Philip Falcone

The Phantom

Falcone, 46, has been dubbed the "Midas of misery" for taking lucrative short positions in the shares of struggling banks including HBOS and Wachovia. He lives in a 27-room townhouse on Manhattan’s Upper East Side bought for $49m. The youngest of nine children, he grew up in Minnesota and was a young ice hockey star dubbed "the phantom" for his ability to elude defenders.

Kenneth Griffin

The Boy Wonder
As a Harvard University student Griffin installed a satellite dish on his dorm to help him trade options. His Citadel Investment Group, founded in 1990, has 1,200 staff and was tipped as the next Goldman Sachs, but its two main funds have lost 35% of their value in the market turmoil. Griffin, 40, was a high-profile donor to the presidential campaign of fellow Chicago resident Barack Obama.

James Simons

The Mathematician
Born in 1938, Simons was a maths prodigy. He worked as a codebreaker for the US defence department in the 1970s and set up his Renaissance Technologies fund, which has some $20bn under management, in 1988. Known as a "black box" fund, it uses opaque quantitative techniques. Its core Medallion fund rose 49% in the year to September. Simons has a $600m charitable foundation.

John Paulson

The Sub-Prime King
Low-profile Paulson made $3.7bn last year betting against sub-prime mortgages. A 52-year-old father of two, he was raised in the New York borough of Queens, gained an MBA from Harvard and has a $41m lakeside retreat in the Hamptons. His firm, Paulson & Co, manages $35bn and its advisers include Alan Greenspan. Reports suggest a bumper year, with the firm’s main funds rising by between 15% and 25%.

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West Palm Beach (HedgeCo.net) – Pure Capital Limited, a quantitatively-driven hedge fund specializing in “targeted non-correlation” saw strong performance from their “Pure Bespoke” customized portfolio solutions in October – with client account performance ranging from +4% to +10% for the month.

Pure Capital’s year-to-date average performance across all products was +26% at month-end October 2008. Medium term correlation coefficients ranged from -0.15 to -0.80.

"We have a range of quantitative techniques through which we both deconstruct and analyze portfolio performance." Anthony Limbrick, Pure Capital’s Chief Investment Officer said, "Once portfolio performance drivers have been specified, customized portfolio solutions are built using a series of proprietary building blocks, each of which is designed to address specific types of pay-offs".

In September the Paris-based EDHEC Risk and Asset Management Research Centre published a report on overlay hedging in fund of funds. The report, authored by David E. Kuenzi, Remy Chaudhuri and Zhihui Dong of Glenwood Capital investments concluded that “a hedging capability removes a significant constraint from FoFs” and “should have the net result of improving alpha, allowing for more unique and idiosyncratic portfolios, and for more creative structured products”.

Limbrick highlighted the benefits to a European fund of fund of implementing a Pure Bespoke solution – “if one were to use the Eurekahedge European fund of funds index as a fund of fund proxy, our Pure European BetaMatch program could have reduced fund of fund losses from almost 19% year-to-date to less than 1%. Not only would performance have been improved, but there would have also been more cash available for redemption needs. We also give our clients the choice of upside beta exposure if they require it”.

In response to a question regarding the type of client exposures hedged by the Pure Capital, Limbrick said the Pure Bespoke portfolio solutions typically address “pervasive equity beta exposures or potential gap risk issues but we do look forward to widening the approach to address a range of more exotic or dynamic exposures”.

Alex Akesson

Tags: advisory-services, bond-trading, boston, current-value, due-diligence-service, million-21, prison-term