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.
Hedge funds and financial institutions based in the Cayman Islands have been pulling their money out of Britain as they are hit by the credit crunch, according to figures from the Bank of England.
The low-tax regime and limited regulation of the Cayman Islands – with a population of 52,000 – has attracted 80% of the world’s $1.3tn (£790bn) hedge fund industry.
Those institutions have almost halved their deposits in UK banks over the past 12 months, from $356bn at the end of the first quarter in 2008, to $173bn at the end of March, Bank of England data shows. The drop in Cayman Islands’ deposits comes as hedge funds are being forced to return money to investors who have made big losses from the financial crisis. It also reflects fund losses from falling markets.
The outflow of funds from Britain puts the spotlight on hedge fund threats to abandon the UK because of higher taxes, tighter regulation and potential caps on executive pay and bonuses.
Pensions & Investments – While every move of the New York State Common Retirement Fund is in the spotlight these days, what the bright lights don’t reveal are the dramatic improvements in the fund during the past two years.
An alleged massive pay-to-play scheme centered on the fund’s alternatives investments while Alan G. Hevesi held the New York state comptroller’s position from 2002 through 2006 has dominated the news about the pension fund for more than a month.
Mr. Hevesi’s successor, Thomas P. DiNapoli, immediately began reforming the investment department of the Albany-based fund once he took the helm in February 2007.
This is Money – ‘The big principle to come out of this is we have to care about things that are systemically important, and if necessary regulate them – and that includes hedge funds,’ said one UK official.
It marks a major setback for the shadowy world of hedge funds, which have largely escaped the spotlight during the current crisis because of the woes of the banks.
Reuters – Investment firm SW1 Capital said on Friday it has bought into hedge fund platform PCE Investors and plans to build a controlling stake, cutting private equity firm Ubequity Capital Partners’ own holding.
PCE runs $1.6 billion (1.1 billion pounds) in assets and by next month will have 21 funds, run by 15 teams, in its stable. SW1 is hoping to exploit greater demand for robust and transparent hedge fund operations, thrown into the spotlight by the financial crisis and Madoff scandal.
The deal initially sees two-thirds owner Ubequity temporarily increase its holding as it and SW1 buy out minority shareholder Schneider Trading Associates.
