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Bloomberg - Salida Capital Corp., a Toronto-based hedge-fund manager with assets of about C$900 million ($834 million), halted redemptions on three of its funds after the bankruptcy of Lehman Brothers Holdings Inc.

Lehman acted as prime broker for Salida’s C$157 million Global Opportunity Fund, the C$85 million Global Prospector Fund and the C$64 million Global Arbitrage Fund, Managing Director Courtenay Wolfe said in an interview.

Salida is one of dozens of investment managers worldwide whose Lehman prime-brokerage accounts were frozen when the New York-based company filed for protection from creditors on Sept. 15. Large securities firms such as Lehman typically offer prime brokerage services to hedge funds and professional investors that borrow stock and cash to invest.

“The Lehman issue is something we are navigating through,” Wolfe said today in a telephone interview from Toronto. “We are working very hard to get the securities back for our firm and our investors because we believe they are rightfully and legally ours.”

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New York (HedgeCo.Net) - The SRM Global Master Fund, headed by former UBS AG star trader Jonathan Wood, is down about 85% over the course of its two-year tenure, according to a report by the Wall Street Journal. 

Launched in September 2006, the fund grew fast, raising over $3 billion in assets in what was one of the largest European hedge fund kick-offs ever.  The fund held long equity positions in companies that were involved in takeovers, mergers or restructurings.  

Mr. Wood’s stellar UBS reputation earned him the trust of many affluent investors.  However, venturing into a hedge fund is very different territory.  Investors agreed to higher than normal lock up periods, some as long as five years, apparently not too concerned about potential risks.  Now many are barred from cashing out or even cutting their losses. 

The SRM fund has had a string investments gone sour.  They held a major stake in Northern Rock, which was nationalized by the British Government last year, causing shares to plummet.  Wood is currently seeking a judicial review. 

Adding to the unlucky investments is the stake that SRM held in Countrywide.  The mortgage lender was taken over by Bank of America for a deal that Wood thought undervalued them greatly.  Bank of America ended up with a steal, purchasing Countrywide for $2.5 billion. 

One notable investor in SRM is UBS, who in addition to providing their prime brokerage services, allocated about $500 million to the fund. 

Julie Scuderi
Senior Editor for HedgeCo.Net
Email: julie@hedgeco.net

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Reuters- Acceleration Capital Group is the latest entry into the capital introduction space, and plans to offer services that give emerging hedge fund managers an edge for growing their businesses. Acceleration Capital was incorporated toward the end of March as a unit of Saratoga Prime Services, a multi-custody introducing broker-dealer platform that clears through Goldman Sachs, Bear Stearns and Interactive Brokers.

"Our view of the industry is that prime brokerage services are extremely necessary but somewhat commoditized, and the pricing and buying of stock is not much different from shop to shop," said Lance Baraker, one of the founders of Saratoga. "But hedge funds are also looking for branding, and it helps to have a global brand name as prime broker partner and on your documents.

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