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West Palm Beach (HedgeCo.net) - Renaissance Institutional Futures, a $3 billion futures fund run by hedge fund management company, Renaissance Technologies, has waived all it’s management fees for 2009, even if the fund delivers good results in 2009, according to the Wall Street Journal.
Renaissance told investors in a end-of-year letter that the futures fund was waiving it’s 1% fixed management fee following poor performance in 2008. The discount is estimated by the Journal to save investors $30 million.
Renaissance Technologies was started in 1982 by James Simons, Renaissance currently has approximately $20 billion in assets under management. The company operates in East Setauket, Long Island, New York, near Stony Brook University. Administrative functions are handled out of offices in Manhattan.
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The Australian - After suffering one of the worst years on record, Australia’s $62 billion hedge fund industry is bracing for even tougher times in 2009 as a confluence of factors works against them, including poor performance, more regulation, further short-selling bans, and a flood of redemption requests in late 2008 that are due to be repaid right about now.
The result is that an unprecedented level of cash is being pulled out of hedge funds and funds-of-hedge-funds by investors this quarter, just as they face millions of dollars of losses from the ban on short selling.
It is no surprise, then, that a lot of lobbying is going on behind the scenes to ensure that corporate watchdog ASIC lifts the ban on short selling financial stocks on January 27.
But speculation is running hot that the ban will be rolled over and some believe it could remain until the credit crisis subsides — a move hedge funds can ill afford.
In Britain, the ban is due to be lifted on January 17, but Andrew Baker, deputy chief executive of the Alternative Investment Management Association, recently said the ban could last for the entire length of the financial crisis.
The Associated Press - College endowments and state pension funds plowed billions of dollars into hedge funds and private-equity investments as a way to balance their stock holdings, and for a time they got supercharged returns.
Those days are over. From Harvard University to the state pension fund of California, officials are watching the value of their alternative investments shrink.
So far, the losses are mostly on paper, but analysts say they could eventually lead to reduced payouts to retirees, higher taxes so state governments can fulfill their promises, or less cash available for colleges to give out financial aid.
Denver Post - College endowments and state pension funds that once plowed billions of dollars into hedge funds and private-equity investments as a way to balance their stock holdings officials are watching the value of their alternative investments shrink.
So far, the losses are mostly on paper, but analysts say they could eventually lead to reduced payouts to retirees, higher taxes so state governments can fulfill their promises, or less cash available for colleges to give out as financial aid.
In recent years, endowments and pensions heaped cash into hedge funds — private investment funds that often use unconventional and risky trading strategies. They also bought into private-equity funds, which make direct investments into private companies or buy them out.
New York Times - Some of the nation’s universities are trying to sell chunks of their portfolios privately as their endowments swoon with the markets.
Among institutional investors, school endowments aggressively embraced private equity, real estate partnerships, venture capital, commodities, hedge funds and other so-called alternative investments over the last few years. Endowments with more than $1 billion in assets reported 35 percent of their holdings in these types of investments on average last year, a much greater portion than big public pension funds, for example.
Times Online - People who run hedge funds hate the way the press describe them as “secretive”. A quick Google of “hedge funds” shows what a cliche it has become. Hedge funds are “notoriously secretive” and “super-secretive”; they live in a “secretive world”.
But sadly, for an increasing number of them, the secret is finally out.
The promise behind this $2 trillion universe was that its managers would make money whether markets went up or down. But the turmoil in the financial world is proving too much for many of them. All of a sudden the Masters of the Universe are failing fast.
The average hedge fund has lost more than 4% this year, according to Hedge Fund Research, putting the industry on course for its worst year on record. New investments in hedge funds for the first six months of 2008 fell below $30 billion, compared to $118 billion for the same period last year.
The hedge fund manager has become the Gatsby figure of our era. But his fall will be felt by more than Manhattan estate agents, art galleries and Porsche dealers. Over the past decade, the hedge fund industry has grown fivefold, pumped up with billions from corporate and public pension funds and university endowments looking for market-beating returns.
The hedge fund manager has become the Gatsby figure of our era. But his fall will be felt by more than Manhattan estate agents, art galleries and Porsche dealers. Over the past decade, the hedge fund industry has grown fivefold, pumped up with billions from corporate and public pension funds and university endowments looking for market-beating returns.
HedgeFund.Net - Swiss funds-of-funds firm Gottex Fund Management is launching a fund that will emulate the investment principles of U.S. “super endowments.”
The new fund will emulate the investment principles of successful U.S. university endowment funds, such as Harvard and Princeton. It will allocate about 65% to alternative investments. The alternative part of the portfolio will cut across all asset classes: hedge funds, private equity, commodities, long-only equity, fixed income, real estate and other real assets.
Harvard Management, long the model for university endowment funds currently with about $35 billion in assets, increased more than 20% year over year in 2007.
William Landes is helming the new fund. Landes joined Gottex from Boston-based 2100 Capital, his hedge fund specialty firm that Old Mutual Asset Management bought in 2005. Before that Landes was a money manager at Putnam Investments, which helped incubate 2100 Capital.
Wall Street Journal - Not long ago, hedge funds were reserved for a few wealthy investors and even fewer pioneering managers. Now 7,500 funds have nearly $2 trillion under management globally, according to Hedge Fund Research — increasingly from endowments and pension … Read Complete Article
Boston Globe - Massachusetts again has some of the best money managers in the world. But unless you’re a public employee or the parent of a Harvard student, you won’t benefit much from this tremendous talent.
Harvard University’s endowment, already the nation’s largest university endowment, earned 7 to 8 percent over the past year, a period when stock markets tanked and many investment professionals lost substantial sums. Harvard’s performance, first reported yesterday by The Wall Street Journal and confirmed by a financial industry source briefed on the school’s returns, puts it at the top of an elite group of institutional investors.
Financial firm Northern Trust col lects returns on 87 endowments and foundations but not Harvard. Nevertheless, the Cambridge university’s performance would put it "at the top of the class," said Northern Trust spokesman John O’Connell.
FT Alphaville- New figures from Singapore’s central bank bear out the (abundant) anecdotal evidence of the quickening exodus of Asia-focused hedge funds out of Japan and elsewhere and into Singapore.
Reuters reports that assets managed by fund managers in Singapore grew 32 per cent to S$1,173bn ($862bn) last year, driven by a doubling in assets held by hedge funds.
Assets managed by hedge fund managers in Singapore doubled to close to S$80bn in the year, while the number of hedge fund firms in Singapore increased by more than 50 per cent to almost 300, according to the island state’s Monetary Authority. Meanwhile institutional investors such as pension funds, endowments, foundations, companies and financial institutions accounted for 43 per cent of the funds.
Reuters UK- Roughly three dozen U.S. hedge funds have opened for business so far this year, 50 percent less than the same period last year, according to data released on Tuesday that underscored how tough it is to launch one of these portfolios now.
But the data also shows investors, like pension funds, endowments and wealthy individuals, are still flocking to these loosely regulated funds in search of better returns as the credit crisis and slower economic growth dents performance.
According to numbers compiled by trade magazine Absolute Return, the 35 new funds began trading with a total of $19.5 billion (9.9 billion pounds) in the first six months of 2008. That compares with 72 funds launched with $14 billion in the first half of 2007.
Reuters- Meeting long-term funding obligations can be the stuff of nightmares but that’s what hedge fund industry veteran Philip Duff says his new firm can do to help pension funds, endowments and insurers tackle.
For years, Duff has warned these organizations could soon run out of money and has urged them to find a fresh approach.
Now he is offering help through Duff Capital Advisors, his four-month-old company that offers not only hedge funds but products that could set actuaries’ hearts racing. For example, its risk analysis models can help insurers calculate ways to hedge mortality risk and help clients select appropriate types of investments.