Citadel’s Griffin Defends HFT (FINalternatives)
Citadel Investment Group founder Kenneth Griffin yesterday urged Congress not to ban high-frequency trading, but to focus on regulations that would improve market stability. Speaking at a Senate Banking Committee hearing, Griffin, whose firm does some high-frequency trading, albeit less than in previous years, said that Congress should “absolutely not” ban the practice. He called the U.S. equity markets “the fairest, most transparent, resilient and competitive” in the world, and said that HFT helps reduce market inefficiencies.
Tudor Said to Hire Morgan Stanley Inflation Strategist Wilding (Bloomberg)
Tudor Investment Corp., the $13 billion hedge fund run by Paul Tudor Jones, hired Morgan Stanley (NYSE:MS) strategist Tiffany Wilding, according to a person familiar with the matter, as investment firms recruit from Wall Street anticipating central banks will soon start raising interest rates. Wilding, 29, who specialized in Treasury Inflation Protected Securities, or TIPS, at Morgan Stanley, joined Tudor this week as a strategist, said the person, who asked not to be named because the information is private. Prior to joining Morgan Stanley in 2011, she worked at the Federal Reserve Bank of New York.
Two Executives and A Hedge Fund Portfolio Manager Sentenced To Federal Prison (HedgeCo.net)
Eric M. Martin, Mark Megalli, and Richard T. Posey have been sentenced to federal prison for their roles in a multi-million-dollar insider trading conspiracy involving childrens clothing company Carter’s, Inc. (NYSE:CRI) stock. Mark Megalli worked at New York hedge fund Level Global Investors was the contact point for some of the insider trading, the FBI says. Megalli in turn caused Level Global to execute multimillion dollar trades in Carter’s stocks based on the inside information received from Martin from September 2009 through July 2010. The former-Carter’s executives also tipped off others including NJ hedge fund Titan Capital Management LLC.
Smart Biotech Hedge Fund Worth Watching Had Therapeutics MD Before Pop (Forbes)
Biotech stock Therapeutics MD (TXMD) was up 32.5% on Tuesday, lifted by brokerage house FBR Capital initiating coverage with an incredible $34 price target. Based on TXMD’s Tuesday closing price of $5.47, the FBR price target would mean a 600% return. TXMD is owned by the billion-dollar biotech hedge fund RA Capital Management. RA is experienced in the business of biotech investing, and owns more than 6% of TXMD.
Allergan Planning Cost Cuts Amid Valeant Defense (Bloomberg)
Allergan, Inc. (NYSE:AGN), the Botox maker being pursued by Valeant Pharmaceuticals Intl Inc (NYSE:VRX) and Bill Ackman’s hedge fund, will shelve unpromising pipeline drugs and overhaul management incentives, two people with knowledge of the matter said. A broad restructuring plan set to be outlined during Allergan’s earnings announcement later this month will also involve companywide cost cuts, including some legacy expenses, said the people, who asked not to be identified because the effort isn’t yet public. Management compensation will be more closely tied to achieving higher forecasts.
Opportunities for profit in hardest of times (CNBC.com)
American Apparel to Get $25 Million in Financing From Hedge Fund (Wall Street Journal)
American Apparel Inc. has reached a preliminary agreement to get $25 million in financing from hedge fund Standard General in a deal aimed at shoring up the company’s finances and reconstituting its board, a person familiar with the matter said. Standard General effectively controls more than 40% of the company’s shares through an arrangement it reached last month with Dov Charney, American Apparel’s ousted founder and chief executive. It had warned it would consider launching a proxy fight to win board seats if an agreement wasn’t reached. The deal gives American Apparel funds to repay a $10 million loan from Lion Capital, another investment firm, which formally demanded repayment Monday.
HFRI: Hedge Funds Up 3.2% In First Half (FINalternatives)
Hedge funds continued to sputter in June, closing out the first half of the year far behind the broader markets, according to Hedge Fund Research. The HFRI Fund Weighted Composite Index added 1.31% last month to end the first half up 3.2%. By contrast, the Standard & Poor’s 500 Index is up more than 6% on the year. A handful of strategies tracked by the HFRI suite were able to top that. India-focused funds have soared 33.36% this year (5.49% in June), and energy and basic materials funds are up 11.36% (3.81%).
Carlyle Carry Fund Valuations Rise 5 Percent In Q2 (RTT News)
Private equity giant Carlyle Group L.P. said Monday that its preliminary carry fund valuations increased 5 percent during the second quarter of 2014. Carlyle’s carry funds are the investment funds that the company advises. These include the buyout funds, growth capital funds, real asset funds, infrastructure funds, certain energy funds, and distressed debt and mezzanine funds, where the company receives a special residual allocation of income. However, it excludes the company’s structured credit funds, hedge funds, fund of funds vehicles, and the NGP funds.
NY Jury Acquits Ex-Hedge Fund Founder’s Brother (TIME)
The brother of an imprisoned ex-billionaire hedge fund founder was acquitted of conspiracy on Tuesday. A Manhattan jury returned the verdict at the federal insider trading trial of Rengan Rajaratnam. The smiling defendant hugged his lawyers and relatives when the verdict was read. His brother, Raj Rajaratnam, is the founder of the Galleon Group of hedge funds and is serving an 11-year sentence for making up to $75 million illegally.
Hedge funds get USD16.9bn in May (HedgeWeek)
The hedge fund industry took in USD16.9 billion (0.7 per cent of assets) in May, down slightly from USD19.1 billion (0.8 per cent of assets) in April, according to TrimTabs and BarclayHedge. “Hedge funds raked in USD72.2 billion in the first five months of this year, the strongest January-May inflows since 2007,” says Sol Waksman, president and founder of BarclayHedge.
