As speculation mounts that Avenue Capital hedge fund co-founder Marc Lasry will be nominated as the next U.S. ambassador to France, his $12 billion firm has told investors it is naming its first chief investment officer, according to a memo reviewed by Reuters. Lasry, who co-founded the distressed debt firm with sister Sonia Gardner in 1995, is a longtime Democratic donor who was one of the few hedge fund managers to support President Barack Obama during his re-election campaign last year.
Pensions Want Chat With Ackman On Penney (FINalternatives)
Pershing Square Capital Management’s William Ackman wants more information about nutritional supplements company Herbalife, which he accuses of being a pyramid scheme. But two of his investors want more information about one of Pershing Square’s other major investments. Two state pension funds plan to meet with Ackman to learn more about Pershing Square’s investment in JC Penney, which has cost the hedge fund $500 million on paper, Reuters reports. Penney’s stock is down 21% this year; Ackman sits on the retailer’s board.
The hedge fund managers profiting off Sandy Hook (Salon)
Arms manufacturers Smith & Wesson, Cabela’s and Big 5 all boasted sterling third quarter results in the post-Sandy Hook gun boom. A number of big retail chains moved to end sales of AR-15s and similar assault weapons in the wake of the shooting and Cerberus Capital, the New York firm that owned Bushmaster, sold the company, calling the Connecticut shooting a “watershed event.” But a small number of hedge funds, accustomed to a sadly familiar pattern (gun massacre, leads to fear of gun bans, leads to mass gun sales), moved to make bank on the tragedy and this predictable trajectory. In an unremarkable February report, Bloomberg News noted that Owl Creek Asset Management LP bought 1.62 million Smith & Wesson shares around the time of the Sandy Hook shooting.
Hedge fund firm fined £9.2 million for insider trading of Dell shares (ComputerworldUK)
Sigma Capital Management has agreed to pay $14 million (£9.2 million) to settle charges for insider trading relating to Dell Inc. (NASDAQ:DELL) and Nvidia earnings calls, following a Securities and Exchange Commission (SEC) investigation. The SEC said that hedge fund advisory firm Sigma Capital Management, an affiliate of SAC Capital, engaged in insider trading using information obtained through former analyst Jon Horvath.
Hedge fund firm Man Group caps executive bonuses (The Sydney Morning Herald)
Man Group is to cap future cash bonuses for its senior executives, the hedge fund manager said in its 2012 annual report published on Monday. Man said that short-term annual cash bonuses, which were previously uncapped, would be limited to 250 percent of salary for executive directors after discussions with shareholders. It also follows political pressure to cap bonuses for senior executives in the finance industry after the excesses of the financial crisis. The firm is also paying no bonuses to top executives for 2012. The change in policy on bonuses comes under new chief executive Emmanuel Roman, who took up his job last month and is trying to turn around the fund firm.
Paulson hedge fund seeks dismissal of Abacus lawsuit (4-traders)
Paulson & Co asked a judge to dismiss a lawsuit accusing the firm of conspiring with Goldman Sachs Group Inc to get a bond insurer to guarantee payments on an investment allegedly designed to fail. In a filing in New York on Monday, Paulson said it “made no misrepresentations” to ACA Financial Guaranty about the collateralized debt obligation known as Abacus. ACA brought the $120 million complaint against Goldman in 2011 and amended its lawsuit in January, adding Paulson & Co and its hedge fund, Paulson Credit Opportunities Master II Ltd, as defendants.
Brazil Billionaire Batista Said to Face Collateral Calls (Bloomberg)
Eike Batista, the Brazilian billionaire whose oil-company shares fell to a record low last week, is close to selling a stake in MPX Energia SA (MPXE3) as he faces demands from creditors to boost collateral, people with direct knowledge of the matter said. Among Batista’s biggest creditors is Sao Paulo-based Itau Unibanco Holding SA, with about 5.5 billion reais ($2.8 billion) in loans outstanding, said two of the people, who asked not to be identified because the matter is private. Batista borrowed about 4.8 billion reais from Banco Bradesco SA and 1.6 billion reais from Grupo BTG Pactual, not counting a credit line of $1 billion BTG provided earlier this month, the people said.
Mid-March figures from HFRX show Global Hedge Fund Index up 1.39%, year to date up 3.29% (Opalesque)
The HFRX Daily Indices March 2013 Intra Month Update reveals that hedge funds posted gains over the period, with the HFRX Global Hedge Fund Index gaining +0.86% through mid-March, 3.29% year to date, and the HFRX Market Directional Index posting a gain of +1.39%, 4.94% year to date. Financial markets extended early 2013 gains into mid-March, as both US and European equities and the US dollar gained through mid-month. US equities eclipsed record highs as the DJIA rose through mid-March, with the S&P 500 approaching a record level while the Nasdaq also posted gains.
Hedge Fund Marketing Alliance Publishes the Hedge Fund Cheat Sheet (Digital Journal)
Want to learn more about the secret world of hedge funds? Look no further than the latest Hedge Fund Cheat Sheet. Published by the Hedge Fund Marketing Alliance, the document provides a comprehensive primer on the basics of hedge funds, making it an excellent educational tool. It also offers tips for the more sophisticated investor. This quick-reference tool sells for $19 USD, but you can download it for free for personal use.
