Pension and hedge fund capital pushing down premiums (InsuranceBusinessOnline)
An influx of capital from non-traditional sources is contributing to increased market capacity, lower premiums, and greater competition in the global insurance industry, according an Aon boss. Commenting on insurance markets in 2013, Jason Disborough, managing director, global, for Aon Risk Solutions said that the market conditions that increased competition between insurers and lowered premiums across the board this year was likely to continue into 2014. Disborough said that increased capital flows into the industry from non-traditional sources has resulted in a convergence of traditional and non-traditional capital, translating into excess capacity which insurers have been unable to absorb through organic growth.
Hedge fund manager conned La. retirement systems out of $100 million, report says (TheAdvocate)
A New York hedge fund manager apparently conned three Louisiana retirement systems out of $100 million in an investment scheme that promised high returns with low risk, a court-appointed bankruptcy trustee says in a recent report. In 2008, trustees of the pension plans — the New Orleans Firefighters’ Pension and Relief Fund and two statewide funds, the Firefighters’ Retirement System and the Municipal Employees’ Retirement System — invested the money in the flagship fund of Fletcher Asset Management, which offered a guaranteed 12 percent rate of return. If returns fell below that mark, they were told, the gap would be covered by $50 million put up by a subsidiary of the financial services firm Citco Group Ltd.
A Hedge Fund Strategy Without The High Fees (TheStreet)
Merger arbitrage strategies are used by some investors to get alternative exposure to the stock market with diversification benefits and potentially less volatility. Atlas Capital manages a merger arbitrage portfolio on Covestor with a twist. MergerArb portfolio is designed to identify companies that could be acquired, and profit from the deal premium. “We think of this portfolio as ‘alternative beta’ at a lower cost than what hedge funds are typically charging,” said Jonathan Tunney, founder and chief investment officer of Atlas Capital. In financial jargon, beta is typically referred to as index-based, passive exposure to the market.
Heating subsidy by Soros charity turned down by parents association in northern Greece (Ekathimerini)
A school parents association in Naoussa, in northern Greece, has turned down a donation of heating oil by the Open Society Foundations, a charity network funded by billionaire George Soros, reports said on Thursday. The fund recently announced it would donate an unspecified amount of oil to the local municipality to keep the classrooms warm. Following a decision by local authorities, schools were recently closed in Florina, Naoussa, Drama, Kozani and Kastoria in protest at the lack of heating subsidies. In a statement, the parents association reportedly said that covering the schools’ heating needs was an obligation of the state. A representative for the parents also questioned the motives behind the move.
Asian Hedge Funds as Much as 42% Cheaper to Run, Survey Says (Bloomberg)
Running a hedge fund in the Asia-Pacific region can be as much as 42 percent cheaper than in the U.S. and Europe, helped by lower-than-average compensation, according to a survey by Citigroup Inc (NYSE:C) Small funds started in the region struggle to achieve profitability and expand assets, the fourth-largest U.S. bank cautioned. Ninety-five, or 57 percent, of the 167 regional equity long-short hedge funds which began trading with less than $50 million still manage less than that amount after an average of 5.3 years in existence, it added, citing data from Singapore-based Eurekahedge Pte.
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