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Money managers under the microscope

Short and Curlies

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The Longpigs were one of the lesser lights of Britpop, best known for a number 16 hit with She Said and for launching the career of Richard Hawley. Now though, apparently, short pigs are all the rage.

RoastingNews reaches us of exciting developments in the world of ETFs where the market is seeking out ways to play swine flu. ETF Securities has seen a surge in volumes and returns of its Short Lean Hogs ETC after the World Health Organisation (WHO) raised its pandemic alert for swine flu to the second highest level last Wednesday.

No word on Short Fat Hogs, but we are reliably informed that the surge in short interest in their slimline cousins has put them in the top 5 of short ETC’s by returns in the year to date. The porkers must be feeling particularly perky at outperforming the MSCI World by some 74 percent since September last year.

ETF Securities reckons the interest shows investors are using Short ETCs to benefit from an anticipated fall in demand for lean hogs on the swine flu outbreak. It notes that U.S. pork import bans have been enacted by Russia, China, the Philippines, Serbia, Kazakhstan and South Korea since the end of last week — while lean hog prices have seen sustained pressure as farmers have culled pigs, increasing supply as high feed costs and falling returns have pressured margins.  

Time for a Horlick’s

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- Famed City ‘superwoman’ nicola Horlick is facing a tough fight to save her reputation after a move from the largest investor in her Bramdean Alternatives vehicle, property tycoon Vincent Tchenguiz, which could lead to her being ousted as investment manager.

Horlick, who once refused to hand over her valuable to a robber holding her at gun point, has already hit back at Tchenguiz. Bramdean Alternatives issued a letter on Thursday challenging him to substantiate his claims alongside a warnings that issuing misleading statements is an offence under the Financial Services and Markets Act.

Draft chills hedgies

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The horse-trading is over (for now) and the EU has published its draft directive on regulation for the hedge fund and private equity industries. EU commissioner Charlie McCreevy must be doing something right as his plans have angered parties on both sides of the fence.

EU FlagThe Alternative Investment Management Association is furious after claiming political manouevering has riddden roughshod over its own efforts to drive a “proportionate”  industry-led solution which promised increased transparency. The Party of European Socialists (PES), meanwhile, appears equally frustrated.

It just gets worse for funds of hedge funds

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rtr23yfgFunds of hedge funds are taking a greater share of the pain in the industry’s downturn.

Even as overall outflows from hedge funds slow, redemptions from fund of hedge funds are accelerating. 

Banks’ pain could be hedge funds’ gain

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The seemingly endless drama of financial regulation has frequently fixed the spotlight on hedge funds, but there could yet be a twist in the tale.

rtr1oo4sAt a breakfast briefing this morning at the City of London’s plush Capital Club, law firm Katten Muchin Rosenman Cornish suggested the beleaguered hedge fund industry could even benefit from tighter rules.

‘High-handed’ hedgies face boycott

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BNY Mellon’s look at the “Hedge Fund of Tomorrow” has gained some column inches for its confirmation that wealthy Europeans have proven decidedly disloyal to the hedge funds who lined their pockets during the good times.

Rapid exits from European HNWs have apparently created an industry which is more American, and more institutional. BNY Mellon and research firm Casey Quirk expect assets to recover, and more than double within 4 years. Small beer given previous growth rates, but beggars can’t be choosers.

Little and large

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The challenges of volatile markets and client redemptions are finally driving the consolidation in the hedge fund sector that some commentators have been expecting.

rtxccu6Yesterday it was announced that hedge fund firm Cheyne Capital would buy fund of hedge funds firm Altedge Capital, a smaller boutique, and appoint Altedge CEO and CIO Chris Goekjian as partner and CIO.

Odey backs the bull case

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Plenty of fund managers have been predicting a rally in stock markets after the sharp drops seen last year and early this year, but most have expected it to be no more than a bear market rally.

rtr22ooyHowever Crispin Odey, one of the UK’s best known hedge fund managers with a pay packet to match, has stuck his head above the parapet and said he thinks the recent rebound in stock markets could be the start of the next bull market.

A kick up the…

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It seems the UK Treasury Select Committee’s very public chastisement of the hedge fund industry in January has had some effect.

rtrxsy1At the time, MPs zeroed in on the Hedge Fund Standards Board (HFSB) in particular and the relatively small number of funds it had signed up — 33 in December — even though these funds accounted for half of the European industry.

Madoff blow for funds of hedge funds

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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.

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