Tue, Aug 4, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Poorly performing hedge fund face with liquidations and restructurings

Monday, June 20, 2011

Nigel Sidebottom
Opalesque Industry Update – Hedge funds that have been underperforming the last couple of years are facing liquidation. Most of these are investment trust hedge funds that were launched as absolute return strategies and that have failed to deliver their promised alphas.

A report has quoted Numis Securities, which said that the decision to liquidate underperforming hedge funds should be expected.

Numis said, “Numerous listed funds of hedge funds have wound up over the past few years and we believe that further consolidation is needed. In addition, listed funds are facing increased competition from UCITs funds, especially in long/short equity strategies.”

Investors are now heading towards open-ended funds under the European UCITS III director where they can move their money more frequently and the risk of discounts is nil. Nigel Sidebottom, the deputy chief investment officer at Premier Asset Management and the manager of the Premier Enterprise fund, commented that many investors have lost money from poorly performing hedge funds.

Amongst those facing liquidation is Cazenove Absolute Equity, the board of which will vote this week to determine if the fund will continue operating under its present set up. Cazenove’s board is proposing a change in its investment policy. Performance plunged in 2009 and 2010 and it has lagged its counterparts.

It was also reported in April that Trafalgar Asset Management is liquidating its flagship fund, the Trafalgar Catalyst fund as a result of "material" investor redemption requests.

According to Fund Web, shareholders of Dexion Equity Alternatives voted last week to restructure the fund and change the trust’s investment policy from a global fund of hedge funds to a hedge fund focused in American equity long/short hedge funds.
Precy Dumlao

What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Other Voices: Same day reporting and the evolving role of fund administrators[more]

    By: Scott Price, Head of Business Development and Client Management for North America, Maitland Ernst & Young’s latest glob

  2. Activist News - Celgene says patent-fighting hedge fund manager wants to short its shares[more]

    From Reuters.com: Celgene Corp, one of the world's largest biotechnology companies, has accused U.S. hedge fund manager Kyle Bass of attempting to profit from his attempts to wipe out several major drug patents through his Coalition for Affordable Drugs. The company asked the U.S. Patent and T

  3. Einhorn's Greenlight Capital hedge fund slumps 6.1 percent in July[more]

    From Reuters/Thefiscaltimes.com: Hedge fund mogul David Einhorn's Greenlight Capital slumped 6.1 percent in July and is now down 9 percent for the year after gold, one of the fund's top holdings, tumbled to five-year lows last week. Greenlight notified clients of its returns late on Friday, ac

  4. Cowen Group, Inc. to acquire Conifer Securities[more]

    Cowen Group, Inc. and Conifer Securities, LLC had announced the signing of a definitive agreement under which Cowen will acquire Conifer Securities, the prime services division of Conifer Financial Services LLC. The transaction, the terms of which have not yet been disclosed, was approved by the boa

  5. Cargill’s Black River Asset to shut down four hedge funds[more]

    Komfie Manalo, Opalesque Asia: Cargill Inc.’s $7.4 billion Black River Asset Management said it was closing four hedge funds with a combined $ 1 billion in assets and start returning investors money over the next several months, various media said. The hedge funds represent 15% of Black River’

 

banner