Reuters UK – JPMorgan Europe Dynamic fund favours defensive drugmakers and non-life insurers and has no plans to move into cyclicals until company newsflow, employment and money supply improve.

John Baker, portfolio manager of the 260 million euro (233.52 million pounds) fund, told Reuters his portfolio was invested in stocks with good newsflow and was mainly defensively positioned.

Baker favours GlaxoSmithKline which has taken a lot of cost out of its business and whose operating margins are improving, surprising the analyst community positively, he said.

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Tags: analyst community, cyclicals, dynamic-fund, europe, glaxosmithkline, john baker, jpmorgan, life-insurers, money supply, operating margins, portfolio-manager, reuters, stocks

Times Online – Hedge fund managers are paranoid. And they are right to be. The other day I had lunch with a senior financial official whose view of hedge funds was simple. “They were a con. The returns were all due to leverage. And now that the leverage has gone everyone will see they were a con.”

You may disagree with this analysis. You may be convinced that for some hedge funds at least the returns were down to skill. You may argue that their role in the credit crisis has been at worst neutral. But you cannot deny it is pretty worrying for hedge funds when this is the view of a top regulator.

And my lunch companion is not alone. According to an e-mail from Dick Fuld, the former chairman of Lehman Brothers, quoted by The Wall Street Journal, Hank Paulson, the US Treasury Secretary, said he wanted to “kill” the bad hedge funds and “heavily regulate the rest”. The Italian Finance Minister has promised to put the extermination of hedge funds on the international agenda when Italy takes over presidency of the G8 in January.

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Tags: alan-greenspan, civil-lawsuit, combination-of-the-two, distribution-network, eton-park, journalism, lehman-brothers-holdings, life-insurers, neuberger-berman, squeeze