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.
Seeking Alpha – The innovators were out with guns blasting as they introduced an ETF that acts like a hedge fund. How has it been doing since the March 25 launch?
This new ETF, established by Index IQ analyzes publicly available hedge fund performance data and then tries to replicate returns utilizing ETFs and other liquid trading vehicles. Additionally, it promises to perform as well as a hedge fund without the risk and with low correlation to traditional assets. Another benefit that this ETF could offer to investors is risk reduction because of its low correlation with the stocks and bonds that already dominate an investor’s portfolio.
Houston Chronicle – Hedge funds, historically an investment reserved for big-ticket investors, are seemingly like mutual funds in that they typically invest in stocks and bonds. They have the added glamour and allure, however, of taking significant risks and gambles with their investments. Hedge funds may take risks by purchasing derivatives, or they may bet on the fall in price of particular securities by selling the securities short. (When you short sell, you borrow a security from a broker, sell it and then hope to buy it back later at a lower price.) Some hedge funds even invest in other hedge funds.
Earlier this decade, hedge funds got lots of attention, and plenty of wealthier investors were throwing big bucks into them. The allure was hedge funds claiming to have sidestepped the bear market in the early 2000s.
Bloomberg – The biggest-ever decline in commodities turned Pierre Andurand and Chris Levett into this year’s heroes for investors.
Andurand’s $1.1 billion BlueGold Capital Management LLP hedge fund in London almost tripled between its February debut and November by betting on higher oil prices in the first half of 2008 and then reversing the strategy, the 31-year-old manager said. Levett’s $3 billion London-based Clive Capital LLP returned 44 percent in the first 11 months of the year.
The first bear market in commodities since 2001, as measured by the UBS Bloomberg CMCI Index, cut investments in raw materials to $144 billion from a peak of $270 billion in the second quarter, Barclays Capital estimates. While the CMCI rose almost fivefold from 2001 to 2008, beating stocks and bonds, commodities measured by the Reuters/JefferiesCRB Index fell 53 percent since June and are heading for the worst year in five decades.
