German Finance Minister Unhappy About EU Hedge Fund Trade Rules (Finalternatives)
Hedge funds are once again facing a skeptical eye from Germany. The European Union at last released a proposal to reduce systemic risk at big banks yesterday. The regulations, similar to the Volcker rule in the U.S., would bar European banks from proprietary trading and require them to separate some riskier operations. But the bloc’s biggest economy isn’t happy with its provisions on hedge funds.
Fast growing Asia hedge fund Segantii hit by resignations (HedgeWorld)
Segantii Capital Management, one of Asia’s fastest growing hedge funds, has been hit by five resignations in the last few weeks, people with knowledge of the matter told Reuters, after the firm saw its first annual loss. Such an exodus is rare in the industry, and it marks a sharp u-turn for a fund that has grown to manage about $750 million from just $25 million in 2007, making it one of the biggest capital raising successes in the region.
US person problems: Hedge funds caught in transatlantic tug-of-war (Risk)
The laws of quantum mechanics, which state an object can exist in multiple forms and places at the same time, confused even Einstein, who said, “no reasonable definition of reality could be expected to permit this”. Hedge funds could say the same thing about rules governing cross-border derivatives transactions, which in their current form will require some firms to do the impossible. “The cross-border application of US regulation puts a lot of European hedge funds in the impossible position of having to simultaneously comply with two regimes that are in some respects incompatible,” says the head of risk at a hedge fund in London.
Rhode Island Terminates Third Point, Calling It Too Risky (Finalternatives)
Rhode Island’s main public pension fund has dropped Third Point following calls from the national teachers’ union. The State Investment Commission said it would redeem its investment from the New York-based activist hedge fund, in spite of the fact that it has earned a 49% return on its initial $50 million investment since it was made two years ago. Treasurer Gina Raimondo, who leads the commission, said that move was not political, but was based on the belief that Third Point had become too risky. Last year, the American Federal of Teachers issued a list of 33 investment managers featuring individuals linked to three groups the union claims are seeking to end defined-benefit plans for teachers and other public employees. One of the groups is the Manhattan Institute, where Third Point’s Dan Loeb serves as a trustee…
Hedge fund manager George Jarkesy Jr asks Washington federal court to block SEC hearing (VCPost)
A hedge fund manager who is dealing with claims from the US Securities and Exchange Commission that he has deceived investors by steering higher fees to the John Thomas Financial Inc brokerage filed a case in order to halt a hearing by the agency, Bloomberg reported. Manager George Jarkesy Jr said that if the administrative proceeding by the regulator should push through, his right to due process and equal protection as enshrined in the US Constitution would be violated. Jarkesy Jr is facing a possible $100 million fine and could even be banned from the securities industry based on the SEC complaint, the report said.
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