Fir Tree Ex-Partner Planning Fund Launch (HFAlert.com)
A former Fir Tree Partners executive is planning a fund that would invest predominantly in debt and equities outside the U.S. Aaron Stern departed Fir Tree’s New York headquarters in recent weeks after 10 years at the firm. Stern, who was a partner and managing director, has since relocated to his hometown of Montreal. His plans for the fund are in the preliminary stages, a source said, adding that it’s unlikely to start trading before the first quarter of 2021 at the earliest. Stern has yet to finalize a name for the firm. Indications are that he would take an event-driven approach to trade across equity and debt. The strategy is likely to entail distressed plays on the credit side, with a portion of equity holdings coming in the form of activist stakes. Stern has taken a public-facing role in several of Fir Tree’s high-profile activist campaigns over the years. He helped lead the manager’s campaign seeking a board shakeup and share buyback at JR Kyushu, one of Japan’s largest rail operators. Fir Tree has continued to make progress on that campaign since Stern left.
Hedge Fund Urges Neiman Board to Consider Deal With Saks (The Wall Street Journal)
Jason Mudrick’s hedge fund is asking Neiman Marcus Group Ltd.’s board to consider “testing the waters” of a sale of the luxury department store chain to Saks Fifth Avenue, according to a letter viewed by The Wall Street Journal. A lawyer for Mudrick Capital Management LP, which owns $155 million of Neiman’s loans, said in a letter to the board that combining its business with that of Saks could create $2.8 billion to $4.7 billion of value.
David Tepper Says this is the Second-most Overvalued Stock Market He’s Ever Seen, Behind Only ’99 (CNBC)
Billionaire hedge fund investor David Tepper told CNBC on Wednesday the stock market is one of the most overpriced he’s ever seen, only behind 1999. His comments sent stocks to a session low. He also said some Big Tech stocks like Amazon, Facebook and Alphabet may be “fully valued.” Before Wednesday’s sell-off, it was “maybe the second-most overvalued stock market I’ve ever seen,” Tepper said on CNBC’s “Halftime Report.” “I would say ’99 was more overvalued.” “The market is pretty high and the Fed has put a lot of money in here,” the founder of Appaloosa Management said. “There’s been different misallocation of capital in the markets. Certainly you are seeing pockets of that now in the stock market. The market is by anybody’s standard pretty full.”
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Hedge Fund That Never Loses Bets Big on South Africa (Bloomberg)
A London-based hedge fund that has made gains every year since it was founded, through risky bets including Ukrainian GDP warrants and sanctioned Russian bonds, is now putting its money on South Africa. ProMeritum Investment Management LLP has allocated a fifth of its money — its biggest single holding — to South African government bonds, among the worst performers in emerging markets this year. It’s betting on a 15% rally in the next three to six months in response to the South African Reserve Bank’s aggressive policy easing and bond-buying in the secondary market. ProMeritum manages $320 million, and handed investors a 9.6% return last year.
Bill Ackman Turned a $27 million Bet into $2.6 billion in a Genius Investment. Here are 12 of the Best Trades of All Time. (Business Insider)
Pershing Square Capital‘s CEO Bill Ackman made headlines last month after making $2.6 billion for his hedge fund off a wise, yet controversial bet that the coronavirus would crash the stock market. With stock markets going into free-fall during the economic downturn, Ackman was one among a handful who landed massive profits by using credit protection on investment-grade and high-yield bond indexes. Ackman’s was the latest in a long line of renowned risky but wildly successful bets on the markets. From George Soros‘ breaking of the Bank of England in 1992, to Michael Burry‘s now world-famous Big Short during the financial crisis, Markets Insider decided to round up some of the best trades of all time.
Golub Capital Raises $3bn of Dry Powder for New Investments (Opalesque.com)
US-based asset manager Golub Capital announced that it has raised $3 billion of new investment firepower in the past six weeks. According to a press release from the direct lender and credit asset manager, its fundraising success includes closings since April 1st for Golub Capital Partners 12, L.P.; Golub Capital Partners International 12, L.P.; GEMS Fund 5, L.P.; GEMS Fund 5 International, L.P.; and Golub Capital BDC 3, Inc. “Golub Capital has already put some of its fresh capital to work and continues to actively engage on new lending opportunities,” said the release.
Havsfrun Divests Hedge Fund Portfolio (Hedge Nordic)
Stockholm (HedgeNordic) – Publicly-listed investment firm Havsfrun Investment AB, which has been managing a globally diversified multi-strategy portfolio of carefully-selected hedge funds, mutual funds and equities, is offloading its hedge fund portfolio and looks to deploy its capital into new investment opportunities. The Stockholm-based firm sent out redemption requests for about 85 percent of all remaining hedge fund investments. According to a press release, “the divestments will take place during the second and third quarters of the year, which will mean that Havsfrun Investment will be close to fully liquid.” Havsfrun has managed a diversified portfolio mostly comprised of hedge funds since 2010, but decided to broaden its investment universe in response to low expected returns from the hedge fund industry.
Druckenmiller Calls V-Shaped Recovery a Fantasy on Webcast (Bloomberg)
Stan Druckenmiller says the risk-reward calculation for equities is the worst he’s seen in his career. The legendary hedge fund manager spoke during a webcast Tuesday, saying the prospect of a V-shaped recovery in the U.S. is a fantasy. Bloomberg’s Dani Burger reports on “Bloomberg Daybreak: Europe.” (Source: Bloomberg)
Crypto Hedge Fund Tyr Capital Ends First Year with Strong Double Digit Returns (Hedge Week)
Tyr Capital Arbitrage SP (Tyr Capital), a crypto hedge fund for institutional investors, family offices and high net-worth individuals, has announced strong double digit returns for investors in its first year results. At a time when the repercussions of CovidD-19 are taking a heavy toll on both stock markets and the hedge fund industry, Tyr Capital has started 2020 with a performance of +11 per cent as of the 30 April, beating benchmark comparators[1] by significant margin during extreme volatility. Annualised Sharpe ratio was above 4. Tyr Capital Arbitrage SP was launched in January 2019 by Nick Norris, Ed Hindi and Nick Metzidakis. They met at Oak Capital, the London-based trading firm focused on soft commodity and energy markets, where Norris was COO, Hindi was Partner and CIO, and Metzidakis was Head of Quantitative Trading. Prior to that, Norris and Hindi traded together at Geneva Trading LLC and Hartree Partners LP.
Wednesday 5/13 Insider Buying Report: MCY, TCDA (Nasdaq.com)
At Mercury General, a filing with the SEC revealed that on Friday, Chairman of the Board George Joseph bought 29,883 shares of MCY, for a cost of $35.59 each, for a total investment of $1.06M. Joseph was up about 3.1% on the buy at the high point of today’s trading session, with MCY trading as high as $36.71 at last check today. Mercury General is trading off about 1.5% on the day Wednesday. Before this latest buy, Joseph made one other buy in the past twelve months, purchasing $2.94M shares at a cost of $38.93 a piece. And on Tuesday, Chief Financial Officer and EVP Geoffrey M. Parker bought $1.05M worth of Tricida, buying 35,000 shares at a cost of $30.09 a piece. Before this latest buy, Parker bought TCDA on 3 other occasions during the past year, for a total investment of $1.80M at an average of $32.79 per share. Tricida is trading down about 1.3% on the day Wednesday.
Broadridge Financial Solutions Inc (BR) Corporate SVP and CFO James M Young Sold $11.7 million of Shares (Guru Focus)
Corporate SVP and CFO of Broadridge Financial Solutions Inc., James M Young, sold 98,336 shares of BR on 05/12/2020 at an average price of $119.46 a share. The total sale was $11.7 million. Broadridge Financial Solutions Inc provides investor communications & technology-driven solutions to banks, broker-dealers and corporate issuers. Its services include investor & customer communications, securities processing & data & analytics solutions.
The Chairman and Acting President of Harley-Davidson (NYSE: HOG) is Buying Shares (Analyst Ratings)
Yesterday, the Chairman and Acting President of Harley-Davidson (HOG), Jochen Zeitz, bought shares of HOG for $2.08M. This recent transaction increases Jochen Zeitz’s holding in the company by 100% to a total of $2 million. This is Zeitz’s first Buy trade following 4 Sell transactions.
Only Fourteen Dow Components With Recent Insider Buying, XOM Is One Of Them (Forbes)
The officers and directors of a company tend to have a unique inside view into the business, so when these insiders make purchases, investors are wise to take notice. Presumably the only reason for a company insider to choose to take their hard-earned cash and use it to buy stock in the open market, is that they expect to make money — maybe they find the stock very undervalued, or maybe they see exciting progress within the company, or maybe both. Within the 30 components of the Dow Jones Industrial Average, only fourteen companies have experienced such buying over the trailing six month period, one of which was Exxon Mobil, where an investment totaling $1.1M was made by Vice President Neil W. Duffin. Duffin’s average cost works out to $36.41/share.
Morgan Stanley Smith Barney Charged With Providing Misleading Information to Retail Clients (HedgeCo.net)
(HedgeCo.Net) Morgan Stanley Smith Barney LLC (MSSB) has agreed to settle charges that it provided misleading information to clients in its retail wrap fee programs regarding trade execution services and transaction costs. MSSB has agreed to pay a $5 million penalty that will be distributed to harmed investors. Wrap fee programs offer accounts in which clients pay an asset-based “wrap fee” that covers investment advice and brokerage services, including trade execution. According to the SEC’s order, MSSB marketed its wrap fee accounts as offering clients professional investment advice, trade execution, and other services within a “transparent” fee structure. From at least October 2012 until June 2017, some of MSSB’s marketing and client communications gave the impression that wrap fee clients were not likely to incur additional trade execution costs. During that period, however, the order finds that some MSSB managers routinely directed wrap fee clients’ trades to third-party broker-dealers for execution, which in some instances resulted in MSSB clients paying additional transaction fees that were not visible to them. As a result of MSSB’s conduct, the order finds that certain MSSB clients were unable to assess the value of the services received in exchange for the wrap fee paid to MSSB.
