NEW hedge fund raises $ 96 M

New York hedge fund firm Fir Tree partners has launched a new hedge fund.

The Fund, which is offered by Fir Tree affiliate Camellia Advisor, up 96 million dollar begins 1 dec, according with the Securities and Exchange Commission filing made public on Wednesday.

Also in archiving, will fund open to investors in less than a year. The money was raised from 10 investors who put in a minimum investment of $1,513,.

FIR Tree Partners was founded in 1994 by the Wall Street veteran Jeffrey Tannenbaum. The company has approximately $ 7 billion of assets under management and acting in various strategies including real estate.

eVestment | HFN industry report: October 2011

Click here to read the full report.

eA |HFN industry overview: October 2011

November 22, 2011 with 3,525 hedge fund products, reporting, HFN Hedge Fund aggregated Index was + 2.37% in October and-3.61% YTD 2011 while S and P 500 Total Return Index (S & P) was + 10.93% during the month and + 1.30% YTD.

Hedge fund industry October highlights
• Total industry assets increased approximately 1.01% to $ 2.484 trillion in October. Performance accounted for the majority of the asset increases and net investment flows were negative.
• Equity market exposure was the primary positive performance driver in October. Credit strategies has lagged, but were positive and raw material resources, especially those with high exposure to FX markets brought down the total hedge fund returns.
• The total performance reasons that month came from sectors and policies that were down significantly in Q3 and remains negative for the year, with the exception that the health-focused resources.
• UCITS structured hedge funds dragged the broad industry in October and is-7.15% YTD. UCITS products, virtually aggregated and long/short equity only has consistently crisis management HFN Hedge Fund Long/Short Equity and aggregate indices of 2011.

Shows that defensive positioning of equity focused funds, muted returns from non-irritable credit and relative value strategies and losses from managed futures funds, likely due to long exposures to the US dollar, resulted in overall hedge fund returns significantly lags the massive capital market increase. There are pockets of strong results, but in the months that October is not expected that the industry keep pace with the stock markets.

HFN developed outliers ratio to determine which sectors producing returns outside of their normal ranges. In October, illuminated mortgages relationship, managed futures and fixed income arbitrage strategies sub-sectors abnormally crisis management in October.

Regional benchmarks
A complete reversal from September produced all regional exposure specifications total positive return in October. Emerging market exposure was most positively influenced by the market exuberance with Russia and Brazil focused medium tip.

Funds investing in Russia received an average of 9.80% which reduced average losses in the lower-14.20% YTD. Russia focused fund performance 2011 has been poor, but the funds investing in India and in the MENA region has been worse-21.29% and-15.84%, respectively. After an average of + 6.27% in October, funds investing in Australian markets are only regional exposure are positive in 2011. Funds investing in Japan seems very defensively positioned in October. The group is much equity oriented, but 70% of reporting medium produced negative returns one month after the Nikkei rose + 3.31%.

Monthly access Flow estimates
• Estimated Total hedge fund assets at the end of October 2011 was $ 2.484 trillion, an increase of 1.01% or 25.0 billion dollars from September.
• Performance accounted for an increase of 25.7 billion dollars and investors accounted for a net outflow of 770 million dollars.
• The most important growth/decline (% access change due to investor funding/redemption) was-0.03%, the closest to the flat reading then eA |HFN started tracking monthly flows in 2009.
• In the first 10 months of 2011, investors have put estimated 48.4 billion dollars to the hedge fund industry.

Despite the net outflow from investors in October, third in the last four months, it is more important sharp reversal of trend from Q3 when there were two months above average investor redemptions.

Some sector specific feeds
• The post natural disaster impact of net investor inflows into Japan funds seem to have disappeared. Investors withdrew more than the assigned Japan focused funds in October for the third month in a row and at a rate which has risen in each of the past three months.
• Flows to commodity focused and managed futures strategies jumped in October along with diversified sectors funds, giving defensive positioning from investors.
• Investor's redeemed more than assigned to mortgage related strategies for second month in a row and increased pace in October.
• Funds lies in Asia continued to attract assets in above average in October, but funds investing in Asian markets had their second month of above average outflow. Developments prior to September had been both classifications to attract new assets.

Performance Review
Fixed income (FI) strategies
• The average return of all fixed income focused strategies was + 1.04% in October and + 3.13% for the current year.
• Corporate and emerging market focused funds that performed best during the month, + 2.44% and + 1.57%. Distressed credit funds were + 2.25%, underperforming broadband needy universe that was + 3.01% in October.
• Fixed Income Fund's assets rose 0.23% in month to 671.8 billion dollars, but the increase was solely performance driven. Investors redeemed NET 4.44 billion dollars during the month.

Equity capital (EQ) strategies
• The average return of all equity focused strategies was + 3.90% in October and-5.13% YTD.
• Funds with a bias towards value investing most participated in the equity market rally, rising an average of + 6.46%.
• Equity assets increased approximately 3.15% to 795.6 billion dollars in October, but investors redeemed NET 3.87 billion dollars during the month is still a heightened pace.

Raw materials and strategies for Foreign Exchange (FX)
• Natural resource specific commodity strategies was + 1.90% in October and + 1.94% YTD.
• Agriculture funds was + 2.32% during the month, and metals markets funds returned an average of + 0.71%. The two differ on the basis of YTD returns an average of + 6.94% and-15.43% respectively.
• Funds targeting financial futures and FX markets were both closed in October,-1.58% and-1.85%, respectively.

Summary analysis
October's rally was a sharp reversal of the previous two months trend and subsequently represented the hope that the European sovereign situation would have a resolution in sight with the announcement of the size and scope of the EFSF. Punctuated by Spain's sub par bond auction, November seems to be a return to reality and some of the trends prevailing in Q3, namely weak equity markets and a strong US $. These environments again likely will favor relative performance of the equity strategies in their respective markets, credit strategies will again likely to outperform stocks and global macro managed futures strategies will be mixed, but mostly positive, if they weren't shaken Webcast currency reversal. At this rate, it is likely it will be his second negative year total returns in the last four digits, the first time in its relatively short history.

Click here to read the full report.

NJ But Charged With Hedge Fund Fraud

Two New Jersey men were arrested Wednesday on charges of fraud victims of more than 3.5 million dollars in false hedge fund scam.

New Jersey U.S. Attorney Paul j. Fishman announced that George Sepero, 39, Glen Rock, N.J., and Anthony Provenzano, 29, in Garfield, NJ, were charged with wire fraud conspiracy.

Prosecutors in a complaint Sepero and Provenzano claimed to have operated several hedge funds with a secret computer programs to invest in foreign currencies and achieve returns more than 170 percent in the previous two years.

Prosecutors also argued that the two men spend money invested with them at advanced vehicles, luxury travel and five-figure bar tabs.

Fishman offered a mild rebuke to the victims of the alleged scheme that they should have been more vigilant when they invested with Sepero and Provenzano.

"Nobody asks to be merchants, but they look to invest should always be skeptical of the rate of return that extends so far beyond the norm," Fishman said.

The couple made his first appearance in Federal Court in Newark, NJ Wednesday afternoon. U.s. Magistrate Judge Michael Shipp was released both defendants on $ 250,000 bond each, and ordered that their travel is restricted and passports surrendered. If convicted, face Sepero and Provenzano 20 years in prison and a fine of $ 250,000.

Complaints against George Sepero and Carmelo Provenzano

Advent och eVestment alliansen gå med styrkor

Software provider of hedge fund management, Advent Software has entered into a strategic cooperation with investment data and analytics company eVestment Alliance.

Notice on Tuesday means that there is integration between Advent portfolio accounting and solutions, Advent portfolio Exchange ? (APX) and Axys ? and eVestment Alliance Exchange product.

Both sides see this as helping asset managers reduce the time and effort associated with completion of the consultancy and third-party databases with quarterly data.

Matt Crisp, principal and co-founder of eVestment, said, "this relationship has been formed as a direct response to client requests to simplify data update process and with Advent superior software, we're certain it will present tremendous advantages for clients of both organizations."

George McLaughlin, senior director at Advent, said, "Advent saw an opportunity to join forces with eVestment Alliance to help our clients streamline the process for updating third party databases."

Both companies are familiar to readers of this site eVestment Alliance is the parent company of Hedgefund.net while Genesis has been sponsor of Hedgefund.net twice a year Hedge Fund Administrator survey.

Advent and eVestment data integration solution is expected to be available in early 2012.

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Previously Moore capital Trader close Fund

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(A) forms trader at the New York-based hedge fund Moore Capital Management has decided to close his hedge fund.

After eight years, Tim Leslie's firm James Caird Asset Management, will liquidate the $ 1.6 billion fund that suffered from massive losses this year, Bloomberg reported.

The credit fund lost an astonishing 8.9% in the first 11 months of 2011, while most hedge funds lost an average of 3.8%.

Leslie plans to start a smaller hedge fund next year and is looking to raise $ 500 million for the new fund and cap assets at about that level, according to Bloomberg.

Leslie joins an increasing number of hedge fund managers who have shut down their funds due to Europe's debt crisis.

Go to Bloomberg article

Jim Simons gives $ 150 M gift to NEW school

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Just in time for the holiday season, Stony Brook University in Long Island gets a $150 million gift from a hedge fund billionaire.

James Simons, the founder of New York-based quant hedge fund Renaissance Technologies, and his wife Marilyn, attended the donation announcement at the Stony Brook campus on Wednesday. They were joined by New York Governor Andrew Cuomo as well as a bevy of state and school officials.

The $150 million gift by the Simons is considered the largest amount donated in the history of the State University of New York, the parent system of Stony Brook, and more than twice as much as the Simons’ $60 million donation to the university in 2008.

Most of the $150 million will be given over a seven-year period to go toward medical sciences research, including the construction of a life sciences building and the creation of a neurosciences institute.

The donation will also help pay for 35 new endowed professorships, and create 40 fellowships for graduate students.

The couple spoke about their donation to the school, where James Simons was once the chairman of the math department, and where his wife earned her undergraduate and graduate degrees in economics and met her future husband.

"Stony Brook has given me so much and I'm very happy to be able to give something back," said Marilyn Simons at the announcement.

The notoriously reclusive Simons said for years he and his wife wanted to donate money to Stony Brook but were discouraged by minimal state support for improving the university. Then, commitments from governors - starting with former governor Eliot Spitzer - to raise school tuition to upgrade facilities changed his mind.

"I really have no doubt that within the next, five, six, seven years, Stony Brook is going to join the ranks of America's and the world's truly great public universities, and I am happy to part of it and so is Marilyn," Simons said.

Additional reporting by Ricardo Kaulessar

Photo capture of video stream of hedge fund billionaire James Simons and his wife Marilyn at an announcement Wednesday of the couple's $150 million donation to Stony Brook University in New York. Credit: Ricardo Kaulessar.

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eVestment | HFN focus strategy report: financial sector

Click here to read the full report.

Overview: financial sector hedge funds

EVestment |HFN active and inactive databases, performance and information on assets of 89 unique funds investing primarily in the financial services sector. There are an additional 35 funds investing in multiple industries and has explicitly taken note of the exposure of the economy.

The classification is much equity oriented and includes exposure to different subsectors including large and small banks and financial services to businesses, thrifts, insurance, and specialty finance firms. Strategies are primarily long/short, but the event driven, focusing on consolidation is a common theme.

The Angel in a relatively poor performing market, the Group has produced returns and volatility statistics are similar to the broad hedge fund industry in both 2011 and LTM.
• The Group has substantially performed financial sector benchmarks 2011 both in terms of performance (900 + points) and volatility (almost half the standard deviation of monthly).
• Investor sentiment towards financial sector funds has been better than most other sector specific equity funds in 2011, but still far below average in the industry.

The financial sector has become one of the most volatile capital market sectors during the last 12 months. The threat of a large-scale sovereign crisis in Europe together with increased regulation have done in and invest in the sector a challenge. The rest of the report takes a closer look at asset flow and performance trends in the classification to determine sources of benchmark outperformance and measure investor sentiment.

Total asset levels and investors flow trends
eVestment |HFN tracks AUM and publishing time estimates for funds investing primarily in the financial sector. Global hedge fund exposure to the sector can be significantly larger, but tracking impressions of sectors means is not possible at this time.

• Total AUM in funds investing primarily in the financial sector was 15.81 billion dollars at the end of October 2011, a decrease of 2.05 billion dollars or 6.21% through 10 months of the year.
• Investor's redemption net 610 million dollars from the group in 2011 to a core decline 3.59%. This compares with a growth rate of 2.21% for hedge funds industry 2011 core.
• Performance has reduced the financial sector fund AUM estimated 440 million dollars to October; an asset-weighted return of approximately 2.91% compared to-1.63% for hedge funds.
• "Investors have been net redeemers of assets from the financial sector funds in 9 of the last 12 months, but it was the jump in distributions in September.

Despite the above average and sustained total payments from the financial sector hedge funds, have been pockets of investors ' interest in 2011 and has mostly for those funds that performed in 2010. Average net total 2011 for funds returns exceed the Fund's average financial sector 2010 was 7.05 million dollars. Average 2011 flow for those crisis management 2010 was a net redemption 14.27 million dollars.

However, no Fund really doing in 2010 and have a meaningful input 2011 is posting positive returns the current year or returns greater than the average for the group in 2011. A potential positive for AUM will emerge is that there are no large funds have experienced net outflows so far, but also performs very well. It is probably these funds that will attract investments by 2011.

Regional performance trends
Table 5 compares the percentile ranks financial sector funds over the past 12 months based on their declared regional investment aid focus.

• The European sovereign crisis has seriously affected the relative performance of funds investing in the region's financial sector. Proceeds from the Group Global economy also shows high exposure to the European economy.
• The U.S. economy has not only performed the Confederal Group of the European economy by almost 400 bps 2011, they have also performed all focused hedge equity funds and the sum of the hedge fund industry YTD.
The Angel good relative performance, fewer than one-third of U.S. focused financial sector funds are positive in 2011. Those are large, up an average of + about 12%. The task is that the minority has made the right call in the group in 2011 and they have been rewarded.

Financial sector focused Sub Strategies
Figure 9 shows the performance of economy focused medium with stylistic systematic and their relevant broader hedge fund peer groups.

• Financials sector funds invest based on a fusion/event driven, dramatic crisis management their peers during a prolonged period.
• Clean and broad capital market movements has been much affected by macro events overwhelming micro factors, wider event driven and fusion/risk arbitrage has performed long/short equity strategies suggest idiosyncratic factors are blamed for the poor performance of event driven/fusion financial resources.
• Small/Mid CAP funds have performed well compared with the broader financial sector funds. The Group posted better results than long/short equity funds, but crisis management towards sector size independent small/micro cap over a longer time perspective.
• Both biased style groups showed significantly higher volatility compared to the broad economy focused sector funds, but was well below the NYSE financial indices and the S & P 500 TR.

Performance comparison of equity sector
Funds investing in financial records was in the middle of the pack in comparison with other sector specific equity strategies, LTM.

• Perhaps surprisingly, financial sector funds showed the lowest volatility of the preceding 24 months in relation to other sector specific equity funds (based on the annualized standard deviation); natural resources sector topped the list.
• Sector specific equity funds continue to show high strategy correlations, varies between 0.76 (financial resources) to 0.87 (financial to property) since Jan-2009.
• Healthcare focused funds, generally regarded as a defensive sector, has performed all other equity sector groups on the basis of the current year.

Forward
Economy has received much attention since the financial crisis both in terms of the role played and how some companies have performed in a unique environment then. European sovereign debt crisis continues to loom over large parts of the industry and MF Global bankruptcy was reminscent of the risks for 2008. The sector has, however, sufficient diversity both by market cap and industry subsector for managers to efficiently outperform benchmarks. In addition, the sector remains volatile and trading at levels seen in mid-2009, managers can see the possibilities. Downside risks, however, may be close to all time highs as effective assurance is absolutely key.

Although overall performance has shown controlled downside volatility for the group, will many individual economy oriented funds have to show greater resistance to beta-driven losses to stem outflows in the near future. In the intermediate term, secular changes in performance drivers for many funds come from the eurozone crisis, particularly the recapitalization of banks. These events will give the macro backdrop against which subsectors and company specific microeconomic events will challenge. Investors in space should be aware of any funding expectations and plans for management of these factors.

Click here to read the full report.

Singapore fast avkastning kapital till investerare

Singapore-based hedge fund RSR capital returning capital to its investors and is planning to start next year.

The company plans to re-strategize after it suffered almost 8% in losses during the first 10 months of 2011, reports Reuters.

"We will try out new strategy from January to June 2012, and if we like performance, we accept funds from external investors again, says chief operating officer and founding partner Christophe Delorme in e-mail to Reuters.

Despite growing interest in Asia, has more than 80 hedge funds in the area closed down this year due to dwindling assets, according to Reuters.

Go to the Reuters article

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MF Global grilled again by Congress

MF Global bankruptcy saga continued Tuesday with another Congressional hearing which had some new wrinkles as compared to the previous.

This time we hear the Agriculture Committee, Senate not only from previous MF Global CEO Jon Corzine and federal regulators if the broker-dealer's spectacular collapse in October that the Agriculture Committee, the House did last week, but from some of the victims caught in the economic fiasco.

The hearing began with testimony from clients who had accounts with MF Global, and might never be able to get their money back because the alleged found segregated customer funds with MF Global investment money that led to 1.2 billion dollars in customer funds are still missing.

Roger Hupler, Chairman of Freeland Bean and grain, a cooperative in Freeland, Michigan, spoke to the members of the cooperative who lost money in MF Global account.

"He is not a prospect, just a responsible operator. He sells cash grain and with futures options, hedge risk, said Hupler.

Minnesota farmer Dean Tofteland offered sharp criticism about MF Global allegedly did business, which he lost over $ 300,000.

"The call" illegal comingling "on Wall Street is called" stealing "back on the Main Street," said Tofteland.

The two men, along with Kansas farmer C.J. sucked and Jeff Hainline, Chairman of advanced beings in Bloomington, Indiana, all agreed that the money needed to be returned immediately and new regulations needed to be in place to make sure it doesn't happen again.

After their testimony was Corzines turn. This time, he was joined in the infamous hot seat of current MF Global president and chief operating officer Bradley Abelow and its current Chief Financial Officer Henri Steenkamp.

Agriculture Committee Chair Debbie Stabenow (D-MI) full all three with variations of the same question, "where is the money?" but received only variants of the same reply, "you don't know where the money is?" from the trio.

However told Jill Sommers, a title of Commodity Futures Trading Commission's review of MF Global, Reuters on Wednesday that regulators have a better sense of where the funds went missing but has not decided if any funds are moved from customers ' accounts to the brokerage accounts were "illegitimate".

Go to the Reuters article

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NY Hedge Fund Charged With Securities Fraud

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Securities and Exchange Commission har laddat New-York-baserade Hedgefond ThinkStrategy Capital Management och dess enda verkst?llande direkt?r med v?rdepapper bedr?geri.

Chetan Kapur har anklagats f?r ?verdriver fondens resultat och ge falska f?retagsinformation till investerare i ?ver sju ?r, enligt instruktionen SEK p? torsdag.

Klagom?let h?vdade ocks? att f?retaget investerat i hedgefonder som var inblandade i Ponzi system eller andra allvarliga bedr?gerier, trots informera investerare att dessa medel valdes efter en rigor?s vederb?rlig aktsamhet process.

Vid sin h?jdpunkt 2008 lyckades ThinkStrategy cirka 520 miljoner dollar i tillg?ngar.

SEK klagom?l mot ThinkStrategy kapital

SEC Charges Feeder Funds in Petters Ponzi Scam

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Two Minnesota-based hedge fund managers and their firm have been charged with helping Minnesota businessman Thomas Petters carry out his multi-billion dollar Ponzi scheme.

The SEC announced in a complaint Wednesday that James Fry, Michelle Palm, and Fry’s firm Arrowhead Capital Management were charged with securities violations.

The SEC alleged that Fry and Palm, and Arrowhead Capital invested more than $600 billion in hedge fund assets with Petters while collecting more than $42 million in fees.

The agency also alleged Fry, Palm, and Arrowhead falsely assured investors and potential investors that their money would be safe through certain collateral accounts.

The agency then alleged that Fry, Palm, and Arrowhead hid Petters’ inability to pay back investors by entering into secret note extensions with Petters.

Petters was sentenced in April 2010 to 50 years in prison for orchestrating the scam that took in $3.7 billion in investor money that was supposed to be placed in funds investing in asset-backed paper, the assets being large-ticket appliances. But the transactions and the paper turned out to be fictitious.

Palm pleaded guilty to one count of securities fraud and one count of making false statements to SEC staff during investigative testimony.

Fry pleaded not guilty to multiple counts of securities fraud, wire fraud, and making false statements to SEC staff during investigative testimony. He is scheduled to go on trial in February.

SEC Complaint Against Funds in Petters Ponzi Scam

Paragon Opens Maiden Fund to Institutional Investors

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New York-based event-driven hedge fund Paragon Capital Advisors has open its maiden fund to institutions.

The flagship fund wants to reach its goal of an initial $100 million investment capacity by expanding its target investors to include pensions, fund-of-funds and endowments, according to HFM Week.

The fund opened in 2005, and currently has $20 million in assets under management.

Go to HFM Week article

Wall Street Veteran Writes ' New Chapter ' as TV Personality

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Stephanie Ruhle finds the challenge of being a news personality even more intense than her previous jobs dealing with hedge fund clients for global financial giants Credit Suisse and Deutsche Bank.

The 35-year-old Ruhle is the new co-anchor of Bloomberg Television's morning show, "Inside Track," having started on the job last month. She joins Bloomberg TV vet Erik Schatzker, Sara Eisen, and Scarlet Fu.

"Working in television and television news, it's a double-edged sword in that you're constantly involved in world markets and every piece of news that hits is important to you," Ruhle told Hedgefund.net in a recent interview. "It's an exciting part of the job but it also makes you basically work 24 hours a day."

Ruhle also sees this as a "new chapter" in her life, one she didn't envision until last spring when she told an audience at an event for a woman's leadership organization about pursuing an interest in the media, if given the opportunity. Her revelation caught the attention of one of the organization's board members sitting in the audience, a Bloomberg employee who approached Ruhle after her speech.

"It's hard to pursue something you want to do when you have a life to live," Ruhle says. "But the more we started to talk about this philosophically, the more it turned into a reality."

That soon set in motion Ruhle being in the spotlight rather than in the corporate arena. Ruhle would continue working for Deutsche Bank until September when she moved over to Bloomberg.

While she sees this as a "big leap" for both her and her new employer, Ruhle points out that it was made easier by her past experience of speaking at corporate functions as well as being well-versed in the markets, especially developing expertise in the complex world of credit derivatives.

Ruhle also credits the mindset she developed during her childhood in northern New Jersey and carried over as a student at Lehigh University in Pennsylvania, when she found herself switching over from engineering to being on a trading floor.

"Growing up, I never had one specific interest but I have always been highly competitive," Ruhle says. "So it was less relevant what the game was but what I wanted more than anything was to win it."

What has also gotten Ruhle acclimated to the broadcasting world were her new co-workers, whom she describes as "very smart" and "generous."

So what is it like being a Bloomberg anchor?

For Ruhle, it's starting work at 4 a. m., leaving behind her husband and two small children at their Lower Manhattan home. Then it's meeting with staff and others to prep for 6 a.m. show opening. After the program ends at 8 a.m. Ruhle and her colleagues are already preparing for the next day.

Working daily in the news business has allowed her to not only bring her knowledge of the markets to the general public but also to explore topics as wide ranging as Occupy Wall Street and the European debt crisis.

And it is a job that she sees herself staying in for quite awhile.

"What chapter two will be, I don't know yet?"

Stephanie Ruhle is the new anchor on the Bloomberg Television morning show, "Inside Track". Photo provided by Bloomberg Television.

Citigroup Introduces ' Hedge Fund 3.0 '

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Citigroup wants to help hedge funds operate more efficiently and has a model to make that a reality.

The financial services firm's prime brokerage unit introduced on Wednesday the "Hedge Fund 3.0" concept, based on its study of hedge funds in the past two years.

Hedge Fund 3.0 is designed as a guideline for building a successful hedge fund by focusing more on the core of their business — promoting to potential customers and growing the assets under management.

The way that will happen successfully during the Hedge Fund 3.0 model is by hedge funds shedding a number of in-house operations and outsourcing them.

The model identifies what measures would be beneficial for hedge funds to attain efficiency along with savings: business process outsourcing for various day-to-day functions, specialist HR and benefits brokers, off-premise IT services and knowledge process outsourcing.

(A) previous Citigroup survey found that firms spare no expense when it comes to computer operations as it projected that hedge funds will spend over $ 2 billion on information technology in 2011.

Sandy Kaul, U.S. head of business advisory at Citi, said hedge funds in today's markets should consider Hedge Fund 3.0.

"These firms can think strategically about the use of outsourced partners, especially when facing trigger events, such as, expansion to larger office space, replacing end-of-life equipment, moving to multi-currency operations, or launching a new investment strategy," Kaul said. "Over time, many funds will move to a hybrid approach that combines in-house and outsourced resources."

Citigroup's New Hedge Fund 3.0

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MF Global Lays Off Over 1,000 Employees

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The other shoe dropped at MF Global when the bankrupt hedge fund brokerage reportedly let go over 1,000 employees Friday.

Most of the 1,066 employees, who worked in the New York and Chicago offices, were informed of their termination in town hall meetings held in both cities, although some complained that they only found out from the press, according to news reports.

About 150 to 200 employees will be rehired in the near future to help assist in closing out the firm and processing bankruptcy claims.

The brokerage, led by former New Jersey Governor and Goldman Sachs executive Jon Corzine, filed for bankruptcy on Oct. 31 after losing almost 70% of its stock value in one week last month, along with a 14% decline in revenue for its second quarter compared to the same period last year.

Corzine resigned from his positions as CEO and Chairman on Nov. 4.

Go to CNBC report

Go to New York Times report

Go to Dow Jones report

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Former CalPERS Chairman Joins Lyrical Partners

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Fund-of-hedge-funds firm Lyrical Partners has hired a former chairman of the investment committee for the CalPERS pension system.

Michael Flaherman has joined the firm as a managing director, according to a statement by the firm on Wednesday.

In his newly-created position, Flaherman will also serve on the investment committee for Lyrical's fund of hedge funds.

Flaherman served on the investment committee for CalPERS from 2000 to 2003 and had served as a board member since 1995.

Lyrical Partners is based in New York and was founded in 2004 by Jeffrey Keswin, who previously co-founded Greenlight Capital.

Investment Jumps in Socially Responsible Alt Funds

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A new report finds that investment in alternative investment funds with environmental, social and governance criteria went up about 16% from last year.

“Sustainability Trends in Alternative Investments in the United States,” a report from the SIF Foundation by the Center for Social Philanthropy at the Tellus Institute, details that $80.9 billion was invested in 375 alternative investment funds - hedge funds, property investment, venture capital and private equity - incorporating ESG criteria at the beginning of 2011.

According to the report, that’s a 15.9% growth in combined assets since the beginning of 2010, when 346 alternative funds managed a combined total of $69.8 billion.

The report also found that hedge funds lagged behind other fund vehicles when it came to socially responsible investment with 47 hedge funds, representing a total of $2.6 billion in assets under management. That’s only 12.5% of funds reported with an ESG mandate.

“Sustainability Trends in Alternative Investments in the United States”

Where Are The Women In The Industry?

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According to the 2010 U.S. Census, while the number of working women have surpassed that of men, the hedge fund industry have yet to reflect that statistic.

Women only manage about 3% of the nearly $2 trillion industry, according to a recent study, but they get their due in a Business Insider article this week.

The spotlight is shone on such stars as Renee Haugerud, founder of New York-based fund Galtere, who transformed her $5 million firm into a $1 billion company; Leda Braga, president of BlueCrest Capital Management, who manages an astonishing $8 billion alone in her fund; and Elena Ambrosiadou, founder of Cyprus-based hedge fund IKOS Asset Management, who runs nearly half of the company's $2.5 billion assets under management.

Go to Business Insider article

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SEC Shuts Down Supposed Quant Fund

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A Massachusetts money manager and his investment advisory firm have been shut down by the Securities and Exchange Commission for his falsely claiming operation of a quant hedge fund.

The SEC on Wednesday alleged that Boston resident Andrey Hicks, 27, through his firm Locust Offshore Management, raised at least $1.7 million from several investors for the purported hedge fund, only to put the money into his personal bank account.

Also in the complaint, the agency alleged that Hicks and his firm misrepresented that the fund had held more than $1.2 billion in assets, Ernst & Young served as the fund’s auditor, Credit Suisse served as the fund’s prime broker and custodian, and the fund was incorporated in the British Virgin Islands.

Furthermore, the SEC alleged that Hicks lied that he worked at Barclays Capital, and graduated from Harvard University.

The SEC going after someone operating a fake hedge fund was the second such action by the agency in the same day. Also on Wednesday, the SEC charged Florida resident Scott Kupersmith in a securities fraud scheme involving a bogus hedge fund.

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Barclays Wealth With Six New Hires

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London-based hedge fund manager Barclays Wealth has hired six investment representatives for its various U.S. offices.

The advisors, each with an average of 19 years of financial experience, will be placed in the firm’s Boston, New York, Dallas and Miami offices, according to a company statement.

Glen Darby and Matthew Grady will both work in the Boston office, with Darby coming from Merrill Lynch's Private Banking and Investment Group and Grady from Boston-based firm Old North Advisors.

Jerrid Douglas and Andrew Leventhal have been appointed to the New York office. Prior to Barclays Wealth, Douglas was with Citi Private Bank while Leventhal comes from Credit Suisse Private Banking.

Over in Dallas, Michele Huff Powell joins the firm from U.S. Trust, Bank of America Private Wealth Management.

Finally, Narciso Munoz has been appointed to the Miami office. In his previous position, Munoz spent 7 years at HSBC's International Private Bank.

Barclays Wealth has $272 billion in total client assets.

Hey, It’s Raj Rajaratnam: The Movie

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There’s already a movie in the works about disgraced Ponzi schemer Bernard Madoff, so why not one on convicted hedge fund manager Raj Rajaratnam.

According to an article in the Hollywood Reporter, independent film company 108 Production announced Thursday that it is developing “Billion Dollar Raja,” with filming to start in the fall of 2012 in New York, Florida and Italy.

The movie will be written and directed by Nayan Padrai and produced by Sheetal Vyas, both responsible for the romantic comedy “When Harry Tries to Marry” that came out in theaters last spring.

Rajaratnam was sentenced to 11 years in prison earlier this month, one of the longest sentences for an insider-trading case.

Go to Hollywood Reporter article

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Rajaratnam Associate Charged with Insider Trading

Latin America Doing Well, But Elsewhere …

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How would one know if Latin America is good place for investment?

Start with Tulio Vera, managing director and chief investment strategist at Bladex Asset Management, a New York investment adviser that oversees a macro hedge fund with a primary focus on Latin America.

Vera was a guest speaker at an event organized by the Latin American chapter of the lobbying group Hedge Fund Association at the Pierre Hotel in New York on Oct. 6. The event’s other featured speaker was SkyBridge Capital’s Anthony Scaramucci.

A Merrill Lynch vet who has dealt in Latin American investment strategies for years, Vera said it was a “good moment” now for Latin America in terms of investment when compared to Europe and its current economic crisis.

“Use Europe as a hedge; I think it has been probably the best hedge this year to be long Latin American emerging markets and hedge with Europe,” Vera said.

He also said Latin American emerging markets such as Brazil and Chile have changed the perception that those markets will be besieged by inflation by cutting interest rates.

Vera then turned to the economic powerhouse that is China, and explaining how it has become more important to Latin America than Europe and the U.S. because of the trading relationship between the two regions.

“Commodities are the bridge between the Far East and China, and Latin America,” Vera said. “Every major Latin American country is, in one way or another, a commodities exporter of sorts, whether it’s copper or wheat or oil or soy.”

He then wrapped up his speech with this pithy credo: “Latin America is in good shape, the world around is very turbulent.”

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eVestment | HFN Industry Report: September 2011

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Click here to read the full report.

eA|HFN Industry Overview: September 2011

On October 21, 2011 with 3,168 hedge fund products reporting, the HFN Hedge Fund Aggregate Index was -3.09% in September and -5.58% YTD 2011 while the S&P 500 Total Return Index (S&P) was -7.03% during the month and -8.68% YTD.

Hedge Fund Industry September Highlights
•Total industry assets fell an estimated 2.92% to $2.463 trillion in September. Performance accounted for the majority of the asset decrease and net investor flows were negative for the month.
•Average hedge fund return in Q3 was -5.97% and investors withdrew an estimated net $19.3 billion. These represent the first quarterly loss and net redemption since the financial crisis.
•Falling commodity prices along with volatile equity markets and large losses from emerging market funds weighed most heavily on hedge fund returns in September.
•Fixed income strategies continued to outperform equity funds, the latter posting negative average returns for the fifth consecutive month and falling -9.34% in Q3 vs. -1.39% for FI strategies.
•Mortgage sector funds posted their second consecutive aggregate decline and their worst return monthly since November 2008, however the HFN Mortgages Index was +9.28% through Q3 2011.

High volatility across most major markets was the norm in September caused primarily by the ongoing sovereign crisis in Europe and worries over the size and timing of the EFSF bailout fund. The resulting reduction of exposures to risky assets during the month appeared to benefit FX strategies and funds focused on government bonds. Their aggregate returns were +1.88% and +1.12%, respectively, during the month.

HFN developed the Outlier ratio to determine which sectors are producing returns outside of their normal ranges. In September, the ratio highlighted emerging markets as a sub-sector which was hit particularly hard with their worst performance since October 2008.

Regional Benchmarks
No regional specification produced aggregate positive returns in September. Emerging market exposures were most negatively impacted. Funds investing in Russia lost an average of -13.01% which is bad, but not nearly the -28.20% decline seen in October 2008. Conversely, losses from funds investing in Brazil and China were nearly on par with their declines during the financial crisis. Only funds investing in developed European markets and in Japan lost less than 1% on average during the month, -0.38% and -0.91%, respectively.

Performance from funds investing in developed European markets was relatively good in September. The Stoxx Europe 600 Index was -4.74% during the month compared to the median return from equity strategies focused in the region of -0.95%; the HFN Long/Short Equity Index was -4.14%. Investors continued to withdraw assets from developed Europe funds at an above average rate in September.

Monthly Asset Flow Estimates
•Total estimated hedge fund assets at the end of September 2011 were $2.463 trillion, a decrease of -2.92%, or $74.1 billion from August.
•Performance accounted for a decrease of $59.5 billion and investors accounted for a net outlfow of $14.5 billion.
•The core rate of growth/decline (% asset change due to investor allocations/redemptions) was -0.57%, the second monthly decline of Q3 2011.
•There was a net investor outflow of $19.3 billion in Q3, the first quarterly outflow since Q1 2009. Redemptions were nowhere near the scope of that quarter when the industry lost an estimated $215 billion.

With increased volatility and performance losses emerging, investor flows began to slow in May 2011 and eventually shifted to net redemptions in July. The net outflow in September was the largest since April 2009. Allocations and redemptions have a history of lagging performance by a few months which would indicate net outflows may persist.

Sub-Sector Specific Flows
•Investors withdrew more than they allocated to Japan focused funds in September at a rate above the industry average. Developed Europe focused funds also faced net investor outflows for the fourth month in the last five.
•Emerging markets funds continued to lose assets at an above average rate in September. The group had an estimated $1.8 billion in net redemptions during the month and $4.8 billion in Q3.
•Investors appeared to be reducing exposure to credit strategies during Q3 as redemptions came at a higher rate than that of equity strategies for the first quarter since Q1 2010.
•Fixed income arbitrage and event driven strategies had among the highest rates of net outflow in September. Global macro was among the few strategies with net allocations.
•Asia domiciled funds continued to increase AUM due to net investor flow in September. The region has seen above average growth rates throughout 2011.

Performance Review
Fixed Income (FI) Strategies
•The average return of all fixed income focused strategies was -0.80% in September and +2.37% year-to-date.
•Government bond strategies again performed best during the month, +1.12% and corporate credit strategies were -2.17%.
•Fixed income fund assets fell for the third consecutive month, -2.37% in September to an estimated $676.4 billion. Investors redeemed a net $11.2 billion during the month.

Equity (EQ) Strategies
•The average return of all equity focused strategies was -4.42% in September and -8.68% YTD.
•Energy focused funds were down most, -8.10%, followed by small cap strategies and healthcare funds, -5.88% and -5.21%, respectively.
•Equity fund assets fell an estimated -5.03% to $769.5 billion in September. Investors redeemed a net $4.4 billion during the month.

Commodity and Foreign Exchange (FX) Strategies
•Broad natural resource commodity strategies were -0.53% in September and +0.26% YTD.
•Returns were again varied by sector. Funds investing in metals markets were -13.5% while agriculture funds were +0.03% during the month.
•Funds targeting financial futures again withstood market volatility relatively well, +0.13%, and FX strategies had some of the best overall performance in the industry, +1.88%.

Summary Analysis
The European sovereign debt crisis, operation twist embarked upon by the U.S. Federal reserve, evidence of China’s slowing economy and their housing market topping out were all stated by managers as contributors to the high level of volatility in September. October asset flows will be a good bellwether for the rest of the year as typically outflows would be expected with the continued performance losses. It is possible investors recall the missed opportunities following 2008 and currently invested capital may be more sticky, or new money may come in more quickly. Regardless, 2011 is shaping up to be the second year of annual performance losses on record for the hedge fund industry and investors will be hunting for investments which can match their rising budgetary needs.

Click here to read the full report.

New Rules Bring About Hedge Fund Transparency

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The Securities and Exchange Commission approved Wednesday the adoption of a new rules requiring private funds to report details of about how they borrow and invest.

Specifically due to the Dodd-Frank Act, registered investment advisers with at least $150 million in private fund assets under management must periodically file reports on what is known as Form PF with regulators starting next year, according to various reports.

Also the advisers are broken up into two categories – “large” and “small” - with large being $1.5 billion and above, while smaller funds are below $1.5 billion.

The new rules are considered historic since private funds including hedge funds, private-equity funds and other types of pooled investment vehicles in the past did not have to register with the SEC.

However, the hedge fund industry fought for and won some concessions.

Those hedge funds that meet the $1.5 billion in assets threshold would have to provide the most in-depth reporting of information, instead of the $1 billion mark originally proposed.

Some other concessions include filings to be done 60 days after the end of a fiscal quarter, instead of the originally proposed 15 days after a quarter’s end and hedge funds will not have to report on individual holdings in their portfolio but instead aggregate holdings.

But the rule does not go into effect immediately as the Commodity Futures Trading Commission has to approve the rule, which may happen sometime next week.

Those involved in the investment world weighed in on the adoption of the Form PF regulation.

Kevin Duffy, a former SEC staff attorney who oversees the regulatory and compliance practice at financial advisory firm Kinetic Partners saw the pros and cons of the new rule in an interview with Hedgefund.net.

Duffy said the change for filings from 15 days to 60 days was “pretty reasonable.” Yet, he thought Form PF should not be about one form fits all funds but instead should be different forms for different funds.

He also said he wouldn’t be surprised if some money managers would seek legal action to overturn the new rules, pointing out that a lawsuit brought by a hedge fund was successful in stopping the SEC from imposing rules to get hedge funds to register.

At the same time, Duffy offered a caveat.

“If someone is going to bring legal action, they have to look and see if it is financially worth it,” Duffy said.

Go to New York Times article

Go to Wall Street Journal

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eVestment | HFN Regional Focus Report: Developed Europe

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Click here to read the full report.

Overview: Developed Europe Focused Hedge Funds

The eA|HFN active and inactive databases have performance and asset information for 204 unique funds that invest primarily in developed European markets. There are an additional 317 funds which invest broadly across all European markets. The latter may have large exposure to developed markets, but are kept separate to ensure the prior group is a pure representation of developed Europe focused strategies.

•In the midst of the sovereign crisis in the Eurozone, funds investing in developed Europe have performed relatively well in 2011, -4.67% vs. -13.92% of the Stoxx Europe 600, however most lag the aggregate hedge fund industry.
•Investor interest in developed and broad Europe focused funds has been below average. Funds have had an estimated net outflow of $1.8 billion in 2011, or 1.0% of total AUM vs. 2.8% growth for the hedge fund industry.
•On a regional basis, developed Europe focused funds have had the highest rate of combined liquidations and non-responsive fund delistings in the HFN database.

The European sovereign debt crisis has been a slow developing fiscal mess which has severely hurt investor confidence. Hedge funds investing in these markets appear to have been defensively positioned, but there are still pockets of large losses. The remainder of this report will look at the sub-groups of funds investing in the region to see if outperformance of regional equity markets appears to be tactical or if it is more a factor of breadth of strategies and smoothed aggregate performance.

Developments in European Markets and Impacts on HFs
The European sovereign debt crisis has had global market implications, but the effects on European equity markets and hedge funds that focus on them has been direct in terms of relative performance, investor redemptions and liquidations. Following are highlights from the eVestment | HFN database on those funds focused primarily on developed European markets.

•Last twelve month percentile rankings of equity focused developed and broad Europe funds has lagged other developed equity market exposures at all data points.
•Figure 5 illustrates to what extent developed Europe fund performance has tracked the severity of the sovereign debt crisis as characterized by the spread between Greek and German two year sovereign yields. September appears to be another difficult month as the spread nearly doubled and the Stoxx Europe 600 was down almost 10% before the month end rally.
•The eA | HFN database has recorded a 12.4% decline in developed Europe focused funds due to liquidations and non-responsive fund delistings in 2011, nearly double that of broad Asia focused funds and 1.8x higher than North America funds.
•30% of developed Europe funds reporting through August are positive YTD. If September results are similar to August, less than 20% of funds will likely remain in positive territory. Of those reporting through August, 42% are down more than 5%.
•There is virtually no difference in average YTD performance for UCITS structured developed Europe focused funds and those not structured as UCITS.
•Despite above average investor outflows and performance losses, developed Europe focused funds remain larger on average than N. America funds ($212mm vs. $206mm), both of which dwarf the average size of Asia focused funds ($130mm).

There are pockets of positive returns amongst developed Europe focused funds, however no single sub-sector appears to be keeping its head above water. The implication being that positive returns are driven more so by the quality of management than environment. There is a proportional mix of credit, equity and commodity (power markets) funds among those up for the year.

Total Asset Levels
eA | HFN tracks AUM for funds investing across all European markets, including emerging Europe, but has not previously estimated flows for those investing solely in developed Europe. By backing out estimates for emerging Europe we can estimate flows for funds investing solely in developed Europe and broadly across all European markets, the latter being predominantly focused on developed Europe:

•AUM in funds investing across all European markets was estimated at $220.7 billion at the end of August 2011, down from a pre-2008 crisis peak of over $400 billion.
•At the end of August, HFN estimated emerging market Europe fund AUM of $44.8 billion and therefore an estimated $175.9 billion in AUM in funds investing primarily in developed broad European markets.
•Approximately ? of the combined AUM, or $44 billion is invested solely in developed European markets.
•Investors have withdrawn an estimated net $1.8 billion from Europe non-EM focused funds in 2011. This follows net redemptions of $13.3 billion in 2010.
•Redemptions in 2010 began in earnest in May ($10.7 billion net redeemed in May/June 2010) coinciding with the first major spike in European sovereign yields.

The investor flow data paints a very clear picture that investors have been actively reducing exposure to European markets, on an aggregate basis, since the first major fears of a sovereign default in the Eurozone. The rates of redemptions have slowed, but persisted in recent months.

Performance Comparisons by Region/Country
Developed Europe focused funds generally invest across many Eurozone markets; however there are a number of funds which invest either primarily in the U.K., or in Nordic markets. U.K. funds operate almost entirely in equity markets whereas Nordic funds have concentrations of funds trading regional power markets, mortgage bond and the equity markets.

Figures 8 and 9 and the table above show the performance of these funds and their sub-market classifications and performance of other developed country specific hedge fund exposures and equity benchmarks.

•Despite being primarily equity market oriented, U.K. focused hedge funds have performed very well compared to the FTSE 100 Index, however both are in negative territory mostly due to August returns. In September, the FTSE lost an additional -4.93%.
•Nordic equity focused managers have performed very well compared to regional EQ benchmarks. The credit related strategies have fared worse. Performance from these funds has been weighed down by those with leveraged exposure to Danish mortgage bonds.
•Canada focused funds are the only country specific group which has been unable to outperform the relevant equity benchmark in 2011.

Performance by Primary Strategy in Developed Europe
Funds investing in European markets typically fall into one of five primary strategies; Long/Short EQ, Market Neutral EQ, Event Driven, Credit and Multi-Strategy. Figures 9 and 10 and the table on the following page illustrate the relative performance of funds utilizing these strategies in developed European markets to their counterparts operating primarily in other developed market.

•There is a high concentration of funds investing the Danish mortgage market in the developed-only credit group. These funds appear to have suffered after the Basel III proposal determined the bonds would have a limited role in bank holdings as liquidity instruments.
•The classification of broad European credit funds, which have performed more in-line with other developed market credit funds, is more indicative of developed European credit expsure, however their descriptions of regional orientation tend to be more open ended.
•European market neutral equity and event driven strategies have lagged their developed market counterparts by a wide margin in 2011.
•Long/short equity funds have been in-line with North America focused strategies. Asia/Pac long/short funds have performed noticeably better in 2011.

The last page of the report contains full correlations of monthly returns between regional primary strategies and both equity and hedge fund benchmarks over various time frames.

Going Forward
Among the high concentration of equity focused managers in developed European markets, there appears to be a pronounced defensive positioning which has led to the large outperformance during recent market declines. Early indications for September show an average return of -1.38%, compared to a decline of -4.78% in the Stoxx Europe 600, however this may drift lower as more funds report. Combined developed and broad Europe funds are -0.54%.

In the longer term, it is difficult to ignore the consideration that amid this crisis there may be massive value and opportunity being created, similar in concept to the environment mortgage related strategies realized post-2008 financial crisis. The declining rates of net outflows in recent months may be an indication that allocations may be beginning to return in anticipation. Where and when opportunities will be available are obviously the key, but chances are there will be hedge funds at the forefront.

HFN will publish Europe focused fund flows estimates in the both the early performance release due out Tuesday October 11th and in the Monthly Industry Report the week of the 24th.

Click here to read the full report.

Boston Pension Allocates $60M to Hedge Fund

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Boston’s municipal pension system has allocated $60 million to a New York hedge fund firm.

The $4.7 billion State-Boston Retirement System has chosen EnTrust Capital, according to HFMWeek.

EnTrust takes over from Arden Asset Management, which the pension terminated business with in March.

EnTrust Capital has gained name recognition in recent years for having an investor in New York Governor Andrew Cuomo, until he ended his relationship with the long/short firm in 2009.

The firm has $550 million in assets under management.

Go to HFMWeek article

Ray Dalio on Reality and the Holy Grail

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Ray Dalio is the hedge fund industry’s E.F. Hutton – when he talks, people definitely listen.

That’s what a packed audience did intently when the Bridgewater Associates founder offered some of his investment wisdom in a rare public appearance Thursday at the Bloomberg Markets 50 Summit in New York.

Dalio, who runs the largest hedge fund in the world with over $120 billion in assets under management, started off by talking about what makes him successful when asked by Bloomberg’s Eric Schatzker.

“Understanding what reality is and how reality works; reality works in a certain way,” Dalio said. “Given that reality works that way, what is my principle for dealing with reality ... a principle means how to deal with reality to get the result you want.”

Dalio then outlined one of his company’s “principles” - that gained notoriety in a recent New Yorker magazine profile about his hedge fund - which he called “the Holy Grail,” and has guided him as a macro investor through the years.

“If you have 15 or more good, uncorrelated return streams, the math of that is such that if you go from one to two uncorrelated streams, you would reduce your risk by 80 percent,” Dalio said.

Dalio also weighed in on the European debt crisis, saying there is “no surprise” what is happening now overseas, and was beaming about the Federal Reserve.

“If the markets are going to rally, and things are going to be good, it is going to be the Fed that will come in to save us,” Dalio said.

His emergence at the Bloomberg conference seemed to signal a more open Ray Dalio but he retreated back to his media-shy shell when he didn’t take questions from the audience, and he declined an interview with HedgeFund.net afterward.

Trader Arrested In Connection with UBS’ $2B Loss

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London police have arrested a UBS trader in connection with a $2 billion loss suffered by the Swiss bank.

Kweku Adoboli was charged with committing fraud by abusing his position and false accounting, The Wall Street Journal reported.

The $2 billion in losses using the firm's own money raised new questions about the ability of one of the world's largest banks to manage risk, and global regulators' ability to monitor it.

Risk-control officers at UBS discovered unauthorized trades allegedly made by Mr. Adoboli, who then admitted to the trades by sending an e-mail to managers at the bank.

UBS have been trying to fix its crippling situation since 2008, when the financial crisis hit the industry hard, and deal with recent losses that have added to firm’s already-dire circumstances.

Earnings at UBS fell to 1 billion francs in the second quarter, from 2 billion francs during the same period a year earlier, according to The New York Times.

Go to Wall Street Journal article

Go to New York Times article

BlueMountain Names New CEO for European Sector

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Credit-focused hedge fund firm BlueMountain Capital Management has named a new CEO for the firm’s European sector.

David Rubenstein joined the company in 2006 and will continue as BlueMountain’s global chief financial officer and general counsel, the firm said in a statement Tuesday.

Rubenstein will also work out of the London office as part of the firm’s business expansion into Europe. He succeeds Jeffrey Kushner, who is retiring from the firm.

BlueMountain also announced that it has hired two London-based senior credit analysts, Adam Feldheim and Jonathan Moore, and Noam Leslau, BlueMountain managing director, is being transferred to London to join the firm’s UK offices' business development team.

BlueMountain, a hedge fund with offices in London and New York, has $7 billion in assets under management.

NJ Court Dismisses SAC Capital from Lawsuit

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A New Jersey Superior Court judge has dropped SAC Capital from a five-year-old civil suit brought by a Canadian insurance company.

Toronto insurer Fairfax Financial sued hedge fund manager Steven Cohen’s firm and other firms in 2006, accusing them of conspiring with investment banks, journalists and shady operatives to spread false information about the company and profit from shorting its shares.

However, Judge Stephen Hansbury ruled that SAC held long positions while others allegedly shorted Fairfax stock, according to the New York Post.

The other firms still involved in the lawsuit include Dan Loeb’s Third Point Management and Jim Chanos’ Kynikos Associates.

Go to New York Post article

Related Stories
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Employee Movement in Goldman’s Quant Unit

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Goldman Sachs’ quant funds unit is going through some employee shakeups.

The head of Goldman’s global quantitative investment strategies group is retiring while three her position will be split among two executives, according to the New York Times.

Katinka Domotorffy will leave the firm at the end of this year after 13 years of service, working her way up from portfolio researcher and manager to chief investment officer for Goldman while heading the quant group.

Taking over as chief investment officer is Ron Hua, who joins Goldman from PanAgora Asset Management, and heading the global quantitative business is 26-year Goldman employee Armen Avanessians, the Times reported.

Also two other Goldman executives, Bill Fallon and Don Mulvihill, will also oversee investment strategies within the group.

Go to New York Times article

Louisiana Police Looks for New FoF

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Louisiana State Police Retirement System is looking to hire a fund-of-funds manager.

The manager will run approximately $10 million, and funding for the new hire will come from fund manager GAM, according to a Pensions & Investmentsreport.

GAM was reportedly released from its business relationship with the pension last week due to poor performance.

Go to Pensions & Investments article

HFN Strategy Focus Report: Statistical Arbitrage

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Click here to read the full report.

Overview: Statistical Arbitrage
The HFN active and inactive databases contain over 60 unique fund products with a primary investment strategy focused on statistical arbitrage. The commercial database contains 16 active funds, 2 of which are structured as UCITS. HFN tracks an additional 9 unique funds which focus on volatility arbitrage which have characteristics similar to statistical arbitrage strategies. Performance and Equity Volatility

•Statistical arbitrage funds were +1.72% in July and -1.23% YTD 2011. This compares to +0.37% YTD for equity hedge fund strategies, +4.60% for credit, -0.50% for commodity strategies and +0.72% for the broad hedge fund industry.
•Volatility arbitrage strategies were -0.30% in July 2011 and -1.85% YTD 2011.
•HFN estimates total hedge fund assets invested in statistical arbitrage strategies were $32.43 billion at the end of July 2011.

Statistical arbitrage (stat arb) strategies vary widely in terms of position holding time horizon and style, but the similarity across all of these funds is the fully quantitative nature of trade construction and execution. Position holding periods vary from fractions of seconds where algorithms attempt to find opportunity in market microstructure dynamics, to days or even weeks when the perceived arbitrage opportunities are geared towards mean reversion across similar securities. Lastly, stat arb is often part of larger, multi-strategy platforms which indicates the AUM is spread beyond pure stat arb funds.

Statistical Arbitrage and other Quantitative Fund Characteristics
The aggregated qualitative details of statistical arbitrage strategies in the HFN database give an indication of the collective characteristics of the group in the entire industry.

•There is a larger than average concentration of stat arb funds operating out of Europe than the U.S. Paris in particular is home to a larger than normal percentage of funds.
•Stat arb fund launches peaked in 2007 before stalling during the financial crisis. Launches resumed in 2009 and remained elevated through 2011.
•The average stat arb entity has $317.8 million in strategy assets, compared to the average equity strategy size of $207.8 million and average industry aggregate size of $333.04 million.
•Half of the stat arb funds listed on HFN explicitly denote market neutrality as central to their strategy.

Total Asset Levels and Flows Estimates
Despite the presence of new fund launches stat arb AUM has meaningfully declined since reaching a post crisis peak in early 2010.

•HFN estimates total assets invested in stat arb strategies at the end of July 2011 were $32.34 billion. Early estimates for August show AUM likely increased during the month counter to the broad industry.
•Total AUM has decreased 16% in the first seven months of 2011, or $5.9 billion. AUM decreased 3% in 2010 after climbing to an all-time peak of $42.5 billion in March of that year.
•Performance has reduced AUM an estimated $670 million in 2011 which indicates an asset weighted performance of -1.64%. Comparing this figure to the equal weighted performance of -1.23% indicates larger funds stat arb funds have performed worse than smaller funds in 2011.
•Stat arb investors have withdrawn an estimated $5.3 billion for a core decline of 14% compared to a core increase of 2.5% for the overall industry.

Performance and Equity Volatility
Figure 10 shows the returns of statistical arbitrage funds, relative to equity strategy performance, compared to the VIX. Monthly VIX averages were calculated using daily close figures.

•In relatively volatile environments, measured by monthly VIX over the historical average, statistical arbitrage funds tend to outperform equity strategies. The converse also holds true; in calm environments statistical arbitrage funds tend to underperform equity strategies.
•Since 2002, statistical arbitrage funds outperformed equity strategies by +0.62% on each month the monthly VIX was above its historical mean, on average. Below average monthly VIX showed underperformance for statistical arbitrage funds of -0.72% relative to equity strategies.
•Early 2009 was an exception to this trend, possibly attributable to managers’ beliefs of sustained volatility in the equity markets following the financial crisis.
•The trend is even more pronounced when measured against the change in volatility measured as month over month change in monthly VIX averages. Upward sloping volatility showed a +0.97% (+1.22%) outperformance by statistical arbitrage (volatility arbitrage) funds compared to equity strategies and a -1.22% (-1.38%) underperformance in downward sloping volatility environments.

Going Forward
Although recent media coverage of “black box” strategies may leave statistical arbitrage out of favor with certain investors, contained variance and relatively low correlations to other more common hedge fund strategies (see page 5) make it an attractive option.

Despite recent trends in investor sentiment, the current environment may be a boon to statistical arbitrage funds with investors looking for safe harbors in relative value strategies. Equity markets were volatile in August with upward VIX movement contrasting sharply with recent history. It seems statistical arbitrage funds were better positioned than most showing an early estimate of -0.08% compared to equity strategies posting -4.33% for the month. The coming months will be crucial for statistical arbitrage funds with accurate interpretation of uncertain markets, on an absolute basis and relative to other funds, required to stem the momentum behind further redemptions.

Click here to read the full report.

Jonkoping tränares hedge fund Launch delayed

Hedge Fund launch of Highbridge capital, former head of the Asia investment has been delayed by a Hong Kong s.a.r. supervisory authority.

Hong Kong's securities and Futures Commission is investigating allegations that Carl Huttenlocher and others who worked with him at Jonkoping, incorrectly valued illiquid assets during the 2008 financial crisis, and afterwards, according to an article in the Wall Street Journal.

Huttenlochers new Hong Kong s.a.r.-based hedge fund company, Myriad asset management, was scheduled to start trading on Sept. 1 with 300 million dollars in assets.

Huttenlocher managed a $ 1.4 billion Asian Fund for Ramsey, owned by JP Morgan Chase, until he left the company in March last year.

Go to the Wall Street Journal article

Related articles
J?nk?ping Asia Chief leaves to Start their own company

Doubleline Fund reaches $ 10B AuM

Hedge Fund Manager's Jeffrey Gundlach fixed DoubleLine sees its bond fund reach 10 billion dollars in assets under management.

The Fund was set up in April 2010 is managed by DoubleLine CEO Jeffrey Gundlach and company President Philip Barach, the company said in a statement last week.

Los Angeles-based Doubleline have 15 billion dollars AuM overall, and manages hedge funds and mutual funds, separately managed accounts.

Bond with the Fund's success comes at a time when Doubleline is in the middle of a current case in Los Angeles court where Gundlachs former employer TCW sue him for Doubleline right after his firing in December 2009 with staff it from TCW.

Related articles
Gundlach vs. TCW playing in L.A. Court

Sky Bridge hires new head of international operations

New York hedge fund company Sky bridge capital has hired a former Director of the World Economic Forum as new CEO for its international activities.

The company announced Tuesday that Max von Bismarck also has joined Sky bridge as a partner. He was formerly Vice President and Director for investors at the WEF, Switzerland-based economic think tank known for its exclusive, annual meeting in Davos.

Von Bismarck will be based in Zurich, where he will have oversight of Sky bridges business and marketing activities for his flagship fund of funds, sowing and Hedge Fund Advisory services throughout Europe, the Middle East, Asia and Australia.

Sky Bridge capital has about 8 billion dollars in assets under management.

Hedge Fund Advisor gets five years

The Securities and Exchange Commission has placed a five-year ban on a New York hedge fund adviser from carrying out any future activities.

Robert Feinblatt, founder of the now defunct Trivium Capital Management, can restore to the SEC after five years, according to a regulatory ruling last week.

Feinblatt and Trivium analyst Jeffrey Yokuty (which had three year ban) were charged in January in Manhattan Federal Court trading on inside information.

Two were connected to the Government informant capacious Khan, a longtime associate of convicted hedge fund manager Raj Rajaratnam.

The SEC charged that Feinblatt and Yokuty received inside information from Khan for trade in the shares of Polycom, hotel chain Hilton, Google and Kronos, the business software company.

Federal prosecutors claimed Khan had received information from Sunil Bhalla, a leading executive business videoconferencing Company Polycom, Shammara Hussain, an employee at investor relations consulting firm market Street partners.

The ban is part of the final judgment against Feinblatt, covering him pay off the SEC over 2.6 million dollars in fines.

Yokuty and Hussain of also have been ordered to pay fines, while Bhalla struggling SECS legal action against him.

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HFN strategy focus report: Event driven/special situations

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Overview: Event Driven & Special Situations

The HFN active and inactive databases contain nearly 400 unique fund products with a primary investment strategy focused on event driven and special situations. The commercial database contains 225 products, 67% of which are unique with 4 of the unique products structured as UCITS.

•The HFN Event Driven Index was -1.09% in June and +1.42% YTD 2011. This compares to +0.65% YTD for equity hedge fund strategies, +4.06% for fixed income, -2.50% for commodity strategies and +0.39% for the broad hedge fund industry.
•HFN estimates total hedge fund assets invested in event driven and special situations (ED/SS) strategies were $515.41 billion at the end of Q2 2011.
•HFN estimates there were 80 ED/SS funds launched in 2010 against 24 liquidations. There had been a net decline in ED/SS funds the prior two years.

ED/SS strategies focus on a variety of objectives and typically utilize a combination of equity and debt related securities. The majority of special situations funds refer to the same catalysts that event driven strategies exploit which is why the groups have been combined in this report for asset flow and performance measures. In addition to shared catalysts including M&A, spin-offs, regulatory changes, share buybacks, changes in capital structure, etc., the group often also has distressed situations as targets. The remainder of this report breaks down ED/SS classifications to elucidate performance differentials.

Event Driven & Special Situations Fund Characteristics
The aggregated qualitative details of event driven and special situations strategies in the HFN database give an indication of the collective characteristics of the group in the entire industry:

•New York is the most common city in which ED/SS strategies base their operations exceeding the popularity of other cities by a wide margin. This is paralleled by the U.S. being the most common country for operations.
•ED/SS fund launches peaked in 2007, but the group also had the second largest % decline in fund counts during the financial crisis behind fixed income arbitrage.
•The average ED/SS entity has $440.5 million in strategy assets, compared to the average equity strategy size of $203.7 million and average industry aggregate size of $314.4 million.
•While the majority of the current crop of ED/SS funds invest in the entire capital structure, a slightly smaller group focuses primarily on equity investments.

Total Asset Levels and Flows Estimates
Event driven and special situation fund AUM increased rapidly in 2010 following above average performance in 2009. More recently, volatile equity markets appear to have led investors to reduce exposure to the group.

•HFN estimates total assets invested in ED/SS strategies at the end of Q2 2011 were $537.1 billion. Early estimates for July show continued, but muted, performance losses and an uptick in redemptions.
•Total AUM has increased 4.1% in the first six months of 2011, or $21.1 billion. AUM increased 26% in 2010 and 49% in 2009.
•Performance accounted for a $6.9 billion increase and investors added net $14.1 billion in the first half of 2011.
•Despite the influx of assets, the recent trend is negative. In Q2, performance reduced AUM $6.3 billion and investors redeemed a net $4.2 billion.
•The rate of AUM change due to performance has led the ED/SS benchmark through July which is an indication that larger funds (which have a smaller representation) have outperformed smaller funds during the year.

It is not surprising to see rising net redemptions from the group in the last three months. ED/SS funds were one of the earliest to return to net inflows following the financial crisis and had one of the three highest core growth rates in 2010 behind only fixed income and merger arbitrage. Increased volatility in equity markets has negatively influenced allocations to directional equity related strategies and ED/SS funds have been affected. The bulk of net inflows to the group resulting in its rapid post-crisis growth were from June 2009 through May 2010.

Performance by Product Size
Figures 6-8 show returns for ED/SS funds by fund size over the last 24 months (Figure 6) and over the last 5 years (Figures 7-8). Asset groups are defined by fund $AUM at the beginning of the period to best quantify returns by actual fund size at the time of initial interest.

Returns by strategy assets differ slightly. ED/SS entities appear to have a higher concentration of managed accounts and so actual fund size may not be the best indication of the size of an ED/SS operation.

•Mid-sized ($100-$500 million) ED/SS funds outperformed all other asset groups at every percentile ranking. This varies from the industry where smaller funds exhibit the highest upside and the largest funds show the most controlled downside.
•The group, assessed over the last 12 months using assets in strategy, maintained the aforementioned trend. ED/SS entities with over $500 million in strategy assets averaged 9.55% over the LTM while those with assets between $100 and $500 million averaged 14.91%.
•Looking back 5 years, the largest ED/SS funds outperformed smaller funds pre-crisis, but under-performed post-crisis. Contrary to the rest of the hedge fund industry, it was not the smallest ED/SS funds which rebounded fastest post-crisis, rather the mid-size $100-$500mm funds.

Performance by Regional Focus
Figures 9-12 break down the performance of ED/SS funds by their primary regional exposure, or the region in which their event driven strategies are focused.

•Event driven strategies with targeted regional exposures have outperformed each corresponding regional benchmark in 2011.
•In the last twelve months, only event driven strategies with exposures to Australia trailed their regional benchmarks. In the last two years, only Aussie and EM funds have trailed their regional hedge fund benchmarks.
•In the last twelve months, U.S. focused ED/SS funds had the most impressive spread between top 10th percentile and 75th percentile. A/P focused funds had the highest bottom 90th percentile, but failed to produce high top percentile rankings.
•ED/SS emerging markets performance appears to be more beneficial than broad EM exposure in volatile markets (comparing 2011 to the last 2 years which includes the broadly positive second half of 2009), but in no specified time frame has ED/SS emerging markets exposure produced meaningfully better results than ED/SS U.S. exposures.

Performance by Market Sector Focus
Figures 13-14 break down the performance of ED/SS funds by primary industry exposure. For the most part, ED/SS funds do not specify a focus on a particular industrial sector, but those that do tend to focus on the resources/energy, healthcare, finance and technology sectors, in that order.

•In both the last twelve months and YTD 2011 time frames, sector specific exposure appears to have benefited healthcare and natural resource focused ED/SS funds compared to non-sector focused ED/SS strategies. However, only natural resource ED/SS strategies outperformed the average corresponding sector specific EQ fund.
•The average finance sector ED/SS fund has underperformed all relevant comparisons. Looking within the sample, there is one product which has outperformed the average finance sector equity funds in 2011, but performance is still below the average of all ED/SS funds.

With the exception of resources strategies, sector specific ED/SS funds appear to have been unable to outperform their EQ sector specific counterparts. Additionally, outperformance over non-sector specific ED/SS funds seems to be due to sector specific exposures and may not necessarily come from sector specific ED/SS expertise.

Going Forward
There are several factors influencing the outlook for the ED/SS space. Corporations, at least in the U.S., have an increasing amount of cash on their balance sheets. A recent publication of corporate cash balance indicators from the Association of Financial Professionals (AFP)1 showed that more firms had increased the levels of cash on corporate balance sheets both from Q1 to Q2 in 2011 and year-over-year from Q2 2010 to 2011. Additionally, corporate borrowing costs are near the lowest levels in 10 years (but slightly off these lows through August) as seen by Aaa rated corporate rates and the spread between Aaa and Baa rates.

Despite the large amount of cash on hand and low borrowing costs, the current volatile global economic and political climates have likely reduced the attractiveness of deploying cash. Alternatively, sharp declines in equity markets can make share repurchases and takeover targets more attractive. However, neither is likely to be accelerated until volatility declines. This confluence of factors, combined with the rapid increase of AUM in the ED/SS space throughout the end of 2009 and 2010 indicate investors believed an active event driven environment would persist.

For equity oriented investors, outside of market neutral strategies, and despite being in negative territory on average, event driven funds are holding up relatively well. Both equal and asset weighted performance estimates for the last three months through July show that event driven strategies have outperformed equity market indices, the average long/short equity strategy and the aggregate average of all hedge funds. This is a firm indication that amid recent volatility there is still some level of support in the event driven markets.

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HFN industry report: July 2011

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HFN industry overview: July 2011

August 23, 2011 with 3,518 hedge fund products, reporting, were index HFN Hedge Fund total + 0.36% in July and + 0.78% YTD in 2011, while the S & P 500 Total Return Index (S & P) was-2.03% during the month and + 3.87% YTD.

Hedge fund industry highlights July:
• Total industry assets increased approximately 0.26% to $ 2.567 trillion in July. Performance accounted for the majority of asset growth. net investment flows were negative for the month.
• Commodity and FX exposures that the main part of the very positive performance in July. Funds with primary exposure to metals markets returned an average of over 8%.
• Fixed income strategies performed again, equity funds, return the latter posting negative average for the third month.
• Mortgage sector funds continued to produce above average yields and average monthly positive performance for 32 months.
• Japan focused funds posted its second consecutive positive overall results since the natural disaster in March and the Group showed slightly positive in 2011.

Global markets continued on the edge in July ahead of the bad economic and political news from the United States together with the European debt issues continued to spread throughout the region. These negative trends have been positive for certain currencies, including the AUD, CAD, CHF and JPY. Rally on U.S. Treasury markets was a blessing to high yields and EM debt strategies.

HFN developed outliers ratio to determine which sectors producing returns outside of their normal ranges. In July, it was the commodity and FX strategies surprising that positive and equity sector focused (real estate, economy, health care), perform well, worse than average.

HFN regional benchmarks
Funds investing primarily in Russia and Australia tend to most closely track the performance of some commodity markets (energy, agriculture and metals). In July, this resulted in Russia and Australia, producing the best regional results, + 2.39% and + 1.75%, respectively. Funds investing in China and over many regional markets in Asia performed above the average in July, with India is the exception.

The economies of both India and Brazil have faced with high inflation and must be counteracted by increasing certral bank lending rates. For Brazil focused funds, have the result in 2011 poorly performing stock markets, but strong credit markets. Brazilian equity funds returned an average of-3.20% in July and-0.23% in 2011, while fixed income strategies was + 1.90% in July and + 8.93% in 2011.

For the second month, focused Australia funds declined more than any other developed market, falling-3.03% in June. The Group continued to be hurt by the fall in commodity prices and again failed to surpass the ASX under a down month, previously a rarity for Australia focused funds.

Monthly access Flow estimates
• Estimated Total hedge fund assets at the end of July 2011 was $ 2.567 trillion, an increase of 0.26%, or $ 6.8 billion from June.
• Performance accounted for an increase of 20.9 billion dollars and investors accounted for a net outflow of 14.1 billion dollars.
• The most important growth/decline (% access change because investors appropriation/redemption) were-0.55%, the first core decline since June 2010 and the largest since the beginning of 2009.
• Total the notorious AUM still 14% over the historically high in Q2 2008.

NET output in July was a continuation of the trend in Q2 marked three months of declining growth. Despite net outflow and the trend of decline, the industry still took in an estimated 55.0 billion dollar net new award 2011.

Some sector specific feeds
• The flow of assets to Japan focused funds resumed in July, but at a moderate pace compared with two months after the earthquake.
• The need was a jump in redemption from emerging market strategies in July, led by a large net outflow of funds investing in new Europe. Grandmothers focused resources also experienced a net reduction in AUM from investors.
• Commodity strategies had a payout for the second consective month and both capital and credit strategies investors experienced net outflows.
The Angel far above average industry returns in 2011, there was a net redemption of mortgage sector funds in July.
• On a policy level, had the only multi-platform strategy and convertible arbitrage NET investors allocations in July. Regulation d and option strategies, experienced the highest levels of depression.

Performance Review
Fixed income (FI) strategies
• The average return of all fixed income focused strategies was + 0.55% in July and + 4.16% for the current year.
• Emerging credit market strategies done best in July, + 0.87%, followed by mortgage sector funds, + 0.67%.
• Fixed income assets fell 0.82% in July to an approximated 690.5 billion dollars. Investors redeemed NET 7.8 billion dollars during the month.

Equity (EQ) strategies
• The average return all capital focused strategies was-0.29% in July and + 0.25% YTD.
• Natural resource sector funds led all others in July, + 1.42%. Health sector funds performed worst,-0.98%, followed by technology and financial sector funds-0.92% and-0.91%, respectively.
The assets of • Equity fell an estimated-1.06% to 834.8 billion dollars in July. Investors redeemed NET 8.6 billion dollars during the month.

Commodity and foreign exchange (FX) related strategies
• Broad natural resource commodity strategies was + 2.52% in July and + 0.59% YTD.
• Funds that invest in metals markets that went from the biggest losers in June to produce the highest returns in July, + 7.20-%. FX strategies increased an average of + 1.30%. Both groups have given negative average yields this year.
The decline in equity markets, funds targeted at financial futures rose + 2.57% in July.

Summary analysis
Effects of broad market uncertainty materialized in hedge fund flows in June and has been featured with meaningful exchange in July. The decisions to allocate or redeem generally is present or even a month earlier return data indicating Julius redemption is a reflection of May and June performance. Historically tend flows to reverse faster with positive return means August is likely to see net inflows on the back of Julius returns, but there is still a high degree of uncertainty in global markets which should keep inflows turned off.

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Highland Cap opens new Korea Office

Dallas-based hedge fund firm Highland Capital Management announced it has opened a new Office in South Korea.

The company's new Web site in the Seoul Central Business District will be led by investment veteran Chris Yoon.

Yoon will handle Highlands operations and investor relations in Korea. Yoon and his team will also report to the company's Asia-Pacific Regional office, based in Singapore.

Yoon connect Highland with previous experience in Seoul investment firm Asia Pacific capital, Macquarie Securities Korea and KPMG Samjong investment advisory.

James Dondero, President and founder of Highland, said expansion in Korea was to meet "strong demand" for Highlands investment products in one of Asia's "top growth areas."

Highland, acting in several investment strategies, has about 23 billion dollars in assets under management.

Wall Street Trader was sentenced to 66 months

A former Wall Street trader sentenced to 66 months in prison for insider trading.

Drimal also was convicted on Wednesday by u.s. District Judge Richard Sullivan to three years of supervised transition and ordered to pay more than 11 million dollars in fines, according to Manhattan's U.S. Attorney's Office.

Craig Drimal pleaded guilty to five counts of securities fraud and one count conspiracy back in April.

Prosecutors charged that Drimal made over 10 million dollars from trading on inside information obtained from the recently convicted hedge fund manager, Zvi Goffer, two lawyers from the company law firm ropes & Gray, and a third lawyer who had his own company.

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The Citadel employees allegedly fired for passing confidential Info

Chicago-based hedge fund Citadel has allegedly fired an employee who has been accused of installation of unauthorized applications on the Citadellets computer system before you move the confidential information to foreign computers.

Quantitative financial engineer Yihao Ben Pu was also fired Tuesday for "repeatedly lying to Citadel on its activities", Crain's Chicago Business reported.

In addition, said Citadel phone records prove that Pu have been in contact with a rival, Teza technologies about job opportunities.

A judge ordered Mr. Pu not to use or disclose any confidential information or destroy evidence, but did not ask him to immediately reverse the property claims of the Citadel, according to Crain's Chicago Business report.

The Citadel has 11 billion dollars in assets under management.

Go to Chicago Business article

SEC freezes assets of Hedge Fund

The Securities and Exchange Commission has frozen the assets of Chicago-area money manager and his quant hedge funds.

The SEC on Wednesday charged Belal Faruki and his fixed neural markets with lying to potential investors in his company's start-up hedge funds.

The SEC said, from January 2010 through October 2010 Faruki distorted allegedly on hedge fund performance track record, misstated that 5 million dollars has already been invested in the Fund for wealthy investors, and incorrectly that he had invested his own money into hedge-fund.

The SEC also charged that the Farukis system will cost one of the Fund's investors of $ 1 million.

HK billionaire family backs of RAB Deal

Hong Kong billionaire Choi family has supported the plan to obtain funds from the troubled hedge fund RAB Capital.

A source close to the London-based hedge fund RAB is happy to continue running the said funds which it intended to sell to Suhwah, conglomerate family, according to Choi's Financial Times.

The collapse of the deal came my rapeseed declining market losses and has no financial impact on hedge fund, even though RAB will need to review its plan to reduce the activity around one of its main resources, reported the Financial Times.

RAB has approximately $ 1 billion in assets under management.

Go to Financial Times article

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Einhorn-Mets Deal falls apart

Hedge fund manager David Einhorn attempts to acquire a minority stake in the New York Mets baseball franchise failed.

Einhorn statement a Thursday for an end to the exclusive negotiations with the Mets, blaming it on "comprehensive art changes" that the affair grew up in "last minute" Although he did not get into details.

Einhorn, the head of the 5 billion dollar hedge fund firm Greenlight capital, had been in negotiations with the Mets since May to buy a game for an investment of $ 200 million.

Team owner Fred Wilpon and Saul Katz offered a game in the team to cover liabilities, and expenses, due in part to a $ 1 billion lawsuit from Irving Picard, trustee of Bernard Madoff bankruptcy cases for their alleged involvement in Madoff's Ponzi scheme.

But the reports came out this week that the agreement was supposed to take place at the end of June would not close before the end of August.

Einhorn, a longtime Red Sox fan, please be courteous on the negotiations.

"I want to thank the entire Mets organization and Major League Baseball for their efforts. This experience will always be a happy memory for me because of the Mets fans, "said Einhorn in the expression.

Mets ownership in an official statement said "Mets ownership has decided to explore other options" to find a minority investor and has enough capital to cover all 2011 losses. The ownership also Einhorn thanked for "his interest is considering this opportunity."

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Hedge fund managers each receive $ 111 M fine

Cayman Islands Grand Court fines two hedge funds managers 111 million dollars each for their role in the collapse of their companies.

Stefan Peterson and his Ekstr?m by the now defunct London-based hedge fund Weavering Capital, which also had a Cayman Islands office, was found guilty by the Court of "wilful neglect or default in performance of their duties", reported the HFM week.

Losses incurred by the company are superseded by the company, however, the Court had substantial evidence that the couple avoided their professional duties.

Before the company closed 2009 for only 90 million dollars of 223 million dollars in the request for redemption, had Weavering 639 million USD in assets under management by HFM week.

Go to HFM week article