Trimming the hedge funds

September 16, 2014

The California Public Employees Retirement System is getting out of hedge funds. Calpers’ decision to divest the $4 billion it had in hedge funds (of about $300 billion total) isn’t exactly a surprise, since members of the organization openly expressed doubts about the investment strategy last year. But Calpers’ reputation as the gold standard among public-employee pension funds may portend changes in the way smaller pension funds invest their money.

MORNING BID – I was dreaming when I wrote this…

August 25, 2014

The move by Roche to buy biotech company Intermune for $8.3 billion at a 38 percent premium isn’t going to make Janet Yellen happy, given her thoughts on the valuation of certain biotechnology and Internet retailing names. Still, with the Fed chair on board for low rates for some time given the slack situation in the labor market that the Fedsters keep talking about (basically, the unemployment rate, like the old grey mare, ain’t what she used to be), the long march to 2,000 on the S&P looks like it’s probably going to be over before long (it’s been done on an intraday basis, and now we’re just waiting on a close above that level), representing a tripling in that average in a bit more than five years and raising again all those questions about whether this all makes sense and if anyone cares anyway.

MORNING BID – Two to Tango

June 25, 2014

Wednesday’s version of reading tea leaves involves Argentina’s economy minister Axel Kicillof, who will be in New York to speak to the United Nations about Argentina’s debt situation. In case the U.N. missed it, Argentina defaulted a while back – 12 years ago – and they’ve been fighting with a group of investors on paying some of their debt since. Which is a roundabout way of saying Kicillof may not just be in New York to talk to the U.N., not when NML, Aurelius and the other holders are all also in New York too, and the judge in question, and any special envoy he introduces to try to wring some kind of compromise out of this situation. There’s a big coupon payment due June 30, and the country has been prohibited from doing so unless it pays the holdouts, which it has pledged not to do, giving it a 30-day grace period before being declared in default.

MORNING BID: Mo-Mo and the Hedge Fund Reckoning

May 15, 2014

Who had the mo-mo mojo and who was crushed by the steamroller becomes evident late in the day Thursday when filings from major hedge fund managers – those things known as 13-Fs – are released.

MORNING BID – Momentum stocks: A primer

April 7, 2014

Lots of stocks have been getting killed in the last several weeks and the declines don’t seem really like they’re set to abate headed into a week where news is again at a premium (sure, earnings, but it’s just a few names, and they’re mostly decidedly not in this category of the momentum names that fueled the rally in 2013). So the likes of Facebook, Tesla Motors, Netflix, Alexion Pharmaceuticals, and a bunch of others have seen their fortunes turn in the market. But at this time we thought it would be a good way to get into this topic again by trying to lay out just what the hell a momentum stock is in the first place, because they exhibit a number of characteristics beyond just “a stock that’s going up very high.” So here goes:

Can Mathew Martoma accept money from Steve Cohen?

January 7, 2014

DealBook’s Matthew Goldstein and Ben Protess report that “prosecutors never thought their insider trading case against Mathew Martoma would go to trial… [He] appeared to have every incentive to cut a deal against a boss who fired him in 2010”. Martoma, a former analyst at SAC Capital now facing federal insider trading charges, seemed to have plenty of incentives to cooperate with authorities: a solid case against him, a wife and three children, and the possibility of a decades-long prison stay ahead of him.