Editor’s Note: Herbalife Ltd. (NYSE:HLF), Whole Foods Market, Inc. (NASDAQ:WFM), Delta Air Lines, Inc. (NYSE:DAL), J.C. Penney Company, Inc. (NYSE:JCP)
Karsch Returns Client Capital in $1.8 Billion Hedge Fund (Bloomberg)
Michael Karsch is returning client money in his $1.8 billion hedge-fund firm after 13 years, saying he wants to take time to contemplate the next stage of his career, according to a letter sent to investors. Karsch, 45, plans to return 95 percent of client assets in New York-based Karsch Capital Management LP by Sept. 30 and the remainder no later than January, according to the letter, a copy of which was seen by Bloomberg News.
Hedge Funds And Insiders Are Buying These 5 Stocks (Seeking Alpha)
According to economic theory, company insiders are incentivized against buying stock as it increases their company-specific risk. Therefore, in theory, observing purchases should mean that these insiders are confident enough in the business’s prospects to overcome this factor; in fact, studies do generally show an outperformance effect for stocks bought by insiders, particularly if multiple insiders have been buying. Multiple insiders have been buying Delta Air Lines, Inc. (NYSE:DAL), including one purchase which came after federal regulators’ recent decision to challenge the merger of US Airways and American Airlines (markets, which had expected the deal to increase industry consolidation, sent airline stocks generally down on the news). Billionaire David Tepper‘s Appaloosa Management has been bullish on the industry, and owned over 10 million shares of Delta in its most recent filing.
Whole Foods Market, Inc. (WFM): 4 Reasons Hedge Fund Billionaires Are Wrong About 62% Gain (iStockAnalyst)
In 13-F filings from the second quarter, Insider Monkey reveals that Whole Foods Market, Inc. (NASDAQ:WFM) is falling out of favor with Hedge Funds, held in 39 funds in the first quarter but just 25 in the second quarter. That hedge fund exodus from Whole Foods has been driven by shares jumping 62% in the last 2 years, pushing Whole Foods Market, Inc. (NASDAQ:WFM) valuation to a 4-year high. But even though I’m a big fan of following hedge funds, in this case I believe the smartest money on the street is wrong.
In N.Y. Mayoral Race, Small Checks From Hedge Fund Giants (New York Times)
Hedge fund titans are making a $170,336 bet that Christine C. Quinn is the best candidate to run New York. Ms. Quinn, a Democrat and the City Council speaker, has received that amount in donations from the hedge fund industry. Paltry though the sum seems, it is more than twice the amount received by the next closest recipient in the mayoral race, Joseph J. Lhota, a Republican, according to records compiled by the public affairs lobbying organization Common Cause.
Seggerman Pleads Guilty to Conspiracy in Tax Evasion Case (Bloomberg)
Henry Seggerman, accused with other family members of hiding from federal authorities millions of dollars in his father’s estate, pleaded guilty in Manhattan federal court to conspiracy and tax crimes. The U.S. claimed Seggerman’s father, Harry G.A. Seggerman, a New York businessman who died in 2001, left a $24 million estate, more than half of which was held in undeclared Swiss accounts. Henry Seggerman, 60, is listed on the website of his father’s hedge fund management firm, International Investment Advisors LLC, as the chief investment officer.
SEC Probes Soros About Herbalife Purchase (HLF) (Dividend.com)
It was reported on Wednesday that an SEC lawyer had started digging into Bill Ackman’s claims that Herbalife Ltd. (NYSE:HLF) shares have been manipulated by other hedge funds, namely Soros Fund Management. Liora Sukhatme, SEC enforcement lawyer, recently spoke with Bill Keep, the dean at the College of New Jersey who is also an expert on pyramid schemes. This investigation is a result of Bill Ackman’s accusations against Soros Fund Management for tipping off other hedge funds about the fund’s long position in Herbalife shares; Ackman has voiced his concerns surrounding the company, calling it a scam, and also disclosed his short position.
Bond-King Pimco Plans to Push ‘Alternative Funds’ (Wall Street Journal)
Pacific Investment Management Co., the world’s largest bond-fund manager by assets, wants to hang more with the hedge-fund crowd. The firm, based in Newport Beach, Calif., is planning an expansion of its alternative-investments business in the coming months aimed at both individual and institutional clients, including potentially launching new funds invested in assets such as distressed debt in Europe. Douglas Hodge, Pimco’s chief operating officer, called alternative investments “a very important area for us” in an interview with The Wall Street Journal. He said the firm is responding to increased demand from investors of all types, as well as to changing regulations.
Investcorp brings in hedge fund principal (Pensions & Investments)
Elena Ranguelova joined Investcorp’s hedge fund unit as principal and head of credit and equity strategies. Ms. Ranguelova’s position is new and brings with it oversight of the firm’s investments in emerging managers’ hedge funds and in its seeding activities with individual managers, confirmed James Cheston, an Investcorp spokesman, in an e-mail. Ms. Ranguelova was global head of credit and event-driven strategy research at Pioneer Investments.
Hedge Funds Emerge From The Bunker (Wall Street Journal)
While many investors have been running away from emerging markets, one set of money managers is seeing opportunity: hedge funds. Hedge fund assets invested in emerging markets jumped 25% year-on-year to hit a new record in the June quarter, according to Hedge Fund Research. In contrast, many emerging-markets investors have lost their nerve since late May as taper talk around the Federal Reserve has grown and now Syria has moved into sharper focus.
FRANKLIN TEMPLETON LAUNCHES HEDGED GLOBAL BOND FUND (Advisor.ca)
Franklin Templeton has announced the launch of a hedged global bond fund, which was designed for investors who want to mitigate the effects of currency fluctuations on their portfolios. This new fund is a version of the Templeton Global Bond Fund, and the new offering is available as an alternative to the Templeton Global Bond Hedged Yield Class. Recently, the hedged class was closed to new investments due to the 2013 federal budget’s measures affecting character conversion transactions.
Hedge Funds Still Holding Big Penney’s Horde (FINalternatives)
J.C. Penney Company, Inc. (NYSE:JCP) may have rid itself of its most turbulent hedge fund shareholder—Pershing Square Capital Management’s William Ackman—but it has others that could take his place should its turnaround founder. There are more than a dozen hedge funds among Penney’s 100 largest shareholders. None has anywhere near the stake—more than 18%—that Pershing Square owned, and none will, given the company’s new poison pill. But together, they make up some formidable numbers. Soros Fund Management owns a 9.1% stake and Perry Capital a 7.3% stake, The New York Times reports. Glenview Capital Management owns 3.8% of the troubled retailer. Others on the roster include Balyasny Asset Management, Citadel Investment Group, SAC Capital Advisors and Wexford Capital.
