Funds Hub
Money managers under the microscope
Morning line-up
Hedge fund stories from the past 24 hours from Reuters and elsewhere:
Conservatives’ Clarke tries to appease hedge funds over new rules – Times
Hedge fund firm NewSmith pays members 29 mln stg in 2008 – Reuters
Fund manager pleads guilty in Ponzi case – Chicago Tribune
Citadel’s main hedge funds continue rally in September – WSJ
Despite ’08 pain, the rich still like hedge funds – Reuters
Frontier backs synthetic over single hedge funds – FTAdviser
Bearish Bullman
Stocks may have enjoyed a huge rebound this year (the S&P 500 is up 50 pct from its March low), but the rally is based on speculation, according to one hedge fund firm.
Bullman Investment Management, which runs a global macro fund, has just put on short positions on the S&P and the financials sector via ETFs, manager Nick Bullman told me.
Octopus’s Crawford eyes FTSE at 5,000
Some good news for the bulls.
Octopus fund manager David Crawford believes this year’s equity rally could lift the FTSE 100 to the 5,000 mark, from just over 4,600 currently, helped by energy stocks.
The call backs up that from hedge fund manager Crispin Odey, who earlier this year pointed to the start of a new bull market and then recently said there is “every reason to be hopeful that a major correction will not happen before September”.
This season’s trendy shorts
2008 may have been the year of shorting imperilled financials, but 2009 could be the year of shorting companies with too much debt or those bearing the brunt of the recession.
Numbers from Dataexplorers show Consumer Discretionary and Industrials are among the sectors with the most stock out on loan in the UK– a good indicator of short-selling activity.
Staying long
The mammoth rally we had in Q2 may be starting to falter — the FTSE 100 is now below 4,200, having hit 4,500 last month — but Octopus’s David Crawford is sticking with a 60 percent net long position.
Crawford made part of his Absolute Return Ucits III fund’s 71.1 percent return (since launch last March) by shorting stocks in 2008 and by going net long four months ago.
Time to crack open the champagne?
May was a bumper month for the battered hedge fund industry with an impressive 5.23 percent return, the best monthly gain in almost a decade.
The data, from Hedge Fund Research, takes returns for the first five months of the year to 9.43 percent. After last year’s record losses, this is a much healthier figure and more reminiscent of the returns during the industry’s boom years such as 1999 or 2003.
A genuine rally or just bull?
Big-hitters Crispin Odey and Anthony Bolton may have pointed to the start of a new bull market, but not all hedge fund managers are convinced.
A report from Credit Suisse/Tremont, published today, says many managers played it safe in April, meaning funds made an average gain of just 1.68 percent, compared with a 9.57 percent rally in the S&P 500.
Odey backs the bull case
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.
However 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.
Light at the end of the tunnel?
There’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.
