Two ETFs for Your Inner Hedge Fund Hero (ETFTrends)
Being a hedge fund manager sounds glamorous and, for some, it is very, very lucrative. However, parsing through the largest individual holdings of famous investors is not as rewarding a strategy as it may appear. For example, following a basket of Baupost’s top-10 holding “beat the markets but about 9% a year since 2000. Want to follow Baupost’s top holding? BAD IDEA. Returns -0.9% a year, over 4% a year worse than the S&P,” according to Mebane Faber. Faber notes that the difference is roughly the same, about 9% a year, when applying a similar strategy to the equity holdings of Warren Buffett’s Berkshire Hathaway Inc. (NYSE:BRK.A).
Highland Sues Ex-Partner’s Law Firm For Alleged Extortion Attempt (Finalternatives)
The ugly battle between Highland Capital Management and its former private-equity chief has taken another bizarre turn. The Dallas hedge fund has sued the law firm representing Patrick Daugherty, alleging that it sought to extort $2 million from it. Highland said in a lawsuit that Daugherty sought the money in exchange for his silence, and that Looper Reed & McGraw moved to get it for him. “Both Looper Reed and Daugherty made it clear to Highland that Daugherty would continue his efforts to slander and disparage Highland unless Highland agreed to pay Daugherty more than $20 million and that if Highland failed to do so Looper Reed intended to make it ‘bad’ for Highland,” the hedge fund alleges.
Study Shows Women Beat Men As Hedge Fund Managers (Finalternatives)
The evidence for the superiority of female hedge fund managers is growing. Another study of sex-based performance finds that women outperform their male peers in the alternative investments industry. The latest, from Rothstein Kass, shows that in the five years ending last September, an index of 67 woman-owned funds beat the broader HFRX Global Hedge Fund Index by a wide margin. The women’s index returned 3.6% over the period, while the broader index lost 3%. The reason? Women take less risk and hold on to their investments longer.
Hedge Fund Pitches 4 New Directors For Luxury Hotel REIT (Law360)
Activist hedge fund Orange Capital LLC said Wednesday that it plans to nominate four directors to the board of Strategic Hotels & Resorts Inc., renewing calls for change at the real estate investment trust in which it is a substantial minority shareholder. Over the summer, New York-based Orange first tore into Strategic Hotels, blasting the company for failing clue in shareholders about potential sale plans. With no apparent sale plans drawn up since then, the hedge fund — which holds a 4 percent stake — is…
Bidding War Erupts Over TimeGate Videogames (WSJ)
A bidding war has broken out over the rights to a pair of games created by shuttered videogame developer TimeGate Studios Inc. Hedge fund CNH Partners , an affiliate of Greenwich, Conn.’s AQR Capital Partners, said it made a higher offer for the rights to two of TimeGate first-person shooter titles—“Section 8” and the unreleased “Minimum.” According to court papers, CNH teamed with game developer Digital Tribe Games to offer $50,000 in cash plus a 25% royalty on the two games, topping a winning bid by France’s Atari SA. SouthPeak Interactive Corp., which won a multimillion-dollar arbitration award against TimeGate in their dispute over “Section 8,” also says its offer—$40,000 and a 50% royalty—is better than Atari’s, which tried to unload some of its U.S. assets in bankruptcy court earlier this year.
Hedge-Fund Managers to Share Best Ideas at Robin Hood (Bloomberg)
Hedge-fund managers including David Tepper, Ray Dalio and Daniel Loeb will help raise $5 million to fight poverty in New York by sharing some of their best trading ideas with attendees of the Robin Hood Foundation’s inaugural investors conference, said the charity’s executive director. Attendees “are going to get some of the best tips they ever had,” David Saltzman said in an interview with Bloomberg Television’s Stephanie Ruhle today. Appaloosa Management LP’s Tepper, Bridgewater Associates LP’s Dalio and Third Point LLC’s Loeb will be joined at the conference, which starts today, by former U.S. Treasury Secretaries Timothy Geithner, Henry Paulson and Lawrence Summers.
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