One of the hottest trades of the past few months has been the bonds of a country so shaken by economic and social turmoil that a neo-Nazi party is running third in the polls. That’s right: Hedge funds have been buying Greece. Ever since Greece completed a debt restructuring in March that turned €200 billion in bonds into about €60 billion, distressed-debt investors—many at U.S. hedge funds—have been picking them over. Hedge-fund analysts have flooded Greek finance officials with requests for information. Prices have climbed. Third Point LLC, based in New York, crowed about Greece in its investor letter earlier …
Hedge Funder Phil Falcone And His Wife Lisa Have An Amazing House Of Horrors (BusinessInsider)
Billionaire hedge fund manager Phil Falcone, the founder of Harbinger Capital, and his wife Lisa Maria, have turned their Upper East Side palatial home into an incredible house of horrors. The Falcones bought the 27-room mansion, which is just steps away from Central Park, for $49 million in 2008, according to a Bloomberg News report. We ran in to Lisa Maria, who is the mother of twin daughters, while she was decorating the building’s exterior on Monday afternoon.
Vikram Pandit to make a comeback in hedge fund market? (TheFinancePages)
Vikram Pandit, the ex-CEO of Citigroup, is likely to come back to the hedge-fund field, as Portman Square Capital’s founder Sutesh Sharma is vying to hire him for his firm. Sharma launched hedge fund firm Portman Square Capital this year with $500 million. Sutesh Sharma was a money manager at Vikram Pandit’s now defunct Old Lane hedge fund, which Vikram Pandit established in March 2006 along with John Havens. Vikram Pandit and John Havens joined Citigroup in 2007 when Citigroup bought the company for $800 million. Vikram Pandit was appointed as the new CEO of Citigroup on December 11, 2007, with the backing of the then interim chairman of Citigroup Robert Rubin.
Annual Hedge Fund Compensation Benchmark Survey Now Open (Equities)
The sixth annual Hedge Fund Compensation Survey, conducted by Job Search Digest, publishers of Hedge Funds Jobs Digest is now underway and seeks to unveil trends and changes in hedge fund pay practices. The Hedge Fund Compensation Survey is crafted to collect data directly from those that work every day in the Hedge Fund industry and create an accurate and affordable compensation benchmark tool that can be used by individuals evaluating their own compensation package as well as by firms seeking to implement fair compensation policies. The online survey takes less than 10 minutes to complete and eligible participants who complete the survey receive the final 2013 Hedge Fund Compensation Report (a $397.00 value) free of charge as a thank you for their participation.
The rich bail out of changing hedge fund industry (Reuters)
Rich private investors are turning their backs on hedge funds because moves to attract more conservative pension fund clients mean managers no longer deliver the big returns they crave. The fastest growing source of new money for hedge funds is now pension funds and insurance companies who want managers to go easy on risky trades. Funds are finding it hard to say no to the big money these investors offer so rich clients are feeling neglected.
Big donor also has ties to Robinson’s institute (RegisterGuard)
Wealthy New York hedge fund manager Robert Mercer is playing a big part in Art Robinson’s congressional campaign, pouring nearly a quarter of a million dollars into a political action committee that’s backing Robinson’s bid against incumbent Democrat Peter DeFazio in the 4th Congressional District. But that’s not Mercer’s only financial role in helping Robinson. Mercer is also a longtime contributor to Robinson’s nonprofit Oregon Institute for Science and Medicine, which pays Robinson a $100,000 annual salary, public records show.
Ex-Credit Suisse trader says Asia hedge fund returns 60% (TheSunDaily)
Charlie Chan’s Splendid Asia macro hedge fund is living up to its name, with the former Credit Suisse trader putting his returns at 60% this year as bets on real estate investment trusts (REIT), bonds and currencies pay off. It’s on a different scale to his previous role at the Swiss bank, where Chan’s 25-year-plus career culminated in him heading a team running portfolios of over US$10 billion. For Splendid Asia, 53-year-old Chan is managing a relatively small US$80 million, about half of which is his own money. The Singaporean is one of many traders leaving investment banks to set up hedge funds, as US regulators seek to ban banks from trading their own money and weak markets have banks looking to trim operations.
SAC adds to property cat team (Trading-Risk)
Hedge fund-backed start-up SAC Re has hired Tim Duffin from Bermudian reinsurer Platinum Underwriters to be the firm’s deputy property cat underwriter alongside Kathleen Reardon, Trading Risk understands. Reardon’s appointment as chief underwriting officer for property was first announced in July and she will join the firm next week. Duffin will join the firm in November. Reardon was most recently international chief underwriting officer at Ace Tempest Re Bermuda since late 2005 and before that, vice president underwriting for Ace…
Simon Lack: mediocre hedge fund performance nothing new (Opalesque)
Simon Lack is a veteran of the hedge fund industry. After 23 years at JP Morgan, Lack went on to found SL Capital Advisors a firm which provides separately managed accounts to investors with an interested in master limited partnerships; high dividend yielding stocks – hedged and unhedged, and a deep value equity strategy. Lack, also recently authored a book – The Hedge Fund Mirage, which he spoke about with Matthias Knab for Opalesque TV. In the book, Lack writes that while there are many happy hedge fund investors, “on average, a dollar invested in hedge funds would have been better off invested in treasury bills.” He explains that has hedge funds attract more assets, like they did throughout the 1990s, returns actually become worse.
Farallon Capital’s Founder to Step Down This Year (NYTimes)
Another one of the world’s biggest hedge funds is preparing for life beyond its founder. Farallon Capital Management announced on Monday that its senior managing member, Thomas F. Steyer, would leave the firm at the end of the year. Mr. Steyer, who managed a $20 billion investment firm, is part of a group of hedge fund executives who have started firms from scratch and built large-scale global operations with billions of dollars under management. They now wield influence over Wall Street and the global economy. As they have grown older — and ever richer — they are passing the baton to successors.
Prosecutors Seek to Exclude Recordings From ‘Criminal Club’ Case (WSJ)
Federal prosecutors asked a judge Monday to exclude several recorded phone calls two former hedge-fund managers hope to offer in their defense in an insider-trading trial scheduled to begin next week over an alleged scheme prosecutors have labeled a “criminal club.” Todd Newman, a former portfolio manager with hedge-fund firm Diamondback Capital Management, and Anthony Chiasson, a former hedge-fund manager at Level Global Investors, were allegedly part of a circle in which fund employees regularly shared and traded on inside information about technology companies, prosecutors said.
Bond Veterans Ready $250M Credit Hedge Fund (Finalternatives)
A pair of banking veterans will ring in the new year with a new high-yield hedge fund. K.C. Baer and Christopher Yanney, who have worked together on-and-off for the past 15 years at NationsBank, Bank of America and Citigroup Inc. (NYSE:C), and who both at one time led U.S. high-yield trading at Barclays, founded CKC Capital in New York. The two hope to raise $250 million for a January launch, Bloomberg News reports. “It was a good opportunity for us, timing-wise, and something we always wanted to do,” Baer told Bloomberg. “We have been through several market cycles together, which we think is a benefit.”
Ex-Deutsche Bank executive resurfaces at hedge fund (eFinancialNews)
Ben Sofoluwe, who was also a managing director at Deutsche Bank and left earlier this year, has joined EQI Asset Management. Steve Smith, head of trading at EQI, confirmed that Sofoluwe started in his role on Monday. Sofoluwe declined to comment. Sofoluwe has been hired to help establish EQI’s securities lending business, which includes both the borrowing and lending of stocks. Smith said: “Sofoluwe will further establish and develop EQI’s securities lending business as we continue to increase assets under management, having had three successful years.”
Stenham cools on Asia hedge funds (eFinancialNews)
The Stenham Emerging Markets fund – the UK manager’s first fund of long-only funds – launched last month with $15m of seed capital. The fund will invest in a portfolio of eight-to-10 managers of long-only equity strategies. It gained 1.55% in its first month. Kevin Arenson, chief investment officer at Stenham, which runs $2.4bn, said that its Asian managers in the new fund typically charge a flat management fee of about 75 basis points and no performance fee.
FABER: CUT THE US GOVERNMENT BY 50% NOW! (SFLuxe)
The debt burden in the U.S. and other Western countries will continue to increase, Marc Faber , author of the Gloom, Boom and Doom report told CNBC on Monday, leading to a “colossal mess” within the next five to 10 years. “I think the regimes will try to keep the system alive as it is for as long as possible, which means there’s no “fiscal cliff,” there’s a fiscal grand canyon,” Faber told CNBC’s “Squawk Box.” Faber argued that the political systems in place in the West would allow the debt burden to continue to expand. Under such a scenario of never-ending deficits, the Western world would rack up huge deficits…
Corruption another worry in this election? (Standard)
“No matter who people vote for, they always vote for us.” “People who vote, count for nothing; people who count votes, count for everything” – Joseph Goebbels. The Nazi propaganda minister was mentored by Edward Bernays, the father of public relations whose main function is to tell lies often enough that people believe them. Mitt’s father George Romney was also mentored by Bernays. Scytl, a foreign private equity firm will count the U.S. votes from Barcelona; George Soros and Mitt Romney’s Bain Capital are principal owners and managers of Scytl. Electronic votes will be cast using e-Slate and e-book in swing states such as Texas, Ohio, Colorado and Florida. The votes will be tallied by previous employees of Bain Capital now managers at HIG Capital, the owner of Hart Intercivic, the maker of the e-voting machines.
SEC Adopts Standards for Risk Management and Operations of Clearing Agencies (SEC)
The Securities and Exchange Commission today adopted a rule that establishes standards for how registered clearing agencies should manage their risks and run their operations. Clearing agencies generally act as middlemen to the parties in a securities transaction. They play a critical role in the securities markets by ensuring that transactions settle on time and on the agreed-upon terms. The rule was adopted in accordance with the Securities Exchange Act of 1934 and the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Dodd Frank Act provides the SEC with additional authority to establish standards for clearing agencies, including for those clearing agencies that clear security-based swaps.
Trader Drops Wall Street, Writes Thriller About Bank Scam (Bloomberg)
“Not all sales managers are bottom- feeding lowlifes,” writes Michael Sears in his Wall Street thriller, “Black Fridays.” “The politicians are the ones who last — the two-fisted hand-shakers, the ass-kissers, the promise-breakers, the glory- hounds, the self-promoters.” Sears should know. After a stint as an actor, he spent two decades in the bond business. Now, at 62, he’s published his first novel, starring former hotshot Jason Stafford, who was sent to prison for “accounting irregularities.” After serving his two-year term, Stafford starts a new career as an investigator for an investment firm.
Rosneft beefs up with TNK-BP purchase (Reuters)
Rosneft (ROSN.MM) tightened its grip on Russia’s oil industry on Monday with a $55 billion deal to buy TNK-BP that also makes BP plc (LON:BP) a one-fifth shareholder in the state-controlled company. …”TNK-BP has been an industry leader in terms of return-on-capital-invested and dividends and as a result was consistently the leader in terms of shareholder capital creation,” said Steven Dashevsky, founder and chief investment officer at hedge fund Dashevsky & Partners.
Fitch rates Spectrum’s term loans and note ‘BB-‘ (Reuters)
Spectrum Brands Holdings, Inc. (NYSE:SPB) will be issuing $1.840 billion in new debt primarily to finance the acquisition of Stanley Black & Decker’s Hardware & Home Improvement Group (HHI) which was announced on Oct. 9, 2012. The acquisition’s price is approximately $1.4 billion (7.4x June 30, 2012 LTM EBITDA). The $1.840 billion in proceeds will be used to pay approximately $1.4 billion for the HHI acquisition, repay $370 million in existing term loans with the remainder for related fees and expenses.
Ohio Public Employees places $280 million in 2 hedge funds (PIOnline)
Ohio Public Employees’ Retirement System, Columbus, made two direct hedge fund investments totaling $280 million, confirmed spokesman Michael Pramik. The $76.4 billion pension fund committed $180 million to Bridgewater Pure Alpha Major Markets, a discretionary global macro fund, and $100 million to Visium Balanced Fund, an equity long/short fund. The commitments bring the pension fund’s total direct hedge fund investments to $2.7 billion. Hedge fund consultant Cliffwater assisted.
Casting Dual Roles, at Treasury and the Fed (NYTimes)
For the last couple of months, there has been a parlor game on Wall Street and in Washington about who will become the next Treasury secretary. After all, Timothy F. Geithner has made it clear he plans to be out of that office at the end of the year whether President Obama is re-elected or not. But there is another wrinkle in the parlor game calculus: Ben Bernanke, the Federal Reserve chairman, is likely to need a successor, too. If Mitt Romney wins the presidency, he has already pledged he will replace Mr. Bernanke, whose term as chairman ends in January 2014, in just over 15 months. However, Mr. Bernanke has told close friends that even if Mr. Obama wins, he probably will not stand for re-election.
