Bloomberg Hedge Funds 09.07.10 BRIEF
Outflows Reach Highest Level Since January inside Page By Nathaniel E. Baker Performance Tables 2 The hedge fund industry posted an outflow funds in the BarclayHedge database. The Wire 3 of $2.9 billion, or 0.2% of its total assets, this Commodity trading advisors fared better, at- July, the most since January, according to es- tracting $3.8 billion in July. It was the twelfth Regulatory/Compliance 4 timates by research firm Trimtabs. month of inflows in the past 14 months, a sign Market Calls 5 July's number follows an outflow of $2.7 bil- of demand even as returns posted by the lion in June. The industry has dropped 4 per- CTAs are down 1 percent so far this year. 13F Forensics 6 cent since April 2010, according to Trimtabs, Trimtabs said that hedge funds appear to Over The Hedge 7 which attributed the decline mostly to nega- have missed out on market gains in the S&P tive returns in May and June. Flows have now 500 Index during July because of conserva- been negative five of the last eight months tive positions. The S&P 500 surged 6.9 per- (see chart, this page), the worst eight-month cent during the month, while hedge funds Global Hedge Fund Returns stretch since the September 2008 to April gained only 1.93 percent. The Bloomberg BAIF Hedge Fund Index rep- resents all hedge funds tracked by Bloomberg 2009 period. A survey by Trimtabs shows hedge fund Data. The graph compares BBHFUNDS to m a n a g e r s benchmarks. Hedge Fund Flows, 2009-2010 remain bear-
8.98% 20 ish on equi- 9.0% 8.51% 2010 YTD Return 17.29 ties. That may 7.5% through July 30 15.01 Total Return Since 14.84 6.0% 15 reflect the Aug. 31, 2009 deteriorat- 4.5% 3.44% ing economic 3.0% 10 2.00% 1.5% 1.03% 6.45 landscape and 0.0% 5 4.31 4.68 the reluctance -0.11% -0.83% of hedge funds -1.5% -1.02% 1.32 BBHFUNDS S&P 500 Russell 1000 2-Year Treasuries -2.60 -2.54 -2.86 0 -2.70 to take on risk
AY having only ULY PRIL UNE J M J ARCH A 2009 2010 UGUST CTOBER M
A recently recov- EBRUARY ECEMBER O OVEMBER
-5 ULY F EPTEMBER J D N S ered many of Returns by Strategy Snapshot ANUARY J Monthly Hedge Fund Flows, Flows, Hedge FundMonthly $ Bln by the losses that -10 Strategy % YTD return occurred in Mortgage-backed arbitrage 1.14 2008. -15 Convertible arbitrage 1.05 -14.85 The industry Asset-backed arbitrage 0.98 -18.15 continues to -20 show signs of Capital structure arbitrage 0.77 consolidation. Distressed 0.45 Trimtabs expects August to be a quiet month The funds with more than $5 billion in assets Fixed income arbitrage 0.10 as there are historically very few redemptions have recorded net inflows of $7.7 billion this All funds -0.23 due to seasonality, it said in the report. year, while funds with less than $200 million Global Macro -0.44 "Redemptions should resume in Septem- have seen net losses of $18.3 billion, equiva- Multi-strategy -0.83 ber; historically one of the worst months for lent to 15.7 percent of assets. Merger arbitrage -1.34 hedge fund flows," the report said. For the Market-neutral -2.01 year, flows toward hedge funds stand at $1 Equity statistical arbitrage -2.39 billion, following redemptions of $172 billion in CTA/managed futures -3.45 2009 and $150 billion in 2008. Spotlight Long/Short equities -4.09 "We believe it is safe to assume this “lost” Liam Dalton, CEO and founder of Axiom Fixed income arbitrage -4.19 $320 billion will not come back to the indus- Capital Manage- Short-biased equity -5.24 try any time soon," the report said. Trimtabs' Bloomberg Hedge Fund Indices findings are based on a survey of 954 hedge ment Most recent returns 09.07.10 hedge funds | Bloomberg Brief 2
Performance Snapshot A look at top performers among long/short equities hedge funds. Returns through July 31. Source: Bloomberg Data
By 2010 Year-to-Date Returns inception Firm Fund manager close DAte Return % date BlackRock Advisors Inc/USA OBSIDIAN OFFSHORE FD-III STUART SPODEK 7/15/1996 7/30/2010 16.6 Barnegat Fund Mgmt BARNEGAT INVESTMENTS-B BOB TREUE 1/1/2001 8/31/2010 15.73 III Offshore Advisors III FUND LTD CLIFFORD VINER 7/1/1993 7/30/2010 13.11 Rivoli Fund Management LONG/SHORT BOND-P VINCENT GLEYZE 11/13/2001 9/1/2010 11.31 Rimrock Capital Management HI INCOME PLUS LTD-A DAVE EDINGTON 6/30/2004 7/30/2010 9.41 Capula Investment Mgmt GLOBAL REL VALUE F-A$ YAN HUO 9/30/2005 8/31/2010 8.33 Henderson Global Investors CREDIT OPPTY FD-A$ DANIEL BEHARALL 1/31/2003 7/30/2010 7.08 Pamplona Capital Mgmt CREDIT OPPORTUN-A€ YVES LEYSEN 9/1/2008 7/30/2010 7.02 Mako Investment Managers PELAGUS CAPITAL-USD BRUNO USAI 4/16/2007 7/30/2010 6.96 Thames River Capital Holdings HILLSIDE APEX-A BERNT TALLAKSEN 7/31/1998 7/30/2010 5.75
By Trailling 12-Month Total Returns inception Firm Fund manager close DAte Return % date BlackRock Advisors Inc/USA OBSIDIAN OFFSHORE FD-III STUART SPODEK 7/15/1996 7/30/2010 50.67 Barnegat Fund Mgmt BARNEGAT INVESTMENTS-B BOB TREUE 1/1/2001 8/31/2010 33.09 III Offshore Advisors III FUND LTD CLIFFORD VINER 7/1/1993 7/30/2010 28.23 Rimrock Capital Management HI INCOME PLUS LTD-A DAVE EDINGTON 6/30/2004 7/30/2010 23.34 Pamplona Capital Mgmt CREDIT OPPORTUN-A€ YVES LEYSEN 9/1/2008 7/30/2010 22.02 Henderson Global Investors CREDIT OPPTY FD-A$ DANIEL BEHARALL 1/31/2003 7/30/2010 17.12 Mako Investment Managers PELAGUS CAPITAL-USD BRUNO USAI 4/16/2007 7/30/2010 12.44 Thames River Capital Holdings HILLSIDE APEX-A BERNT TALLAKSEN 7/31/1998 7/30/2010 12.18 Capula Investment Mgmt GLOBAL REL VALUE F-A$ YAN HUO 9/30/2005 8/31/2010 10.57 Sanctum FI LLP FIXED INCOME FUND-B$ JEREMY CORN 8/29/2003 7/30/2010 8.42
By Assets Under Management Assets Inception Firm Fund manager Return % (MILLIONS) DAte Capula Investment Mgmt GLOBAL REL VALUE F-A$ YAN HUO 5,342 9/30/2005 8.33 Aviva Investors Global Srvcs G7 FIXED INCOME CELL-$ SHAHID IKRAM 776 1/30/2004 5.73 Mako Investment Managers PELAGUS CAPITAL-USD BRUNO USAI 766 4/16/2007 6.96 Cura Capital Management FIXED INCOME ARB FUND TOM SCHNEPP 470 12/1/2004 -2.29 Barnegat Fund Management BARNEGAT INVESTMENTS-B BOB TREUE 453 1/1/2001 15.73 BlackRock Advisors Inc/ OBSIDIAN OFFSHORE-III STUART SPODEK 396 7/15/1996 16.6 Pamplona Capital Mgmt CREDIT OPPORTUN-A€ YVES LEYSEN 329 9/1/2008 7.02 Sanctum FI LLP FIXED INCOME FUND-B$ JEREMY CORN 287 8/29/2003 3.98 Concordia Advisors Bermuda G-10 FIXED INC RV ARUN PURI 285 1/30/2004 4.74 Rimrock Capital Management HI INCOME PLUS LTD-A DAVE EDINGTON 120.57 6/30/2004 9.41 09.07.10 hedge funds | Bloomberg Brief 3
The Wire BY BLOOMBERG NEWS
Goldman to Disband The Cayman Islands-based OGI Former Mizuho Traders Principal Strategies Unit Global Macro Fund has a maximum Raise $120 Million Goldman Sachs Group Inc. is shut- capacity of about 60 billion yen ($711 Einoshin Arima and Giselle Leung, ting its principal-strategies business, a million) and around two-thirds of its former proprietary traders at Mizuho group that makes bets with the firm’s investments will be made in the Asia- Securities Co., raised about $120 own capital, to comply with new U.S. Pacific region, according to Takahashi. million for a new hedge fund that will rules aimed at curbing risk, two people —Tomoko Yamazaki and Komaki Ito bet on rising and falling stocks, mostly with knowledge of the decision said. in Japan. The Hareion Fund started The bank plans to hold off on an- Och-Ziff Capital's Assets Sept. 1 with money from institutional nouncing the wind-down while the 65 Rise By $200 Mln investors in Asia, according to Arima, to 70 members of the global unit seek the founder of Hong Kong-based Och-Ziff Capital Management new jobs, the people said, speaking Areion Asset Management Co. The Group LLC said in an SEC filing that anonymously because internal dis- fund, which is able to take up about assets under management rose by cussions are confidential. Some trad- $300 million, won’t accept additional $200 million last month as investors ers and support staff may get roles money for a while to build up perfor- deposited money in its funds. Holdings within the firm, while a team in Asia mance, he said. increased to $26.1 billion as of Sept. 1 may raise money for a new hedge Arima and Leung most recently from $25.9 billion the prior month. fund, the people said. Ed Canaday, a worked at GO-TO-ASIA Investment The firm’s funds, including its main spokesman for Goldman Sachs, said Ltd. in Hong Kong, running GTA OZ Master FUnd, held their value as he couldn’t comment. Atomic Fund, which also employed a the Standard & Poor’s 500 Index fell Earlier plans for most members of long-short strategy investing in Japa- 4.7 percent for the biggest August the Principal Strategies group, led by nese stocks. The Hareion Fund, which Hong Kong-based Morgan Sze, to slump in nine years. — Rob Williams targets an annual return of about 20 leave together and form a hedge fund percent, will invest in about 70 to 100 were shelved, people with knowledge stocks, employing both long-short and of the matter said. Now Sze, 44, may Gartmore Group's event-driven strategies, Arima said. set up a fund with a smaller team fo- Gervais Williams Resigns The fund will also allocate about 5 per- cused on Asia. The team’s members Gartmore Group Ltd. fund manag- cent to 10 percent of its capital to the in New York, led by Bob Howard, are er Gervais Williams has resigned to Asia region and use futures and op- in talks to join another asset-manage- “pursue other interests,” the company tions to hedge, he said. ment firm, according to two people. said in a statement on its website. — Tomoko Yamazaki and Komaki Ito — Christine Harper and Saijel Kishan Adam McConkey, who is a senior in- vestment manager on Gartmore’s U.K. E Fund to Set Up China’s OGI Macro Fund to Dou- smaller companies team, was named First Official Hedge Fund head of the team as a result of Wil- ble Assets to $100 Mln E Fund Management Co., China’s liams’ departure. Williams was also co- The OGI Global Macro Fund, run second-largest asset management manager of the Gartmore Fledgling by former Lehman Brothers Holdings company, plans to start the nation’s Trust Plc. Inc. proprietary trader Allan Bedwick, first officially registered hedge fund -af — Chris Spillane is set to double assets to about $100 ter the securities regulator eased rules million this month after outperform- in July. E Fund, with about 200 billion ing hedge-fund peers globally. With Chilton Hires Gautier As yuan ($29 billion) in assets, will be able money from overseas institutional in- It Makes Europe Push to raise money from high-net-worth vestors, the fund’s assets swelled to Chilton Investment Co. has hired individuals in separate managed ac- $45 million from $15 million when it Frederic Gautier as it seeks to in- counts and use the same investment started last November, according to crease its presence in Europe, the strategies as hedge funds. Naoya Takahashi, head of fund man- Financial Times reported, citing China has expanded money-man- agement at Tokyo-based OGI Capital people familiar with the move that it agement products to meet growing Partners Ltd. didn't identify. demand. Zack Liu, head of quantita- Bedwick’s global macro fund, which Gautier will assume management tive investment at China Southern wagers on trends in stocks, bonds and of the Chilton European equity long/ Fund Management, said his firm is currencies worldwide with a focus on short fund, and also help to refocus working on setting up a similar hedge Asia, returned more than 6 percent investment ideas across Chilton’s ex- fund. China Southern had 180 billion through August on a preliminary ba- isting range of non-European funds, yuan under management as of the end sis, beating the 2.1 percent gain by the the FT said. of March. Eurekahedge Hedge Fund Index. — Victoria Batchelor — Eva Woo 09.07.10 hedge funds | Bloomberg Brief 4
Regulatory/Compliance
■■Investors in J. Ezra Merkin’s declined to comment. Bank of Chicago. Gabriel Capital LP, a feeder fund for Ponzi schemer Bernard Madoff, ■■Regulatory reform of over-the- ■■Naked short sales of shares and were awarded about $12.7 million counter derivatives should open the government bonds may be limited by a panel of arbitrators. Sandal- market to more banks while lower- by European Union proposals that wood Debt Funds A and B claimed ing the swap-trading profits of major say the practices cause a “disorderly that Merkin engaged in common-law dealers, according to Citadel LLC. market and possible systemic risks.” fraud, breach of fiduciary duty and The Dodd-Frank Act, which became Under the proposed rules, traders negligent misrepresentation, accord- law in July, requires most swap would be required to submit proof ing to an award made public in New trades in the $615 trillion OTC de- they can access the underlying York State Supreme Court. Sandal- rivatives market to be processed by security to settle a trade designed to wood has asked a judge to con- clearinghouses in an effort to stem profit from falling prices, according firm the award. NewY ork Attorney systemic risk. With a clearinghouse to a European Commission docu- General Andrew Cuomo has sued on the other side of every trade, ment obtained by Bloomberg News. Merkin and Gabriel, claiming Merkin banks with less capital on their bal- The rules would have to have ap- secretly placed money with Madoff ance sheets should have access to proval of the full commission before in exchange for $470 million in fees. the market previously dominated by being submitted to the Parliament The trustee overseeing the bank- firms such asJPMorgan Chase & and national governments. The rules ruptcy of Bernard L. Madoff Invest- Co., Deutsche Bank AG and Gold- would bring the EU closer to the ment Securities LLC and investors man Sachs Group Inc. “Introducing stance taken by Germany, where also have sued Merkin, who denies competition and transparency will Chancellor Angela Merkel, who wrongdoing. Andrew Levander, an change the business practices of banned some naked short selling in attorney for Merkin, didn’t return a all market participants,” Kenneth Germany in May, called on the com- call seeking comment. Laurence Griffin, founder of Citadel, said at a mission earlier this year to speed up B. Orloff, a Sandalwood attorney, symposium at the Federal Reserve curbs on financial speculation. short interest Highest short ratio for companies in the S&P 500 and Russell 1000 as of Aug. 13
S&P Company SI Ratio 20 Moody’s Corp 19.03 18 Moody's Corp Waste Management Inc 18.97
Cerner Corp 18.08 16 Waste Management Inc Fastenal Co 17.75 14 Mylan Inc/PA 14.44 Cerner Corp M&T Bank Corp 13.25 12 Fastenal Co Roper Industries Inc 12.47 10 Robert Half International Inc 12.21 Mylan Inc/PA Newell Rubbermaid Inc 11.79 InterestRatio PercentageShort 8
Plum Creek Timber Co Inc 11.68 6 05/31 06/15 06/30 07/15 07/30 08/13
Russell 1000 Company SI Ratio 25 IDEXX Laboratories Inc 13.58 Core Laboratories NV Realty Income Corp 13.56 Strayer Education Inc 12.88 20 Greenhill & Co Inc Kirby Corp 11.98 Core Laboratories NV 11.56 Realty Income Corp 15 Education Management Corp 11.48 St Joe Co/The 11.07 St Joe Co/The 10
Flowers Foods Inc 11.03 Ratio PercentageInterest Short WebMD Health Corp 10.23 Jefferies Group Inc
Valley National Bancorp 13.58 5 05/31 06/15 06/30 07/15 07/30 08/13 09.07.10 hedge funds | Bloomberg Brief 5
market calls BY bloomberg news
Michael Burry, the former hedge- arbitrage manager, says emerging of June that equities were a bargain fund manager who predicted the markets and raw materials will drive and then reversed course July 2, housing market’s plunge, said he the nascent M&A boom. “A growing saying he’d cut stock holdings to is investing in farmable land, small share of new deals will be in emerg- about 35 percent of his assets. Three technology companies and gold as he ing markets and involve raw materi- weeks later, he told Bloomberg News hunts original ideas and braces for a als,” the firm predicted in its August that shares made up 7 percent of weaker dollar. “I believe that agricul- letter to investors. “With stronger his Traxis Partners LLC fund as the ture land — productive agricultural growth in emerging markets filling the Standard & Poor’s 500 Index headed land with water on site — will be very coffers of local firms, their appetite for a 6.9 percent July rally. valuable in the future,” Burry, 39, said for adventure in the old world is in a Bloomberg Television interview. returning.” M&A activity may slump Former Lehman Brothers Hold- “I’ve put a good amount of money into as quickly as it surged due to still- ings Inc. proprietary trader Allan that.” Burry, as head of Scion Capital existing economic pressures. “But Bedwick, who now runs the OGI LLC, prodded Wall Street banks in history suggests that once a merger Global Macro Fund, said the Bank early 2005 to create credit-default wave begins, it can grow quickly.” of Japan has not done enough to swaps to bet against bonds backed by spur that country’s economy. The the riskiest home loans. The strategy Barton Biggs said investors should BoJ boosted a bank-loan program by paid off as borrowers defaulted, letting avoid the mistake he made in July, 10 trillion yen to a total of 30 trillion his investors more than quintuple their when he slashed equity holdings in yen Aug. 30, while the government EMERGING MAR EMERGING money from 2000 to 2008, according half before redoubling them. “This unveiled a 920 billion yen stimulus to Michael Lewis’s book “The Big is not a time where you want to package. “The most recent ‘easing’ Short” (Norton/Allen Lane). be underinvested,” Biggs said on they assumed was pathetic and noth- Bloomberg Television. “The odds of ing more than an attempt to keep Bernheim, Dreyfus & Co., a Paris- significant slowdown are one in five, the politicians at bay,” Bedwick told based event-driven and merger pretty remote.” Biggs said at the end Bloomberg News. CONNECT YOU ARE INVITED ECONOMY EMERGING Join us for a stimulating and informative day dedicated exclusively to Emerging Markets. Attend seminars taught by in-house specialists on the latest tools and analytics in MARKETS emerging markets. Then, join Bloomberg’s Tom Keene in a panel discussion: The 800-Pound Dragon in the Room: BOOT CAMP Assessing the Global Balance of Power as China takes Center Stage
Speakers: Elizabeth Economy C.V. Starr Senior Fellow & Director for Asia at CFR
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Wednesday, September 29, 2010 Bloomberg LP EM Boot Camp: 9:30am - 4:00pm 731 Lexington Ave TALK Panel Discussion: 4:30pm - 6:00pm New York To view agenda, http://www.bloomberg.com/promo/Sept/40208365
For questions, email Emily Howells at [email protected] s 09.07.10 hedge funds | Bloomberg Brief 6
13F Forensics: 3G CAPITAL
3G Capital Partners made headlines last week with its $3.3 The hedge fund only reduced five holdings in the sec- billion buyout of Burger King Holdings. With the world’s sec- ond quarter. All five were exits. ond-biggest hamburger chain in its portfolio, the New York- Three of its five largest purchases — Bank of America, based firm replaces two similar holdings — Wendy’s/Arby’s Kraft Foods and Itau Unibanco — were new additions to and Jack In The Box — it exited in the second quarter. the portfolio.
Buys Sells
mkt value % port- mkt value % port- stock increase* Company name folio stock decrease* Company name folio CCE 25.04 Coca-Cola Enterprises 5.48 GIS 55.43 General Mills Inc 0 BAC 21.37 Bank of America 2.08 PBR 49.71 Petrobas SA-ADR 0 LO 5.97 Lorillard Inc. 2.65 WEN 14.30 Wendy’s/Arby’s-A 0 KFT 3.24 Kraft Foods Inc. 0.32 GFA 3.96 Gafisa SA-ADR 0 ITUB 2.72 Itau Unibanc-ADR 0.27 JACK 3.48 Jack In The Box 0
MSFT 2.66 Microsoft Corp 0.26 * $millions C 2.24 Citigroup Inc. 0.22 VAKE 1.26 Vale SA-SP ADR 0.12 ING 0.73 ING Groep-ADR 0.07
* $millions
Sector Specific Aggregate sector-specific portfolio changes from Q1 to Q2.
After selling off its Petrobras and General Mills holdings, 3G Capital is Changes From Last Quarter heavily concentrated in industrial com- panies. Eighty-three percent of its port- Utilities no change folio is invested in CSX Corp., a posi- Telecoms no change tion it didn’t change last quarter. The IT 0.3% sale of Petrobras reduced its energy Financials 2.6% holdings to zero. Health Care no change 3G was not invested in any financial companies in the first quarter. The four Consumer Staples -1.2% acquisitions--Bank of America, Itau Consumer Discretionary -2.0% Unibanco, Citigroup and ING Groep-- Industrials 4.6% bring its portfolio exposure to 0.3 per- Materials 0.1% cent, Bloomberg data show. Energy -4.5%
Type FLNG
over the hedge BY bloomberg news
this guy. You can do so much better by Climate Spectator. Proposition Manager Pushes for than this. Now let me teach you about 23 wants to put the clean energy stocks.’” bill – which includes proposals to More Women CFAs The CFA Institute, a not-for-profit cut emissions, set ambitious renew- association, traces its roots back to able energy targets and regulations, By Shelley Smith the establishment of the Financial and introduce an emissions trading Work in a bar. That was a friend’s Analysts Federation in 1947, accord- scheme – on hold until the state suggestion for Harvard graduate ing to its website. The first examina- unemployment rate betters 5.5 per Sara Grillo after she was laid off from tions were administered in 1963 to cent for four or more quarters. Steyer Lehman Brothers Holdings Inc. in 278 men and 6 women. By 1985 the has reportedly pledged $5 million and 2008. Two years later, the hedge-fund proportion of female CFA holders had will co-chair the campaign committee analyst is campaigning to get more grown to 11 percent, and by 1996, 18 with George Schulz, the Republican women into top financial jobs. percent, according to the Institute’s former secretary of state. Grillo, 32, who co-manages hedge website. fund advisor Diamond Oak Capital One challenge women face in the ■■3G Capital Management LLC Advisors LLC, found herself among finance industry is that people often made headlines last week with its 225,000 unemployed finance workers judge them by their looks, Grillo said. $3.3 billion buyout of Burger King that year as the subprime market “I’m athletic and I eat well and I Holdings. The firm made headlines collapsed. Dismayed by friends’ sug- don’t have any wrinkles or grey hair,” for a different reason earlier this sum- gestions that she quit finance, Grillo she said. “It’s a huge problem in fi- mer when Marc Mezvinsky, one of its vowed to help more women join the nance because I go to these meetings partners, married Chelsea Clinton. industry, setting a goal of raising and I really stand out. It’s difficult for the proportion of women Chartered me to get credibility and to build trust ■■Hedge funds have been a scam Financial Analysts to 50 percent from because I look like a teenage girl.” for the past 20 years, according to the current 19 percent. Grillo’s business partner Eric James Altucher, founder of Formula “If I were a tall, broad shouldered, Hansen established Diamond Oak Capital LP. " Mostly now-illegal or du- gray-haired, 50-year-old man with the in June 2009 to provide customized bious activities are how hedge funds same credentials, nobody would have Fund of Funds analysis. Grillo joined have made almost all of their money suggested I take a job for less than in February. She had planned to start in the past 20 years," Altucher wrote one eighth of my salary,” said Grillo a microcap fund earlier this year, in his blog. He listed strategies such in a telephone interview from her an ambition that had its roots seven as "playing the calendar" (churning home in Queens, New York City. “I’m a years earlier in a jewelry shop. shares in exchange for IPO stock), CFA charterholder and I always look Grillo said she and her boyfriend market timing mutual funds, PIPE women right in the face and tell them were faced with a choice between a strategies and insider information. that if I did it, they can do it as well.” platinum, gold or silver engagement Of the some 90,000 CFA charter ring. He said he didn’t care which ■■Third Point LLC founder Daniel recipients worldwide, 19 percent are one she chose so long as it was the Loeb, who raised money for Barack women, according to CFA Institute cheapest. Grillo did care, so she Obama’s presidential campaign, figures. In the Americas the percent- dumped him and invested the money said moves by the White House to age is 18 percent, while in Europe for the wedding in Commercial Metals increase financial regulation and the proportion falls to 17 percent. Co. a small-cap stock that made her change tax policy are creating “murky Asia-Pacific has the highest ratio at as much as 300 percent in profit. waters” for investors. “This administra- 25 percent. As her career in finance developed, tion is operating from a playbook quite Grillo’s efforts to balance the num- she became determined to gain her different from the one we are used to bers include lobbying and giving moti- CFA to gain credibility and recognition as American business people,” Loeb vational speeches. Her most personal in the industry. wrote in a nine-page letter to clients approach, though, is to mentor 20 “I wanted those letters after my dated Aug. 27, a copy of which was people, some from New York Univer- name so badly,” she said. “If it took me obtained by Bloomberg News. Loeb sity’s Stern School of Business where 80 years, it was going to say, ‘Sara said government actions “seem de- she got her MBA in 2007, or Harvard Grillo, CFA’ on my tombstone.” signed to fracture the populace.” University where she read English Literature, or the New York Society of Also Noted ■■Short-seller Jim Chanos has Security Analysts, the local chapter of donated $50,000 individually and the CFA Institute. ■■California state records show that $16,500 through his firm,Kynikos “One of the women I met on the the major initial funding to the “No Associates, to Eric Dinallo, one of subway in Queens,” Grillo said. “She to Prop 23” campaign is Thomas five Democrat candidates facing off was having a really tough time with a Steyer, the founder of San Francisco- in the Sept. 14 primary for New York guy giving her trouble and I looked at based hedge fund Farallon Capital Attorney General, Legal Newsline her and I said, ‘look, you don’t need Management, according to a report reported 09.07.10 hedge funds | Bloomberg Brief 8
Hedge Funds Added to Bloomberg This Week
The following hedge funds were added to Bloomberg’s database this week. Access the Hedge Fund Database Portal by typing HFND
Manager Inception Ticker bloomberg id Fund Manager Management Company strategy Location Date Prime Broker
ABUNPAR US 000R3PFG5 VLADIMIR EFROS Abundance Partners LLC Long/Short Eq U.S. 7/1/2003 Goldman Sachs ARGWWEQ KY 0015MDDW5 D. GERSTENHABER Argonaut Management LP Long/Short Eq U.S. 1/1/2008 Morgan Stanley ARTOROS KY 000R08G78 RICHARD FURLAUD JR Artorius Management LLC Market Netrual Equities U.S. 3/1/2009 JPMorgan Chase BBTOPRA KY 0015F6BR8 MICHEL KEUSCH Bellevue Asset Management Market Netrual Equities Switz. 9/1/2007 Goldman Sachs TCGINST KY 0015GN545 V. KRISHNA-KUMAR CAMS LLC Long/Short Eq U.S. 4/12/2005 Merrill Lynch THINKGL KY 0014J72Y2 ZHOU CHAO Capital Focus Asset Mgmt CTA/Managed Futures HK 9/1/2009 N/A LAKEPAR US 000NQNMD8 EDWARD MATUSZAK Capitalworks LLC Long/Short Eq U.S. 3/1/2005 BNP Paribas CELFIA1 KY 0014XQLK3 ANTOINE SCHETRITT Cello Capital Management Asset Backed U.S. 1/1/2010 US Bank Association COLGLMA ID 0015KFH76 SIMON COLLARD Collard Capital SA Global Macro Switz. 9/1/2010 Saxo Bank A/S SAGLMAA KY 0014LYYV0 SAMI ROBBANA Credit Suisse Global Macro U.S. 6/30/2009 N/A RUSSSIT KY 0015GNQD9 STEVEN DASHEVSKY D&P Investment Management Multi-Strategy Russia 12/31/2009 Citigroup FLFIALP KY 0015CGPT1 ALPHONSE FLETCHER Fletcher Asset Management Fixed Income U.S. 5/31/2007 N/A INFINGL KY 0014KNRZ5 KALYTA ANDRIY IB Finance LLP Multi-Strategy Austria 7/1/2010 Deutsche Bank INVABCJ LX 0015F8RT9 ALEX. UHLMANN Invesco Management SA Multi-Strategy U.K. 9/15/2010 Bank of New York Mellon KEYREOH US 000QX2YY4 ROD HINZE KeyPoint Capital Mgmt Long/Short Eq U.S. 1/1/2009 Goldman Sachs LEOPPEB ID 0015P3002 FEDERICO GHELLA Leo Fund Managers Ltd Multi-Strategy U.K. 8/8/2010 NCB Stockbrokers Ltd MWDETEE ID 0015QY5D1 IAN WACE Marshall Wace LLP Long/Short Eq U.K. 9/1/2010 Deutsche Bank MERCEAR ID 0014SSG32 JOE O'DWYER Merrion Capital Investment Long/Short Eq Ireland 6/30/2010 N/A SIXMASS LX 0015CHP92 M. LEZIUS-DONCEL Natixis Alternative Investments Long/Short Eq France 9/1/2010 N/A NESHAVU ID 0015KHNL5 DANIEL MANTINI Nexar Fund Management Ltd Short-Biased Equities France 8/27/2010 Bank One NA NUBAFMS KY 0014SLJK4 PETER ENTI Nubuke Investments LLP Multi-Strategy U.K. 6/1/2008 UBS AG PANGLLT KY 0015S4NK3 HANS HAYWOOD Panda Global Advisors LLC Global Macro U.S. 4/1/2010 Newedge Group PASCSP5 US 0015MF2B0 B. PASKEWITZ Paskewitz Asset Management CTA/Managed Futures U.S. 12/1/2003 N/A TCAGLCR KY 000BGHP70 ROBERT PRESS Trafalgar Capital Advisors LLC Fixed Income U.K. 4/1/2010 N/A VECOPA1 KY 0014FGB16 BARRY J O'CONNELL Vega Fund Holdings Fixed Income Spain 8/1/2009 N/A WBLSLTD VI 0015HZJL1 ROB VOGEL Whitebox Advisors LLC Long/Short Eq U.S. 6/1/2004 BNP Paribas YEOFADV KY 0015F9LZ4 A. GOODFRIEND Yedid Capital Mgmt Market Netrual Equities U.S. 11/1/2007 Goldman Sachs 09.07.10 hedge funds | Bloomberg Brief 9
Calendar daTe event featuring location contact / registration Sept. 14 Hedge Fund Association’s Golf & Tennis Championship “This popular event includes networking, cocktails, hors Doral Arrowwood, Rye thehfa.org New York d’oeuvres and now tennis.” Brook, N.Y. Sept. 14 100 Women in Hedge Funds Education Session An Evening with Industry Icon Jim Mellon “Atlantic House, Hol- 100womeninhedge- born Viaduct London” funds.org Sept. 14 Capital Markets Consortium’s State of the Hedge Fund Moderated by former NBC News anchor John Seigenthaler. One Hanover Square, 973-710-1536 Industry Speakers include Simon Fludgate, Aksia; Joe Gieger, GAM New York. USA; Alan Glatt, Protocol Capital Management. Sept. 16 Hedge Funds Care’s 2nd Annual Cocktails on the Sound Hedge Funds Care invites you to join us for our 2nd Annual WR Capital, 40 Signal Sarah Blaker, 212-991- Connecticut event, Cocktails on the Sound, hosted by WR Road, Stamford, Conn. 9600 x 342, sblaker@ Capital. hedgefundscare.org Sept. 16 100 Women in Hedge Funds Senior Practitioner Event: Speakers Sebastian Mallaby and Robert Rubin Yale Club, New York 100womeninhedge- The History of Hedge Funds funds.org Sept. 21 Bloomberg Panel Discussion: Effects of the Dodd-Frank George Canellos, SEC; Michael Litt, Arrowhawk Capital Bloomberg Headquar- Jeff Volpi, 212-617-3766, Act on the Hedge Fund Industry Partners; Ron Geffner, Sadis & Goldberg. ters, 731 Lexington [email protected] Ave., New York Sept. Information Management Network’s 8th Annual Alterna- Conference co-chairs Jaeson Dubrovay, Aksia, and Cynthia Park Hyatt Aviara imn.org 21-22 tive Investments Summit Collins, Delaware Public Employees’ Retirement System. Resort, San Diego. Sept. 22 New York Hedge Fund Roundtable Pete Dawkins, Flintlock Capital Asset Management. Sept. 22 100 Women in Hedge Funds Geneva Gala Charity Gala in aid of Solidarité Femmes (Women Supporting Four Seasons Hotel des 100womeninhedge- Women). Bergues, Geneva funds.org Sept. 23 No Greater Sacrifice Inaugural New York Dinner Honorees Lt. Gen. John F. Mulholland Jr. U.S. Army; Becky Gotham Hall, New York nogreatersacrifice.org, Quick, CNBC; Laurence Fink, BlackRock; Robert McCann, 202-337-3876 UBS. Sept. Alpha Hedge Institutional Investor Conference Keynote speakers Jane Buchan, Pacific Alternative Asset Ritz Carlton, San ii-alphahedge.com 26-28 Management; Arnab Das, Roubini Global Economics; Kurt Francisco Silberstein, CALPERS. Sept. 29 First Annual Bloomberg Emerging Markets Boot Camp Elizabeth Economy, CFT; Stephen Roach, Morgan Stanley; Bloomberg Headquar- Emily Howells, 212- Alan Rushkin, Deutsche Bank. ters, 731 Lexington 617-3497, ehowells@ Ave., New York bloomberg.net. BU
the dividend and hope for divi- A: Investors are requiring a higher spotlight dend growth? level of transparency, a higher level A: To tell you the truth, there are of liquidity. It’s all a result of the after- worse strategies out there at the math of the experiences of the past few years, and with net returns over Liam Dalton, CEO and founder moment. What I think we’re watch- the last decade being subpar. of Axiom Capital Management, ing is markets are gravitating to a I don’t think it’s going to be unman- discusses the U.S. economic slow- world in which we’re having sort of ageable. Frankly, it used to be that down on Bloomberg Surveillance deflationary indications, if not outright the managers were really in control with Tom Keene and Ken Prewitt. He deflation. And stocks within the uni- of the structural dynamics of the explains why current market condi- verse of equities, which I watch, are industry. And I think that relationship tions aren't favorable for a large basically acting as though the ones has now shifted, and that the investor number of hedge funds and talks that are going to be rewarded best base is now firmly in control of the about the changing dynamic be- are the companies that are either terms under which they’ll give capital tween investors and fund managers. self-generating cash flow entities or things that can protect their cash flow to outside managers. That process at a disinflationary environment. is unfortunately, possibly right now, As a result, some of the higher- swinging a bit too far. The pendulum yielding names have been the rela- likely flows a little bit backward to- Q: I want to talk about some tive winners in the market. And the wards equilibrium, where we can see of the reporting that I really things that have been most sensitive a better balance of power. But the thought was off the mark about to economic activity and consumer investor is in control right now. hedge funds having a tough activity have been the worst. time. Did Mr. Druckenmiller (This interview was edited and condensed.) and Mr. Pellegrini throw in the Q: There was a long time when towel because they were losing nobody much paid attention money, or is it because if you’re to dividends. going to do a hedge fund, you’ve A: That’s true, because we had a got to make a certain amount to world in which there was an under- Bloomberg Brief Hedge Funds make the 2/20 payout? Bloomberg LP lying growth dynamic providing for 731 Lexington Avenue, New York, NY 10022 A: Listen, those two guys aren’t guys to basically run stocks. Over the 212-318-2000 exactly battling for their survival. past few decades we’ve rolled from Newsletter Ted Merz They’ve done incredibly well over growth industry to growth industry, Executive Editor [email protected] time, and so they’re proven entities. whether it be technology, more 212-617-2309 I think it just happens to be that they recently energy. So now we seem Bloomberg News Rob Urban decided that it was time to go to the to be at a point where there’s really Managing Editor [email protected] beach, so to speak. no high-quality source of growth for 212-617-5192 On the other hand, there is no the aggregate economy. As a result, doubt that a lot of the market condi- dividends become a much more Hedge Funds Nathaniel E. Baker Editor [email protected] tions we’re confronted with now are interesting feature to the equity stuff, 212-617-2741 not particularly well-suited to a wide because we’re seeing actually a swath of the hedge fund industry. strange dichotomy in that convention- Contributing Katherine Burton The equity world is faced with a al thinking believes that when interest Reporters [email protected] market that is having very, very wide rates are low and valuations are low, 212-617-2335 swings in price action. It’s a long- bi- you simply buy stocks. Saijel Kishan ased industry. I see it a little differently. I see the [email protected] When we get this kind of price fact that these equities have retreat- 212-617-6662 action, it’s very difficult to get on ed down to rather low valuations as longer-duration positions and hold sort of a validation of the slow growth Contributing Matthew Kelly Data Editors [email protected] them. And the same goes for the environment we’re going into, and 609-279-5064 trending world and the macro world. that the yield portion of equities is re- I mean, these are momentum-driv- ally the protective feature that people Anibal Arrascue en strategies that are not well tuned should be looking for. [email protected] 609-279-5084 to this kind of choppy price action. As a result, returns have been Q: Investors really want a lot more To subscribe via the Bloomberg professional rather anemic. information from managers Is it go- terminal type BRIEF