Funds Hub

Money managers under the microscope

Utilities vs banks: The evidence

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Alpesh Patel caused quite a stir on Britain’s Radio 4 this morning. The CEO of boutique investment house Praefinium Partners argued that Bob Diamond was on “a suicide mission to bring down capitalism”. No word yet from the Barclays CEO on that one.

Maybe that was just the line his PRs had promised to the BBC producers to get him on air, though, and there is more logic to Patel’s more substantial point about value creation in the banking sector in relation to bonuses and pay.

“What concerns me is higher salaries for what? In 14 years they have managed to add absolutely zero to the share price of Barclays… you’d think someone in banking would know which direction a share price is supposed to go in.”

Perhaps Patel’s most enticing comment was to suggest that utilities CEOs would make better banking executives, saying that Diamond should call on BG Group’s boss Frank Chapman to step in “to run [the] business properly and help those share prices go in the right direction because it helps pensioners and it helps consumers who might be shareholders.”  

So just how well are those utilities chiefs doing against the.. err… morally-complex banking execs? One of our graphics gurus has knocked up the below to show how total returns match up in a few sectors. Draw your own conclusions.

Morning Line-up: FandC’s errant investor and SEC muscle flexing

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RTR1SGF8 News and views on the asset management industry from Reuters and elsewhere:

SEC sues ex Trivium fund manager – Reuters

F&C hit by rebel shareholder concerns - Independent

Hedge funds kept taking in money at end 2010 – Reuters

Morning Line-up: Call to rein in hedgies and more Goldman vets go it alone

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RTR1SGF8News and views on the asset management industry from Reuters and elsewhere:

More Goldman traders leave to start fund – Financial Times

Carlesberg chief calls for hedge fund crackdown – Daily Telegraph

Profitability at asset managers rises - Fund Strategy

Man and AHL

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Rightly or wrongly, the short-term performance of Man Group’s largest fund, AHL, has been closely watched by Man investors as an indicator of the firm’s fortunes.

However, according to a Numis note this week, the fact that AHL is so close to its high-water mark (the point above which a fund can earn performance fees) at the moment gives it extra weight.

Morning Line-Up: FrontPoint, Kotak, Paulson

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News and views on the asset management industry from Reuters and elsewhere:

FrontPoint raises $1 bln for new fund – FT

Kotak launches India long/short hedge fund – Reuters

Prime Cap doubles China fund, closes to new investors – Reuters

Another good year for the closed-end fund sector – Hemscott

Late gains let Paulson funds race ahead in 2010 – Reuters

Morning Line-Up: Thoroughbred, fees, fixed-income funds

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News and views on the asset management industry from Reuters and elsewhere:

Investors in Thoroughbred fund granted early exit – NY Times

Yes, you can lose money in fixed-income funds – WSJ

Who’s who in the latest insider trading arrests – Reuters

The incredible shrinking fee – WSJ

Smaller hedge funds to enjoy inflows – Financial News

How to make money in 2011 – Daily Mail

Morning Line-Up: 2010 returns, expert networks, ETFs

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News and views on the asset management industry from Reuters and elsewhere:

Hedge funds offered weak returns in 2010 – Reuters

Hedge fund scandal shakes expert network industry – International Business Times

Morning Line-Up: insider trading, BP, 2011 outlook

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News and views on the asset management industry from Reuters and elsewhere:

Insider trading defendants in prime time to deal – Reuters

U.S. pension funds prepare to sue BP over oil spill – Telegraph

Year-end planning: the 2011 fund outlook – Reuters

ICI: Long-term mutual funds rose $1.8bln in latest week – WSJ

Morning Line-Up: BlackRock bullish, IPOs, Tower Australia

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News and views on the asset management industry from Reuters and elsewhere:

BlackRock founder upbeat on growth potential – FT

Institutional investors to shun high-price IPOs – Times

Australia’s Tower  accepts Dai-ichi’s $1.2 bln bid – Reuters

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