In the week ending 23 January, 2015, in the ongoing Swiss franc saga, Marko Dimitrijevic said he was closing his largest hedge fund, the Everest Global Fund, after losing virtually all its money due to the Swiss franc rally; the markets braced for more losses at financial firms from the Swiss sudden move; the John Hancock Absolute Return Currency Fund lost 8.7% because of the Swiss franc turmoil; the Swiss franc remained pinned at sky-high levels, hovering around one-to-one against the euro; Pepperstone Financial Services said that it was considering bailing out Swiss-FX casualty Alpari; Lyxor AM expected CTAs to post moderate gains on the SNB decision; BlueCrest Capital and Comac Capital sustained significant losses from the surge in Swiss franc’s value; Fortress Investment's macro hedge fund lost 7.64% on the back of the Swiss move; and Brevan Howard survived last week’s currency market turmoil unscathed after cutting back a negative bet on the Swiss franc.
Douglas Braunstein and James Woolery are launching an activist hedge fund with a collaborative approach to management; Warren Ashenmil launched his own hedge fund called Jerica Capital Management; Chris Rokos will start his own hedge fund with the backing of his former employer, Brevan Howard; Anil Prasad is readying to launch his own macro hedge fund called Silver Ridge Asset Management with $500m in assets; Newalpha AM raised $250m in seed capital for a long-only strategy hedge fund; a new hedge fund with Duke University roots called Cresciente Global has closed on $7.5m; Gabriel Plotkin raised about $700m for his new hedge fund; and Nuveen Investments has launched a UCITS-compliant version of Bob Doll’s large cap equity strategy.
The EU will launch a new long term investment fund vehicles for retail and professional investors in 2016.
The Barclay Hedge Fund Index was down 0.18% in December (+3.16% 2014);
The Barclay CTA Index gained 7.71% in 2014;
And the Wilshire Liquid Alternative Index family outperforms investable hedge fund index counterparts in 2014.
Pacific Capital Advisors’ managed futures program Terra Ag posted positive performance in 2014 with 43% returns; Boaz Weinstein’s Saba Capital lost 11% last year; Qbasis Invest ended the year 2014 in positive territory up +41.8%; Todd Edgar’s Atreaus Capital rose 10% as the currency and commodities hedge fund speculated that the euro would tumble; Lynx Asset said the recent surge in market volatility has driven its best performance since it was created 16 years ago; fund of hedge funds ALTIN AG posted a positive year in 2014 with 5.75% gains; Bridgewater Associates’ key All Weather fund finished in solid positive territory in 2014, returning 8.6% net of fees; Guard Capital has gained 2.5% so far in January; Stanley Fink’s ISAM gained 7% a day the Swiss removed franc cap; and Windsor Capital beat most of its peers in performance.
Investors increased their allocations to hedge funds with $76.4bn in new assets in 2014; eVestment said 2014 was the best year for hedge funds as assets near $3tln; the total alternative assets held by hedge fund, private equity, private debt, real estate and infrastructure fund managers reached $6.9tln in 2014; Goldman Sachs reported $1.027tln in assets under management for its Goldman Sachs Asset Management and wealth management businesses; John Paulson’s hedge fund lost $1.3bn in assets; Owen L told investors he was “truly sorry” for blowing up $100m of hedge fund’s assets; SS&C GlobeOp said that hedge fund exit requests hit two-year low in January; and IndexIQ saw ETFs asset rise 46% to over $1.6bn in 2014.
Among investments, Eton Park Capital said it was now ready to pick through the debt of beaten-up energy companies; Oaktree Capital increased its stake in Star Bulk Carriers to 51.9%; macro hedge fund managers are seeking a return of volatility; David Einhorn disclosed a new position in Time Warner; Canyon Partners is paring its bullish investments in the mortgage-bond market; and hedge funds have limited their exposure to stocks and are anticipating a correction.
In other miscellaneous hedge fund news a writing software called Quill is taking over jobs of journalists and may also relieve analysts and fund managers; some 39 hedge-fund managers made Forbes’ just-released billionaire list for 2014; and Peppercomm said hedge funds are testing the social media waters for transparency.
A survey of hedge fund managers found that a majority of them believe that the Feds would maintain an accommodative stance in 2015; and a new study by Dr. Roy Zuckerman found that ‘trustworthy’ hedge fund managers attract more business but provide weaker returns.
Among outlooks, fund managers see oil to slide further but warned On the M&A scene, John Paulson dedicated $7bn of his assets into mergers and acquisitions in 2014.
Institutional investor Cornwall Pension Fund has appointed Man FRM to manage a £120m allocation; Calpers is slashing the number of private equity managers it uses and teaming up with other investors to drive down fees; the New Zealand $21bn state pension trimmed positions as it sees more threats than opportunities; the Arizona Public Safety Personnel Retirement System, Phoenix, approved a total of up to $458m in commitments to five hedge fund managers; and Chicago Park Employees' Annuity & Benefit Fund terminated hedge fund-of-funds manager K2 Advisors.
In Europe, Capula Investment and Sloane Robinson gave multi-million-pound payouts to their staff last year; Denmark sent hedge funds and other speculators a clear message and said it would dump the kroner to tame them; Stephen Schwarzman said European Central Bank President Mario Draghi’s plan to buy government bonds to stimulate inflation.
In South Africa, high net worth individuals are key driver for small and new South African hedge funds.
In Asia, hedge funds in China are increasingly felt across the globe.
On the regulatory front, the Association of Luxembourg Funds Industry is confident UCITs product will be permitted into the pending mutual recognition scheme.
On the legal scene; Jonathan D
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