Paul Singer Fund: Market ‘Breakdown’ To Be ‘Sudden, Intense, And Large’ (CNBC)
In a bleak new letter to investors, Paul Singer‘s Elliott Management warns that the bond market is “broken” and that when the central bank actions of recent years no longer ward off a market downturn, the subsequent loss of confidence could be severe. The fund’s recent investor letter, which covers the second quarter, notes that Elliott’s managers are currently seeing “what is in many ways the most peculiar period we have faced in 39 years.” Too much power has been ceded to central banks, the letter adds, the value of money has been debased, inflation is probably inevitable, and when it happens, it could be swift and impossible to tamp down. Elliott is a $28 billion fund founded in 1977 by Singer, now its president. The fund is up more than 6 percent for the year through July, according to an investor.
Hedge Fund Och-Ziff Considered Sale of Part of Firm (The Wall Street Journal)
Och-Ziff Capital Management Group LLC, the largest publicly traded hedge-fund firm in the U.S., explored the possibility of a partial sale earlier this year, people familiar with the matter said. Representatives of Och-Ziff spoke to private-equity firms and asset managers including Pacific Investment Management Co. about their buying part of its business, making a so-called strategic investment in the firm or pursuing a joint venture, the people said. The talks are no longer active, some of the people said. “We are not contemplating selling any part of the firm or any other strategic transactions,” Och-Ziff spokesman Joe Snodgrass said.
Activist Hedge Fund Hudson Cuts Comerica Stake as Bank Punts on Sale (The Street)
Activist hedge fund Hudson Executive Capital has slashed its stake in Dallas-based lender Comerica (CMA) by more than half, after pressing the company unsuccessfully this year to put itself up for sale. Hudson, run by former JPMorgan Chase investment bankers Doug Braunstein and Jim Woolery, owned 598,500 shares of Comerica as of June 30, down by 55% from the March 31 level, according to regulatory filings. A person familiar with the matter said the hedge fund was actively trading the stock in early June, when the shares climbed to an eight-month high of around $47.
Mob Bust Said to Prompt Point72, Glenview to Cut Broker Ties (Bloomberg)
After prosecutors, the FBI and New York police announced racketeering charges against 46 members and associates of organized crime families this month, some of the defendants’ colorful nicknames (“Mustache Pat,” “Nicky the Wig” and “Tony the Cripple”) attracted attention and spawned jokes on social media. But the name of one defendant, Anthony Cirillo, was no laughing matter to some of the biggest hedge fund operators on Wall Street. Cirillo is the owner of Princeton Securities Group, a floor broker on the New York Stock Exchange that makes trades for hedge funds and investor groups. Its clients have included Point72 Asset Management — the reincarnation of Steven Cohen’s SAC Capital — and Glenview Capital Management, according to people familiar with the matter. After learning of Cirillo’s arrest, Point72 and Glenview Capital severed ties to the trading company, these people said.
Trump Shake-Up Reflects Hedge-Fund Manager’s Growing Influence (The Wall Street Journal)
Republican presidential candidate Donald Trump’s latest staff shake-up reflects the growing behind-the-scenes influence of a wealthy backer relatively new in the nominee’s orbit: billionaire hedge-fund manager Robert Mercer. Mr. Mercer, co-chief executive of the hedge fund Renaissance Technologies, has longstanding ties to both people elevated to top posts in the campaign on Wednesday. He and his daughter, Rebekah, had recommended both Breitbart News chairman Stephen Bannon and Republican pollster Kellyanne Conway, who already worked for the campaign, according to people familiar with the matter.
Steve Eisman’s Next Big Short Is Hedge Fund Fees (Bloomberg)
Steve Eisman made his name and fortune by foreseeing the collapse of subprime mortgage securities. Now he’s betting against a different kind of Wall Street money machine. He thinks hedge fund fees are going to tumble. Eisman works at Neuberger Berman, a money management firm he joined after closing his hedge fund two years ago. He invests in classic hedge fund style, buying stocks he expects will rise in price while betting on others to fall. His services for an investment of $1 million cost 1.25 percent of assets per year. That’s not exactly cheap—many long-only mutual funds charge far less—but it’s a far cry from prices in hedge fund land, where the standard is a 2 percent annual charge plus a performance fee of 20 percent of profit.
Ex-BlueBay Da Fonseca Said to Join $2 Billion Glen Point Capital (Bloomberg)
Glen Point Capital, one of the largest hedge funds to open in Europe this year, has hired former BlueBay Asset Management LLP money manager Rodrigo Da Fonseca as head of credit strategies, according to a person with knowledge of the matter. The London-based firm also hired Sean Shepley, Credit Suisse Group AG’s former head of global macro product strategy, as its head of research, the person said, asking not to be identified because the information is private. A spokesman for Glen Point declined to comment. Da Fonseca declined to comment, while Shepley didn’t reply to an e-mail and calls seeking comment.
