Funds Hub

Money managers under the microscope

Can Ucits help the struggling fund of hedge funds industry?

Funds of hedge funds have had a hard time since the onset of the credit crisis, what with the Madoff scandal, widespread gating and sidepockets and underperformance versus single-manager hedge funds in 2008 and 2009.

However, Ucits — onshore funds viewed as more transparent and more liquid — have been widely seen as a fresh injection of capital into the hedge fund industry and could prove a much-needed boost for funds of funds looking for a new client base to tap.

RAB on the way back up

A positive trading update and finally a rise in assets from RAB Capital this morning shows that even hedge fund firms badly hit by the credit crisis are on the way back up.

RTXR8CZThe firm, whose assets stood at more than $7 bln two years ago - but later saw them slump due to outflows and performance losses -  saw a recovery in H2 of $100 mln to $1.37 bln.

Through a glass darkly


The fund of hedge funds concept took a serious knock last year with Bernard Madoff’s $65 billion fraud, leading high net worth investors to pull out money over concerns that the due diligence hadn’t been quite as diligent as one would hope.

Even managers who weren’t exposed to Madoff had to calm client fears. This has prompted the bigger, more institutional groups to seek ways of gaining more control over assets that the underlying managers are running.

Madoff blow for funds of hedge funds


Today’s update by S&P Fund Services on its ratings for seven funds with exposure to Bernard Madoff’s fraud shows just what a blow to the fund of hedge funds industry the scandal has been.

rtxcojvS&P said that five funds of hedge funds that invested in Madoff and whose ratings it placed under review in December when the scandal broke have now been downgraded to “not rated” — Bonhote Alternative Multi-Arbitrage,  DGC Pendulum, Dinvest Concentrated Opportunities, Dinvest Total Return and RMF Four Seasons.

Regrets, I’ve had a few


Crosby Asset Management’s high-profile deal to buy up funds from collapsed asset manager Forsyth Partners in 2007 just looks worse and worse.

rtr226yxCrosby today said that after further demands by clients to withdraw cash it would scrap plans to merge and remarket Forsyth’s funds of hedge funds and instead shut them.

Finding a buyer


Another day and another report of a company looking to exit its hedge fund operation.

rtr237ljAccording to a report in today’s FT, Germany’s Commerzbank has put its $900 million fund of hedge fund manager Comas up for sale, although it may close it down if no buyer is found.

Going global


rtr1u4b7Global macro and managed futures (CTAs) are still where it’s at, it seems, when it comes to funds of hedge funds.

Nigel Davies’ poll of portfolio managers shows these are the two strategies they are expecting above average returns from in the first half of 2009.