as banks, asset managers, hedge funds and broker-dealers.
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New York Times – The Blackstone Group may be best known as an immense private equity firm, but the firm’s earnings report on Wednesday made it clear that Blackstone has been buoyed by its hedge fund operations.
Blackstone reported $165.6 million in profit for its second quarter, excluding costs tied to its initial public offering last June. That represented a nearly 75 percent drop from the same period last year, a consequence of the troubles still plaguing the credit markets. On the basis of generally accepted accounting principles, the firm reported a pretax loss of $185.5 million.
Yet Blackstone’s results, which amount to 15 cents a unit, still beat the average analyst estimate of 8 cents a unit, according to Bloomberg News.
Other publicly traded alternative-asset managers also reported quarterly earnings on Wednesday. Och-Ziff Capital Management, a big hedge fund, said it earned $93.3 million, while GLG Partners, a large hedge fund based in London, reported profits of $44.2 million. Both figures exclude costs related to the firms’ public offerings.
West Palm Beach (HedgeCo.Net) – Baader Wertpapierhandelsbank AG has been granted membership to the Compensation Fund of German Banks (EdB) by the German Financial Supervisory Authority (BaFin).
Once the entry into the commercial register has been completed, the institution will be known under its corporate name, Baader Bank AG.
"Receiving the full banking licence is a significant sign of the faith that is placed in the capability of our bank’, commented Uto Baader, Chairman of the Baader Board of Directors.
The bank operates as an all-round service provider for asset managers and other institutional customers as well as an arranger of financial innovations. The main products and services provided by the bank include certificates, publicly offered funds, single hedge funds and funds of hedge funds as well as managed accounts.
Baader Service Bank currently has 26 employees and reported net profit of EUR 0.56 million ($1 million) with total assets of EUR 53.3 million ($83.2 million) in 2007.
Reuters Singapore- Assets managed by fund managers in Singapore grew 32 percent to S$1.173 trillion (431 billion pounds) last year, driven by a doubling in assets held by hedge funds, the central bank said on Thursday.
"This is the seventh consecutive year of double-digit year-on-year growth in total assets under management registered by Singapore-based asset managers," the Monetary Authority of Singapore said in a statement.
Singapore has invited asset managers, private banks and hedge funds to boost its fast-growing financial industry as it tries to reduce the economy’s reliance on manufacturing.
West Palm Beach (HedgeCo.net)- A Hedgeweek Special Report for March 2008 shows a strengthening of the South African hedge fund industry from just a few funds with aproximately ZAR1.4 billion ($0.18 billion) in as recently as mid-2002, to more than 130 funds with at least ZAR26 billion ($3.35 billion) in assets under management.
In the report by Simon Gray, he says, "Industry members predict that the current soaring growth rate will be maintained for some time, pointing to plentiful capacity available in existing funds and a level of allocation to alternative assets which remains well below those in other markets."
The constrictive rules governing the South African hedge fund industry has constrained investors from investing in alternatives in Africa, Gray reports, instead, investors have focused more on Asia and Latin America.
Gray predicts that factors are set to change to the benefit of South African managers, many of which are now developing the extended track records of success that conservative institutions are looking for.
"The industry is becoming broader and more sophisticated as established asset managers launch alternative products, and the dominance of equity long/short and market neutral strategies gradually diminishes while the asset share of multistrategy funds soars." Gray concluded.
Hedgeweek was launched in October 2002 and is part of the London-based Hedgemedia group, founded by financial publisher Sunil Gopalan and internet entrepreneur Oliver Bradley. Hedgeweek now reaches over 3,000 senior executives at hedge fund companies and investor groups worldwide.
West Palm Beach (HedgeCo.net)- According to a new report by DataMonitor, ‘Hedge Funds in Europe 2008′, the European hedge fund market is going through a period of growth but the extent of the mortgage-backed security crisis is still uncertain.
The report forecasts strong growth in funds of hedge funds over the next year, with less demand for single hedge funds according to 65% of asset managers in Europe.
Asset managers in Spain and Italy believe most strongly that the demand for funds of hedge funds will outstrip that for single hedge funds, followed by France, Germany and finally the UK.
Across the five core economies in Western Europe – France, Germany, Italy, Spain and the UK – institutional investors now dominate the market for hedge funds. On average, slightly more than two-thirds of asset managers confirmed that this group represents their biggest customer segment for hedge funds today.
40% of asset managers in Italy say mass market investors may also be put off by the price of hedge fund investment. In Spain, on the other hand, demand from mass market clients is being limited by competition from capital-protected and structured products and inadequate promotion of hedge fund products by banks and advisers.
DataMonitor, a provider of online database and analysis services for key industry sectors, has put out the report presenting views on the market for hedge fund investment based on a survey of 100 leading asset managers across Europe.
Covering mass market, high net worth and institutional customer groups, ‘Hedge Funds in Europe 2008′ is part of a series of reports looking at the market for alternative investments in Europe.
TOKYO, June 27 (Reuters) – Japan has relaxed its tax code so foreign asset managers and hedge funds can avoid dual taxation, as part of Tokyo’s push to revive itself as a global finance centre.
In a two-step process that began in April with the revision of a cabinet order and finished on Friday, the government has retooled tax rules so offshore funds can avoid being classified as having a "permanent establishment" in Japan.
Commonly referred to as a "PE" in tax law, the classification would force offshore funds — which already pay taxes in their home countries — to pay domestic taxes on any returns made in Japan.
Faced with sluggish growth and a rapidly shrinking population, the world’s second-largest economy is desperate for foreign investment and is especially keen to woo hedge funds, which have an estimated worth of $2 trillion globally.
West Palm Beach (HedgeCo.net)- Hedge fund managers, gurus and ‘Out of the box’ guest speakers are gathering at the Grimaldi Forum to debate distressed investing issues and macro strategies for 2008.
The 14th Annual Gaim International 2008, a global hedge fund industry conference is being held tomorrow through Thursday in Monaco. The conference has 40 slots over 3 days and will cover issues such as the state of the world economy to strategy and hedge fund philanthropy.
1100 investors, distributors and asset managers are expected at the hedge fund industry’s flagship conference, attracting the largest proportion of asset allocators in hedge funds than any other alternatives event.
Hedge fund experts are scheduled to speak at the meeting, and the guest speakers include former holder of the land speed record, Richard Noble.
The conference is taking place as the $2.6 trillion hedge fund industry confronts poor returns and investor outflows and searches for a follow-up to the favored strategy for 2007, which was taking bets on the explosion in subprime loans.
Reuters- More merger and acquisition activity among fund firms is likely as the industry faces up to a tough 2008, said Mark McCombe, head of HSBC’s asset management arm, which is to rebrand next month.
McCombe, chief executive of what will be known as HSBC Global Asset Management and include the firm’s hedge fund, quantitative, liquidity and multi-manager arms, said the funds industry had had a tough time over the past year and faced further difficulties this year.
"You had this almost perfect storm situation, where liquidity dried up, dislocation, added to which you then built in volatility … I think you can say this year will be a difficult year for all asset managers and for differing reasons," he said in a recent interview.
