Hedge Funds Feel The January Blues As Subscriptions Slip (Reuters)
Hedge funds have started the new year with a bout of the January blues, as investors get their books in order to start afresh in 2012, after last year’s rollercoaster ride, data showed on Wednesday. The GlobeOp (GO.L) Capital Movement Index, which tracks monthly net subscriptions to and redemptions from hedge funds managing around $170 billion (111 billion pounds) of assets, declined 0.88 points to 140.18 this month.
Hedge Funds Try To Profit From Greece (Bloomberg)
Hedge funds in New York and London are trying to profit from trading Greek government bonds as European banks brace for losses from a debt swap. Saba Capital Management LP, founded by former Deutsche Bank AG (DBK) credit trader Boaz Weinstein, York Capital Management LP, the $14 billion fund started by Jamie Dinan, and London-based CapeView Capital LLP are among managers that now hold Greek bonds, according to people with knowledge of the transactions who declined to be identified because they weren’t authorized to speak publicly about the trades. Officials at the three firms declined to comment.
Blain On Greek Debt (Bloomberg)
Bill Blain, co-head of the Special Situations Group at Newedge Group Ltd., talks about hedge funds trying to profit from trading Greek government bonds as European banks brace for losses from a debt swap. Blain also discusses the yields on Italian and Spanish bonds. He speaks with Mark Barton and Linda Yueh on Bloomberg Television’s “On the Move.”
The Great Hedge Fund Humbling Of 2011 (Reuters)
Some of the best-known hedge fund managers have offered lots of excuses for underperforming the major stock market indexes last year, with many large funds posting double-digit losses. In letters to investors, managers pointed to things like Europe’s debt crisis, a slower-than-expected economic recovery in the United States, and unforeseen events like Japan’s nuclear disaster all coming together to create a tricky trading environment that was characterized by big and often unpredictable swings in stock prices. The result was a humbling year for the $1.7 trillion (1.1 trillion pounds) hedge fund industry, with the average fund dropping 4.8 percent and some stock-focused funds suffering an average 19 percent decline, according to research compiled by Hedge Fund Research and Bank of America Merrill Lynch analysts.
Senrigan, Azentus Among Asian Hedge Funds Said To Have Lost Money In 2011 (Bloomberg)
Senrigan Capital Group Ltd. and Azentus Capital Management Ltd., two of Asia’s biggest hedge- fund startups since 2009, lost money in 2011 as the region’s funds had their second-worst performance on record, said four people familiar with the returns. Senrigan (SENGRZ), which manages about $1 billion and is backed by Blackstone Group LP, is estimated to have lost more than 8.5 percent last year, said two of the people with direct knowledge of the figures, who asked not to be identified because the information is private. Azentus lost 6.8 percent since it was started in April by a former Goldman Sachs Group Inc. executive, said two other people.
Hedge Fund CEO Brownstein Gets One Year For Insider Scheme (Bloomberg)
Drew “Bo” Brownstein, the founder and chief executive officer of Denver-based Big 5 Asset Management, was sentenced to one year and a day in prison for trading on inside information about a corporate merger. U.S. District Judge Robert Patterson in Manhattan today also ordered Brownstein to perform 500 hours of community service and to forfeit $2.44 million. Brownstein also will serve six months house arrest after his prison release and was fined $7,500. Brownstein, 35, made more than $2.5 million in illegal profits for his hedge fund and for relatives by trading on a tip in advance of Apache Corp. (APA)’s $2.7 billion acquisition of Mariner Energy Inc. (ME) in April 2010, prosecutors said.
Carl Icahn Fought Back Oshkosh With A Second Presentation (Insider Monkey)
Carl Icahn delivered the second presentation today after the board of Oshkosh claimed against Icahn’s presentation yesterday. Oshkosh claimed that they have low SGA (Selling, General and Administrative Expense) margins regarding Icahn’s blame for the company’s poor performance. Also the management has taken “decisive action” and will only reaffirm business model rather than do a “comprehensive review”. Oshkosh also accused Icahn’s slate for lacking experience in the industry.
Buffett To Republicans: If You Pay, So Will I (Reuters)
Warren Buffett is willing to put his money where his mouth is, if only congressional Republicans would join him. The American billionaire investor, in the new issue of Time magazine, says he would donate $1 to paying down the national debt for every dollar donated by a Republican in Congress. The only exception is Senate Republican leader Mitch McConnell – for whom Buffett said he would go $3-to-$1.
Avenue Scores $2.1 Billion For Distressed Debt Fund (FINalternatives)
Hedge fund Avenue Capital Group’s second European distressed debt private equity fund is well on its way to its $2.5 billion capacity. The firm has raised $2.1 billion for its Europe Special Situations Fund II as of its fourth closing, on Dec. 22, Bloomberg News reports. Avenue said the fund will seek to profit from opportunities stemming from Europe’s sovereign debt crisis and from the continent’s banks’ need to shed some of their huge debt holdings.
Alternative Investing In 2012 – Ramius’ Thomas Strauss On CNBC (Reuters Hedge World)
Thomas Strauss, Ramius president & CEO, discusses the investment outlook for hedge funds, commodities and real estate in the new year. “Institutions and private clients around the world are still well under-invested in hedge funds,” Strauss told CNBC’s Maria Bartiromo on the Closing Bell. “Fees are too high, and we’re trying to address that problem by helping clients understand which hedge funds really produce alpha and which don’t. And there are a lot of exposures created by hedge funds that can be owned in liquid format at much lower costs by ETFs and other liquid instruments than just owning hedge funds.”
Fund Managers Will Earn More in 2012 (HFN)
A new report reveals that hedge fund managers will anticipate an increase in base salary, while seeing a decrease in year-end bonuses. The 2012 Hedge Fund Compensation Report also reveals that the salary increase is expected to cover the decrease of the bonuses, according to a statement released by the report.
Kashya Hildebrand Says Husband’s ‘Stained’ Credibility Breaks Her Heart (Bloomberg)
The wife of Switzerland’s former central bank chief said the currency deal that cost her husband his job was “my idea” and apologized to the nation. Philipp Hildebrand, 48, stepped down on Jan. 9, saying he couldn’t prove conclusively that the Aug. 15 purchase of $504,000 was initiated by his wife rather than himself. The Swiss National Bank (SNBN) on Sept. 6 imposed a franc ceiling of 1.20 versus the euro to protect the economy, sending the single currency and the dollar higher.
Hedge Fund Picks Up Stake In CA, Shares Rise (Reuters)
Hedge fund Taconic Capital reported a roughly 5 percent stake in CA Inc. (CA.O) and said it was in talks with the business software maker’s management about its business strategy, sending the company’s shares up 6 percent in after-hours trading. According to a filing with the Securities and Exchange Commission, Taconic owns 5.14 percent, or about 25.4 million shares, of CA as of Jan 6, which it acquired for about $563.5 million.
Sears Supplier Loans Are Said To Be Halted By CIT Starting Today (Bloomberg)
Sears Holdings Corp. (SHLD) declined after two people familiar with the situation said suppliers will no longer be able to get loans from CIT (CIT) Group Inc. for their shipments to the retailer. Sears fell 9.7 percent to $29.71 at 7:46 a.m. in New York. The shares dropped 56 percent last year. Sears has lost ground as shoppers have flocked to such rivals as Macy’s Inc. (M). Chairman Edward Lampert, who along with his hedge fund owns about 60 percent of the U.S. department store chain, has presided over four years of declining sales since merging Sears Roebuck with Kmart in 2005.
Wausau Paper’s Largest Shareholder Urges Co To Sell Itself (Reuters)
Wausau Paper’s largest shareholder backed the company’s decision to sell its print and color brand and close its mill in Wisconsin, but said it must evaluate strategic alternatives, including a sale of the company. Starboard Value LP said the board should retain a reputable financial adviser to evaluate all alternatives to maximize value, including a potential sale of the paper segment or the company as a whole, a regulatory filing showed. The activist hedge fund holds about 7.5 percent of the company’s outstanding stock as of Sept. 29, according to a filing.
Dynegy Bankruptcy Examiner Appointed (Thomson Reuters)
A lawyer involved in several major recent bankruptcies has been named the examiner for the bankruptcy of Dynegy Holdings LLC and will investigate whether the company is treating bondholders fairly. It requires court approval and follows the Chapter 11 filing last Nov. 7 by the holding company for power producer Dynegy Inc, which is trying to restructure more than $4 billion of debt. This restructuring is unusual because it would cause losses for bondholders, yet protect shareholders such as the Seneca Capital hedge fund and billionaire financier Carl Icahn.
Oak Hill Names Four Partners To Firm (HFN)
New York-based credit hedge fund firm Oak Hill Advisors has named four new partners. Alexandra Jung, Adam Kertzner, Jeffrey Kirt and Thomas Wong will join the six existing partners in leading the firm, according to a company statement.
