Editor’s Note: Related tickers: Tesla Motors Inc (NASDAQ:TSLA), Focus Media Holding Limited (ADR) (NASDAQ:FMCN), Acme Packet, Inc. (NASDAQ:APKT), Penn National Gaming, Inc (NASDAQ:PENN), H.J. Heinz Company (NYSE:HNZ), Robbins & Myers, Inc. (NYSE:RBN), Dell Inc. (NASDAQ:DELL), Apple Inc. (NASDAQ:AAPL), JPMorgan Chase & Co. (NYSE:JPM)
Billionaire investor George Soros has struck back at one of Germany’s top economists for distorting his arguments on Germany’s role in the euro zone. Hans-Werner Sinn, president of the influential Ifo Institute for Economic Research and a member of the German economic ministry’s Advisory Council, said last week that George Soros was “playing with fire” by calling on Germany to exit the euro zone if it continues to block the introduction of Eurobonds. Sinn said mutualization of euro zone sovereign debt would boost support for the newly founded euro-skeptic “Alternative for Germany” party and could spell the end of the single currency.
Former MICG Investment CEO takes the stand in federal court (DailyPress)
The former head of a Newport News brokerage took the stand Monday to say why the hedge fund he managed had a large stake in a solar panel company. Jeffrey A. Martinovich, the former CEFO of MICG Investment Management, is facing federal fraud charges as prosecutors argue during the trial that he sought inflated estimates of a solar company’s value to achieve gains for the hedge fund and increase the incentive fees that MICG would collect. Martinovich countered that argument to say he simply believed in the solar panel company that later collapsed into bankruptcy and hadn’t received negative company information to share with investors. MICG also collapsed in May 2010.
ArbitrOption’s event driven fund up almost 39% YTD as hedge fund strategy generally enjoys positive quarter (Opalesque)
A small U.S.-based event driven fund outperformed its peers this quarter, just as the event driven strategy generally enjoyed a positive first quarter. Furthermore, many agree that the outlook for this strategy this year is bullish. ArbitrOption’s event driven strategy rose 38.97% in the first quarter of 2013, compared to the S&P500’s 10% and the Dow Jones Credit Suisse Event-Driven Index’s return of 4.78%. ArbitrOption’s strategy is up 487% since its August 2009 inception. Heath Winter, ArbitrOption’s managing partner and portfolio manager, explains to Opalesque that the top five contributors to ArbitrOption’s outperformance in Q1 were positions in Acme Packet, Inc. (NASDAQ:APKT), Focus Media Holding Limited (ADR) (NASDAQ:FMCN), Penn National Gaming, Inc (NASDAQ:PENN), H.J. Heinz Company (NYSE:HNZ), and Robbins & Myers, Inc. (NYSE:RBN).
India hedge funds struggle in competitive market (Opalesque)
Indian hedge fund managers are struggling to attract investors but hope to succeed where their much larger foreign counterparts don’t, reports India Times, citing some local fund managers who produce double-digit returns. In a nation where investors prefer stocks, local hedge fund managers, who enjoy the advantage of first-hand information on the local market and the lack of foreign currency exposure, face a huge challenge to convince investors to shift to an unfamiliar investment style (such as long/short equity) and to high fees.
Paulson Leads Hedge-Fund Lobby Push to Privatize Fannie (Bloomberg)
Hedge funds including Paulson & Co. Inc. are pushing Congress to abandon plans to liquidate Fannie Mae (FNMA) and Freddie Mac as investors buy up preferred stock that has long been considered worthless, according to people with knowledge of the discussions. The improving finances of the two government-owned mortgage companies have kindled hopes among shareholders that they could be revived as private firms. Even as lawmakers from both parties and U.S. housing officials say that won’t happen, preferred shares of Fannie Mae have more than doubled in price since early March. They closed at $4.75 yesterday.
Indiana Public Retirement System invests $365 million in hedge funds (PIOnline)
Indiana Public Retirement System, Indianapolis, at a meeting April 26 announced a total of $365 million in new absolute-return hedge fund investments the $27.1 billion pension fund made since March 1, according to an investment report presented at the meeting. Commitments of $100 million each were made to Emerging Sovereign Group, which runs an emerging markets long/short equity fund; MKP Capital Management, for a long/short structured credit fund; and Kepos Capital for its Kepos Macro Fund. Oxford Asset Management was given $65 million for its quantitative equity market-neutral fund. The commitments to all but the Kepos fund were made on March 1; the Kepos commitment was made April 1.
Firm Seeks $39 Million From Convicted Ex-Employee (WSJ)
Diamondback Capital Management LLC is seeking to recoup $39 million in legal fees and compensation from a former hedge-fund manager convicted of insider trading last year. Todd Newman, once a Diamondback portfolio manager, was convicted in December of making improper trades based on corporate secrets about Dell Inc. (NASDAQ:DELL) -0.07% and other technology companies. He is set to be sentenced Thursday. As part of his sentencing, Diamondback, a Stamford, Conn., fund, is seeking to recoup legal expenses associated with its efforts to assist the government’s broad insider-trading probe, including responding to government subpoenas and turning over more than four million documents. It is also asking to recoup a quarter of Mr. Newman’s pay in the three years he was with the firm.
Tesla Is The Next Apple, And It’s Going To $200/Share (BusinessInsider)
Last week, electronic car maker Tesla Motors Inc (NASDAQ:TSLA) announced a bunch of changes to its service and warranty policy that will make it easier for customers to take care of their Model S cars. Since then, the stock is up 5.73%, and it’s at new 52-week highs. This is a headache for a ton of people on Wall Street as Tesla Motors Inc (NASDAQ:TSLA) is a really popular short. And as the bears are heading into their caves, the bulls are coming out to explain their side of the story. Investment firm Longboard Asset Management kindly sent us their long thesis on Tesla Motors Inc (NASDAQ:TSLA). They believe the stock will go to $200/share in 5 years (it’s currently just below $55), that the shorts are going to get clobbered, and that the brand has the power to be the next Apple Inc. (NASDAQ:AAPL).
