Bankruptcy Trustee Says Fletcher Investments Inflated Through Fraud (WSJ)
In a prospectus to investors, hedge-fund manager Alphonse Fletcher Jr. said he planned to achieve returns by doing deals “immediately, quantifiably worth more to the buyer than the seller.” But a court-appointed bankruptcy trustee said in a report this week that the values Mr. Fletcher placed on investments were inflated through fraud, and that his firm’s funds were likely insolvent as far back as December 2008. In the report, the trustee, Richard J. Davis, said that a network of related Fletcher hedge funds had not made a profitable investment after August 2007.
International Investor Touts Agriculture (AGWeb)
“If farmers aren’t rich yet, they will be,” predicts investor and business author Jim Rogers. “The stockbrokers are going to be the ones driving taxis in the future, and the farmers are going to be the ones driving Lamborghinis.” Individuals who can retire before they reach 40 are as rare as Olympic athletes. Jim Rogers, who was raised in Alabama and now lives in Singapore, is one of those rare individuals. As co-founder of the Quantum Fund, a global investment partnership, his career was highlighted by strong portfolio gains and smart investments.
Hedge funds play buy-and-hold, and lose (CNBC)
Hedge fund managers are riding their stock picks as long as possible, but overall returns continue to lag the market, according to a new report from Goldman Sachs Group, Inc. (NYSE:GS). The bank’s 783 hedge fund clients turned over—sold a position before holding it for a year—just 28 percent of their portfolios, according to the report. The 12-year turnover average is 35 percent. The turnover of funds’ largest holdings also fell to an all-time low of 15 percent. And the average fund holds 63 percent of long assets in just 10 top positions, In other words, top hedge fund managers believe their best ideas will continue to gain as the bull market hits new highs.
Investor activists undermine credibility with ‘greenmail’ (TheGlobeAndMail)
Activist investors assert that their cage-rattling of corporations benefits all shareholders, not just themselves. There’s some truth to this. It’s a reason they’ve been able to exert pressure on ever larger companies with relatively small investments. But selectively taking the money and running dilutes their argument. …Some of the more successful activists are able to bring along large swaths of a company’s owners to their causes. Bluster aside, an uppity fund manager like Carl Icahn or Dan Loeb can galvanize a decent minority of shareholders with stakes of as little as a few percentage points. That has allowed them to take on larger targets than just a few years ago, such as Sony Corporation (ADR) (NYSE:SNE) or Apple Inc. (NASDAQ:AAPL).
Nouriel Roubini Just Identified A Ton Of Housing Markets That Look Like Bubbles To Him (BusinessInsider)
Economist Nouriel Roubini is sounding a big warning about global housing bubbles. In a new piece for Project Syndicate, he identifies at least 17: Now, five years later, signs of frothiness, if not outright bubbles, are reappearing in housing markets in Switzerland, Sweden, Norway, Finland, France, Germany, Canada, Australia, New Zealand, and, back for an encore, the UK (well, London). In emerging markets, bubbles are appearing in Hong Kong, Singapore, China, and Israel, and in major urban centres in Turkey, India, Indonesia, and Brazil.
Dell Appraisals Demanded by T. Rowe to Magnetar Capital (Bloomberg)
T. Rowe Price Group, Inc. (NASDAQ:TROW) and more than 100 other Dell Inc. (NASDAQ:DELL) shareholders who control a combined 47.5 million shares spurned the company’s buyout offer to seek a potentially higher payout through the Delaware court system. T. Rowe intends to pursue appraisal rights on about 30 million shares held in mutual funds and client accounts overseen by the Baltimore-based firm, according to a Nov. 25 legal filing by Dell. Other shareholders who said they plan to request an independent valuation by the Delaware Chancery Court include Magnetar Capital LLC, an Evanston, Illinois-based hedge-fund firm run by Alec Litowitz; the New York State Common Retirement Fund; and New York-based Loeb King Capital Management.
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