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.
Gulf News – Short-selling, one of the few tactics that made money for hedge funds in 2008, has become a risky bet as prospects for equities have improved, while getting hold of stock to sell is harder as lenders shun weak funds.
Some hedge funds have already changed tactics and are simply buying cheap stocks, wary of getting burnt if a stock they are shorting announces unexpectedly good earnings and the share price spikes – a real possibility in an improving economy.
High-profile hedge fund manager Philippe Jabre said he had no short positions because it was "too dangerous", although in future shorting could prove a better trade.
Reuters – World stocks steadied on Friday but were still on track for a sixth consecutive week of gains, while the euro fell on worries about the region’s prospects.
MSCI‘s main world stock index was flat despite modest gains in Europe and a rebound in Japan. But the index was up 1.6 percent on the week, gaining around 28 percent since a March 9 low.
U.S. financial services firmState Street said evidence was building that big investors were buying into the rally, particularly in U.S. and emerging market stocks.
Bloomberg - A hedge fund manager who used the same defense lawyer as Bernard Madoff received a sentence that was a third of the maximum possible after he was convicted of defrauding investors out of $10 million.
Vincent Montagna remains free on bail more than two years after pleading guilty. He was sentenced to 40 months in prison instead of a possible 9-year term. His lawyer, Ira Sorkin, also represents Madoff, the New York investment adviser U.S. prosecutors accused of running a $50 billion Ponzi scheme.
Though Montagna and Madoff aren’t known to be connected beyond their choice of attorney, the case may provide a window on Madoff’s prospects in avoiding or reducing the maximum 20 years in prison he faces if convicted. Madoff, 70, is free on bail, though restricted to his Manhattan apartment.
BusinessWeek – With the price of gold racing higher over the past two months, more investors are coming around to the notion that the precious metal may be the best option to protect against a possible economic catastrophe. Among the surprise new buyers? Star hedge fund manager David Einhorn.
Gold rose steadily from its November 2008 low of $682 to close at $910.70 on Jan. 26, a five-month high. Despite selling off about $10 an ounce over the next two days, investors, it seems, have realized that much of the Federal Reserve’s plan for fighting the credit crunch and reviving the economy are also likely to bolster gold’s prospects.
Reuters – Barack Obama takes over as U.S. president on Tuesday with hopes riding high he can conjure
up a rescue that will jolt the world’s biggest economy back to life and contain the financial crisis ravaging global markets.
The first African-American to become U.S. president will take his oath against the backdrop of plunging world stock markets, prospects of a drawn-out U.S. and global downturn, a trillion dollar federal deficit and fears of more crippling bank losses.
