Och-Ziff Profits Soar (Finalternatives)
Och-Ziff Capital Management’s strong hedge-fund returns helped it top analysts’ expectations in the fourth quarter. The publicly-listed hedge fund said its distributable earnings in the last three months of 2013 were $559 million, 59% better than the fourth quarter of 2012, when it earned $351.3 million. “Last year was an outstanding year for us, and demonstrated the strength of our firm globally,” firm founder Daniel Och said. “Last year was also reflective of the progress we made towards our strategic goal of becoming a global, multi-product, alternative asset manager…
Hedge Fund Trends: Mobile Commerce Retailing (HedgeCo)
Michael Zimmerman’s hedge fund Prentice Capital says that according to new December 2013 data, one-third of online shoppers now only use their mobile devices when shopping. Zimmerman, who has long held the view that retailers need strong branding and well-planned online & mobile shopping platforms thinks this will put even more pressure on retailers to build strong m-commerce sites and apps. Only two-thirds of indexed brands have mobile-optimized sites, and yet a full third of those don’t allow consumers to shop from those sites, New York research firm L2 noted. Many also fail to provide the full range of content available on their desktop sites, including product search and user ratings, to mobile audiences.
Mathew Martoma Insider Trading Conviction: Guilty (InsiderMonkey)
This was an obvious conviction. Mathew Martoma and Preet Bharara are both losers though. The winner is Steven A. Cohen. Federal prosecutors have been targeting Cohen for a very long time but they failed to flip Martoma. I am surprised that Martoma didn’t cut a deal with the prosecutors. This conviction doesn’t mean that Cohen’s strong track record is purely because of insider trading. Cohen will continue to generate strong alpha in the coming years. Since he doesn’t have to manage as much capital, his returns will probably go up. Steve Cohen’s investment strategy is very similar to what we do at Insider Monkey. Cohen takes the best ideas of fund managers in his company which is why he was able to deliver such strong returns.
The Hedge Fund Wizard Betting Big on Big Data Research (InsidePhilanthropy)
Jaffray Woodriff knows a thing or two about data. The investment whiz based in Charlottesville, Virginia, used his homegrown predictive models of investment data to build a $4 billion-plus managed futures firm. Paying tribute to his golden goose, the investor just made a $10 million gift to advance the emerging field of data science. Woodriff’s private foundation the Quantitive Foundation recently pledged the grant to his alma mater, The University of Virginia, to endow its new Data Science Institute, a cross-disciplinary center that will focus on interpreting meaning from and using the heaps of data drawn from arenas such as e-commerce, environmental monitoring, and finance. The university will also provide $7 million to the endowment.
Watson Wheatley win 2014 International Hedge Fund Award (BobsGuide)
It has been announced that Watson Wheatley Financial Systems, specialists in securities reconciliation, have won the Reconciliation & Data Aggregation award at the 2014 International Hedge Fund Awards. The International Hedge Fund Awards, sponsored by AI Global Media celebrate excellence within the emerging asset class, recognising the people, companies and firms who are successfully forming, managing and advising on hedge funds in the current market. WWFS managing director Duncan Wheatley remarked “We are extremely pleased to accept the award and feel that it reflects on our hard work during the last 12 months which has resulted in a number of new client wins, an upgraded reconciliation platform and much increased confidence for the coming year…
ACQ Closing Most Funds As Assets Fall Below $100M (Finalternatives)
Hedge fund Asian Century Quest Capital is shutting all but one of its hedge funds as its assets under management have dropped by 95% over the past two years. Among the casualties is the New York-based firm’s long/short equity fund. Only ACQ’s long-only Equity Income Fund will survive, according to CNBC. ACQ managed $1.74 billion in 2012, but is down to less than $100 million after a period of sub-par performance. ACQ’s flagship rose just 5.5% last year, about half the return of the Dow Jones Asia/Pacific Total Stock Market Index.
Who is Mathew Martoma really? (CNBC)
The cost of investing in alternative assets is falling—slowly (Economist)
PHOENICIAN merchants kept a fifth of the profits generated from their seafaring adventures and paid out the rest to their financiers. So claimed Alfred Winslow Jones, the manager of the first modern hedge fund, who in the 1950s used the (perhaps apocryphal) precedent to finagle a 20% cut from his backers. Other managers subsequently added a 2% annual charge on the assets they invested to arrive at the “2 and 20” formula that became the standard for both hedge funds and private equity. Investors, who have long suspected that this arrangement enriches managers faster than their clients, are belatedly fighting back. They have succeeded in amending the formula to something more like “1.4 and 17”, at least for newcomers to the business (see chart).
Raimondo’s Money Moves Criticized By Wall Street Journal (RIPR)
The hedge fund Third Point LLC offered a 25 percent return to Rhode Island’s pension fund over the last year. That’s far better than the 14 percent earned by the pension fund as a whole. Yet the state Investment Commission, which is chaired by Raimondo, voted last week to divest its holdings in Third Point. In an editorial, The Wall Street Journal says the move amounts to a buckling under by Raimondo due to pressure from a teachers’ union. The editorial points to how the American Federation of Teachers opposes charter schools, and how the hedge fund’s owner is a big charter school supporter. Raimondo’s spokeswoman, Joy Fox, says the move was routine, to reduce risk in the pension fund’s hedge fund allocation.
Federal-Mogul replaces co-CEO with Icahn executive (AutoNews)
Federal-Mogul Corp (NASDAQ:FDML) said one of its co-CEOs is stepping down to be replaced by a board member and executive affiliated with its controller shareholder — longtime Wall Street player Carl Icahn. The diversified powertrain and spare parts supplier named Icahn executive Daniel Ninivaggi to co-CEO and CEO of its aftermarket group. He replaces Kevin Freeland in the position; Freeland is leaving the company for personal reasons, the company said in a statement. Freeland was hired in the role in May. Ninivaggi is the third executive in the position in less than two years. Rainer Jueckstock continues as the other co-CEO.
Hedge funds down in January… Global ETFs overtake hedge funds… (HedgeWeek)
Hedge funds fell 0.24 per cent to open 2014 – but not as much as the broader markets. The average hedge fund shed 0.24 per cent in January, according to Hedge Fund Research’s HFRX Global Hedge Fund Index. But the benchmark managed something it rarely accomplished last year: besting the Standard & Poor’s 500 Index, which fell more than 3 per cent last month. Despite the overall decline, most strategies tracked by the HFRX suite were in the black in January, led by master-limited partnerships—last year’s best-performing strategy at 26.35 per cent which returned 1.58 per cent. Distressed restructuring funds gained 1.08 per cent, equity-market neutral funds 0.72 per cent, convertible arbitrage funds 0.64 per cent, credit funds 0.6 per cent, event-driven funds 0.39 per cent, fundamental growth funds 0.36 per cent, systematic diversified commodity trading advisers 0.2 per cent, special situations funds 0.17 per cent and merger arbitrage funds 0.09 per cent.
New Wall Street Exposé Details Life as a Lowly Analyst (InstitutionalInvestorsAlpha)
The average 21-year-old is more adept at beer pong than at deciding his future. So it shouldn’t be surprising that a great many recent college graduates pursue jobs in banking, lured by not just outsize salaries but also an initial commitment of only two years. That, at least, is the view of New York magazine business writer Kevin Roose in his latest book. In Young Money: Inside the Hidden World of Wall Street’s Post-Crash Recruits (Grand Central Publishing; $27), Roose intertwines himself into the not-so-happy lives of eight first-year banking analysts.
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