Big hedge fund investor downgrades IBM, bets on Amazon (WralTechWire)
Stan Druckenmiller, who has one of the best track records in the hedge-fund industry over the past three decades, said he’s betting against shares of International Business Machines Corp. (NYSE:IBM) while wagering on younger technology companies such as Amazon.com, Inc. (NASDAQ:AMZN). “IBM is old technology being replaced by cloud technology,” Druckenmiller, 60, said in an interview with Bloomberg TV’s Stephanie Ruhle at the Robin Hood Investors Conference in New York on Friday. “It’s one of the more higher- probability shorts I have seen in years.” Sales at the 102-year-old IBM have dropped for six straight quarters as the growth of services such as cloud computing have failed to make up for slowing demand for older businesses like hardware.
Frat brothers cheer on Cohen (NYPost)
Not everyone soured on hedge-fund billionaire Steve Cohen after his multibillion-dollar hedge fund copped to insider trading this month. Cohen’s frat brothers from the University of Pennsylvania chapter of Zeta Beta Tau cheered the hotshot hedgie just one day after his SAC Capital Advisors pleaded guilty to a decade of illegal trading that resulted in a record $1.2 billion fine, sources told On the Money. On Nov. 9, current and former ZBT members got together to break ground on planned renovations and an expansion to ZBT’s four-story frat house in Philly. The person they had to thank most of all for getting them there? “Brother Steve Cohen,” Class of ’78, sources said.
Why hedge funds still manage to attract (OmanObserver)
Hedge fund investor Hugh Culverhouse Jr says the $2.25 trillion industry was an easier place for wealthy individuals to make money a decade ago. Funds were smaller, returns were higher and managers did more to cultivate the support of those well-heeled individuals and families because large institutions like pension funds had yet to embrace the industry. “It was so simple [for managers] to leverage up and make a fortune,” said Culverhouse Jr, 64, a Miami-based trial attorney whose father owned the National Football League team, the Tampa Bay Buccaneers, from 1976 until the early 1990s. Shortly after his father’s death in 1994, Culverhouse Jr sold the team. Though he has money with Daniel Loeb’s $13 billion Third Point LLC, Culverhouse said he favours smaller, more nimble hedge funds that have more flexibility to trade and capitalise on different markets.
A Big, Dispassionate Bet on Europe’s Recovery (Barrons)
Stephen Roberts attributes a lot of his recent investment success to avoiding the passion—and occasional panic—of the markets. He used to keep to himself in the library-like offices of Horseman Capital Management in London. In 2011, he took it a step further. He bought a tranquil, manicured estate in the British tax haven of Jersey in the Channel Islands off the coast of France. Roberts wanted to “isolate” himself from the “noise and distraction” of the European financial centers of London, Frankfurt, Zurich, and Milan. As a rule, Roberts never visits a company he invests in or meets its managers…
Direct lending firm hits $3 billion as investors pile in (CNBC)
Amid still tight lending from traditional sources, direct lending is hot and Steve Czech is taking full advantage. The hedge fund firm he runs, Czech Asset Management, has just closed its second fund to new capital after raising $1.5 billion, according to a person familiar with the situation. Czech had originally sought $1 billion for the SJC Direct Lending Fund II but that was increased due to high demand. Investors—including public pensions in Michigan and South Carolina—asked to commit about $1.8 billion but were limited to the $1.5 billion maximum.
Hedge Fund Gold Bets Less Bullish as Paulson Holds: Commodities (Bloomberg)
Hedge funds got less bullish on gold, cutting their net-long position to a four-month low, before prices capped the biggest weekly retreat since September. Net holdings in futures and options tumbled 20 percent to 44,291 contracts in the week ended Nov. 19, the lowest since July 9, U.S. Commodity Futures Trading Commission data show. Short bets rose 16 percent to the highest since Aug. 6 and long wagers slid 2.5 percent. Net-bullish wagers across 18 U.S.- traded commodities fell 12 percent as investors became the most bearish on copper since July and cut their silver holdings by the most in five months.
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