Funds Hub

Money managers under the microscope

Mutual funds gaining ground on hedge funds?

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rtr9urwHedge funds have gained a increasing share of the investment pie in recent years but the trend could could be reversing, judging by separate comments made by UBS and Deutsche Bank on Tuesday.

Timothy Bell, global head of hedge funds advisory at UBS Wealth Management, said hedge fund assets could fall further to $1.2 trillion this quarter from $1.4 trillion at the end of 2008 and $1.93 trillion at their peak in mid-2008.

At the same time, Deutsche Bank’s DWS unit said it saw inflows into its Asian mutual funds in the first six weeks of 2009.

Staying positive

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rtr23yfeThere seems to be an endless wave of bad news hitting the hedge fund industry at the moment — gates and suspensions, record poor performance, the Bernard Madoff scandal and so forth – but there are still one or two reasons to be positive.

According to a survey of institutional investors by alternative assets data group Preqin, conducted in January (and therefore after the alleged Madoff fraud came to light), only 8 percent said they were no longer confident about hedge funds and would reduce investments.

Great expectations

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It was the outcome most commentators were expecting.

rtx9j4vEven Roger Lawson of the UK Shareholders’ Association, which represented 150,000 small investors, admitted it was “not totally unexpected”.

But the defeat for hedge funds RAB Capital and SRM Global and other former shareholders claiming damages for the loss of their holdings in Northern Rock when it was nationalised last year is nevertheless a hard blow to bear.

Hope springs eternal – time to plant a hedge?

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By Alexander Smith

 

If redemptions are getting the better of you and you thought your industry was about to disappear, you may be amazed to hear there are still those wanting to start their own hedge funds.

rtx5napAn email from Financial Technologies Forum LLC brings news of a new course in New York next month giving you everything you need to get going.

Je ne regrette rien

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Schroders today reported exceptional losses of 167 million pounds — this was largely due to 147 million of writedowns on its own investments in hedge funds, private equity, fixed income and seed capital.

Analysts at UBS noted that these four areas had total investments of 585 million pounds at September 30, meaning the group had taken a 25 percent writedown.

Light at the end of the tunnel?

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rtxb5afThere’s no shortage of bad news in the financial world at the moment.

But one top hedge fund manager believes that equities could soon be heading for a very sharp rally.

Cazenove’s Neil Pegrum — whose fund made 9.4 percent last year while markets were plummeting — believes UK equities could soon be enjoying a “March 2003″ rally.

Hedgies leave fancy duds at home as credit crisis crimps style

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- rtr1mgp6By Svea Herbst

 

Ladies and Gentlemen: you may leave your ball gowns and tuxedos at home tonight.

That’s the message the badly battered hedge fund industry is sending its managers, lawyers and accountants who are planning to attend Hedge Funds Care, one of the industry’s most successful charity events in New York on Wednesday evening.

In the wake of the industry’s 19 percent loss last year, organizers scrapped the annual black-tie dinner in favor of a cocktail party, Kathryn Conroy, the charity’s executive director said.

Going global

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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.

Bouncebackability

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rtr1rmafHedge fund returns have bounced back in January after their bleak 2008.

Data from Hedge Fund Research shows they returned 0.39 percent in January, having lost 18.73 percent in 2008, although they gained 0.21 percent in December.

The start of a revival in hedge fund returns? Well, maybe, and maybe not.

One explanation is that returns are just bouncing back after losses were exacerbated by redemptions late last year.

Fewer arbs to iron out the bumps

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rtryqvsThe decline in the hedge fund industry is starting to impact some markets in which these free-wheeling vehicles once played, as Jane Baird’s article “CDS price quirks abound as arbitrage withers” demonstates.

She points out that the $45 trillion credit derivatives market is now full of pricing quirks because many hedge funds, once big arbitrageurs in the sector, no longer play here.

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