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Hedge Week.com - Pacific Alternative Asset Management Company, an Irvine, California-based fund of hedge funds manager with USD9bn in assets has announced the recruitment of the investment team of KBC Alpha Asset Management, a USD700 million Asia-focused fund of hedge funds manager.
KBC Alpha was established in 2001 by chief investment officer Neale Safaty as the fund of hedge funds division of KBC Alternative Investment Management. The fund investment team will be integrated into Paamco’s global portfolio management team and will initially operate as a separate division within the firm known as Pan Asia Alpha Strategies.
West Palm Beach (HedgeCo.net) - Finvest Asset Management is set to launch a new capital protected offering for investors who are seeking to generate annual returns of between 12-20 percent in a low risk structure.
The total offering is for $500 million and is open to non-U.S. investors only. The capital protected product will be offered to investors in the form of a U.S. Dollar denominated subscription. Downward pressure on the Euro relative to the dollar, will further enhance the investment and provide a source of upward performance for investors.
The Zurich-based Asset Management company has also received a mandate to allocate around $300m to the fund of hedge funds sector as part of a low-risk strategy to capitalise on the turbulence in global financial markets market.
Allocations will be made to funds that have a track record of at least three years, have an attractive Sharpe ratio, and are targeting annual returns of between 10 and 15 per cent. Funds of funds that may have incurred negative returns will not be excluded from the selection process.
"The decision to allocate to a hedge fund goes against the current trend," says Finvest portfolio strategist Mayer Greenwald. "However, we see a tremendous amount of upside in the fund of funds space, providing that portfolio managers apply the appropriate risk management." He argues that a good fund of funds can provide value in its ability to optimise allocations and achieve an appropriate risk/reward profile.
Finvest currently operates an office from Zurich and recently announced plans to open an office in London and Cypress. It also manages the Finvest Primer and Finvest Yankee funds.
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Reuters India - Goldman Sachs said it has regulatory approval to launch mutual funds in India, Asia’s third-largest economy, joining the likes of AIG, JPMorgan and South Korea’s Mirae Asset who have started operations in the past 18 months.
Adam Broder will be the chief executive of Goldman Sachs Asset Management Company (India) and Prashant Khemka will be chief investment officer, the firm said in a statement on Monday.
"India is one of the most important countries to our Asian business and we have a long-term strategic commitment to this market," Broder said.
India’s 35 member funds industry managed about 5.4 trillion rupees at the end of July, data from the Association of Mutual Funds in India showed.
While the industry has been hit by a fall of about 30 percent in the Indian stock market this year, Boston Consulting Group has forecast assets could more than quadruple by 2015.
New York (HedgeCo.Net) - Paul Eustace, former head of Philadelphia Alternative Asset Management Company, has been ordered to pay back nearly $300 thanks to his fraudulent ways.
According to a statement by the Commodity Futures Trading Commission, the Canadian resident was able to swindle clients by constructing false account statements and exaggerating the fund’s portfolio worth.
Prosecutors alleged that Eustace was able to hide losses from his clientele while the fund experienced trouble from October 2002 to May 2005, when the fund collapsed. He has been indicted on two criminal counts of commodities fraud.
Philadelphia Alternative Asset Management was a commodity fund that was peddled as a hedge fund. Eustace was able to raise about $230 million, despite the fact that his company never traded options or futures on the investor’s behalf.
The Philadelphia-based law firm of Stradley, Ronon, Stevens & Young will act as the collector and has already recovered $96 million. In addition to returning the money to investors, Eustace has also been ordered to cough up $12 million in civil penalities.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
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New York (HedgeCo.Net) - At a time when most investors are becoming increasingly weary of high risk hedge funds, public pension funds are upping their stake, hoping to make up for recent lackluster performances.
New York State has a cap that limits the amount of alternative investments in the state’s Common Retirement Fund, valued at $153.9 billion. Comptroller Thomas DiNapoli is urging lawmakers to increase that cap, saying that “we need more flexibility.”
The Common Retirement Fund has followed in the footsteps of other lagging pension funds, posting only a 2.6 percent gain for the year ending March 31. As of now, the fund may allocate up to 25 percent of its capital to alternative investments. DiNapoli did not state how much he wanted that number increased.
Public funds manage over $2 trillion in assets and are actively seeking ways to garner larger returns. However, some argue that market conditions are not favorable enough to start taking wild risks with taxpayer money. Alternative Investments may include hedge funds, private equity funds, or anything that invests in real estate and/or commodities such as oil or gold.
One of Amaranth Advisor’s major investors was the state of Massachusetts, who allocated a substantial amount from its Pension Reserves Investment Trust Fund. When the fund imploded thanks to some bad bets magnified by massive amounts of leverage, followed by the closing of Sowood Capital Management the following summer, the state fund was out $80 million.
In Orange County, the Employees’ Retirement System has invested 7% of their assets into the reputable BlackRock, as well as to Pacific Alternative Asset Management Company. The fund of funds will handle over $200 million of assets. In addition, South Carolina may invest over $13 billion of their total assets worth $29 billion in hedge funds and other alternative investment vehicles.
Julie Scuderi Senior Editor for HedgeCo.Net Email: julie@hedgeco.net
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds! Be sure to check out our sister sites. For more information, visit www.hedgeconetworks.com
West Palm Beach (HedgeCo.net) - Lee Hetfield has joined ARE Asset Management LLC, a distressed credit and distressed real estate asset management company in Florida, as Portfolio Manager.
Hetfield reports that as of May 30, 2008, ARE Asset Management launched ARE Opportunity Fund, Ltd. (British Virgin Islands). The fund works in purchasing mortgage loans, the strategy is generating returns using both loan modifications negotiated with borrowers to create loan re-performance, as well as loss mitigation techniques. Re-performing loans are held for income or sold to securitizers or other investors for a gain.
Loans that cannot re-perform, resulting in “REO” or real estate owned property, are resolved via a property sale or entered into a rental income program. The fund also opportunistically invests in senior commercial loans backed by improved real estate at low LTV’s (50-65% of 90 day liquidated value, 35%-45% of BPO), through high-yielding originations made by an affiliated commercial loan originator, SeaBreeze Financial.
The investment manager currently has $110 million under management under the strategy as that of the fund, and the results since launch have been encouraging: For the month of June the BVI fund was up 1.59%, net of expenses, and July looks to be up ~1.5% (early est.). Prior to the BVI fund launch The Manager has historically managed funds for offshore investors in fixed-term, LLC structures (in the same distressed/credit opportunities strategy).
The team is spearheaded by Jeffrey Kirsch with over 30 years of experience in commercial and residential real estate. He has managed the ARE group of companies, based in Miami, FL, since their founding in 1996. At ARE, Mr. Kirsch has overseen more than $1 billion in performing and non-performing mortgage transactions and has long-standing relationships with private and public-sector sellers.
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