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Tech hedge fund targets institutional money
Thu Jul 24, 2008 8:07am BST
By Dane Hamilton

NEW YORK (Reuters) - The former chief technology strategist for
JPMorgan Chase (JPM.N: Quote, Profile, Research) and a partner are
reaching out for institutional investors after generating solid
returns over two years at their family-and-friends-financed hedge
fund.

Christie Street Capital, a firm named for the Edison, New Jersey,
street where Thomas Edison made globe-changing inventions, is looking
to raise several hundred million dollars or more for the technology-
focused fund, people familiar with the firm said this week.

Christie Street was founded by Greg Geiling, former top-ranked
Institutional Investor telecoms equipment analyst at JPMorgan who was
promoted to chief tech strategist in 2001. His partner, Andrew
Berliner, is a former managing director at hedge funds Ark Asset
Management and NorthStar Capital Funds.

The firm, which currently has less than $50 million (25 million
pounds), has generated returns of nearly 21 percent since inception
in August 2006, according to an investor note obtained by Reuters.

The firm is looking for institutional money at a time when tech
investing is somewhat out of favour compared with last year. The
Morgan Stanley Technology Index .MSH, which includes many major tech
stocks, has fallen over 20 percent from a peak last fall.

Still, one analyst said the firm could attract investor interest for
fund of funds and others looking to allocate capital to the
technology sector.

"Tech is not really in favour right now, but if Christie Street has a
verifiable track record and can convince prospective investors that
it will deliver alpha (above market returns), it should be able to
attract interest," said Dan Farkas, hedge fund analyst at Morningstar
Inc (MORN.O: Quote, Profile, Research). "Investors like alpha in just
about any form."

Christie Street executives declined to comment.

According to marketing materials, the firm plans to generate net
returns of 12 percent to 15 percent per year through a portfolio of
40 to 60 long and short positions in the technology sector.

It said it is particularly focused on "disruptive" technologies that
could cause significant market shifts prior to investment by retail
investors.

It didn't name any particular stocks it plans to buy, but said it
would short the companies whose technology could be thwarted by new
innovations and go long on those offering promising new technologies.

"Christie Street believes that there are a number of emerging
innovations within the TMT (technology, media and telecom) sectors
that will result in significant market dislocations over the coming
years," it said in the marketing materials obtained by Reuters.

Some technology sectors include digital advertising, wireless
applications, Internet video, broadband and others, it said.

The fund generated returns of 5.92 percent in the first half of 2008,
well above a similar benchmark, the Hedge Fund Research
Technology/Healthcare index, which lost 3.35 percent for the period.
In 2007, it posted returns of 10.29 percent, according to an investor
note.

The firm uses Goldman Sachs (GS.N: Quote, Profile, Research) as its
prime broker.


© Thomson Reuters 2008. All rights reserved. Users may download and
print extracts of content from this website for their own personal
and non-commercial use only. Republication or redistribution of
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Reuters. Thomson Reuters and its logo are registered trademarks or
trademarks of the Thomson Reuters group of companies around the world.

Funds of hedge funds look to global macro for gains
Tue Jul 22, 2008 2:29pm BST
By Nigel Davies

LONDON (Reuters) - Funds of hedge fund managers are looking to global
macro funds to try and steer clear of the mess thrown up by the
credit crisis while cautiously dipping their toes in a small pool of
more risky assets, a Reuters poll found.

Stormy markets have torn through the hedge fund market this year,
forcing many to shut up shop and others to tumble, but most have
still managed to keep well ahead of the severe double digit losses
suffered by global stock markets in the first half of the year.

The quarterly survey of 13 managers which invest in a basket of hedge
funds and manage a total of around $150 billion in assets showed
global macro funds leading the way through 2008 as they tend to
benefit from periods of high volatility.

Typically such funds bet on the direction of markets, currencies or
debt, and commodities.

"We have all been complaining for three plus years about the lack of
risk premia everywhere and the lack of volatility. Well, be careful
for what you wish for," said Mike Hennessy, managing director of
investment at Morgan Creek Capital Management in North Carolina.

Just two strategies, global macro and multi-strategy arbitrage, were
forecast to provide above average returns in the second half of 2008,
roughly in line with the April poll, but down on the five strategies
predicted to excel back in January.

Indeed, turbulent markets have proved a double-edged sword for hedge
funds this year. Hedge Fund Research reported that 170 funds
liquidated in the first three months of the year, up from 138 funds
that closed in the same period last year.

But losses have not been as bad as many perceive. HFR's fund of funds
composite index fell 2.54 percent to the end of June, some way off
the 13.8 percent the MSCI World Index fell in that period.

Managers in the survey said investment diversification, being short
financials -- betting they will fall further -- and any allocations
to energy-related sectors had helped portfolios this year. They have
also held high levels of cash.

Oil prices rose from around $115 a barrel at the time of April's
survey to rally over $147 in July. They have since fallen back
sharply to around $130 a barrel.

The credit crisis has been a bruising experience for hedge funds, and
for many banks -- shares of Swiss financial heavyweight UBS have
plummeted 53 percent so far this year. But the crunch has also
offered up investment ideas.

"The greatest financial crisis in our lifetime has created excellent
opportunities for the next one to five years," said Hennessy,
highlighting senior bank loans, certain structured debt and
distressed debt as areas to consider.

EMERGING SINKING

Indeed, the survey showed that managers increased their allocations
to distressed debt slightly over the last quarter.

Such strategies offer increasing investment opportunities as
corporate defaults rise.

In contrast, managers are growing more wary of emerging markets
strategies to which they have reduced their allocations and forecast
no relief in the coming two quarters.

This was only the second survey since the poll started in 2004 where
emerging markets were estimated to post below average returns.

"We are in a time where we need to protect capital than take big
risks. If we invest now it would be like catching a falling knife,"
said Christophe Chrun, fund manager at Dexia Asset Management in
Paris.

That would appear a wise move as the HFR Emerging Markets Index fell
close to 7.0 percent in the first six months of the year, making it
one of the worst performing hedge fund strategies, but still above
the MSCI Emerging Markets index which lost around 13 percent in that
time.


© Thomson Reuters 2008. All rights reserved. Users may download and
print extracts of content from this website for their own personal
and non-commercial use only. Republication or redistribution of
Thomson Reuters content, including by framing or similar means, is
expressly prohibited without the prior written consent of Thomson
Reuters. Thomson Reuters and its logo are registered trademarks or
trademarks of the Thomson Reuters group of companies around the world.

Singapore fund management assets up 32 pct in 2007



Reuters - Thursday, July 24SINGAPORE, July 24 - Assets managed by
fund managers in Singapore grew 32 percent to S$1.173 trillion ($860
billion) last year, driven by a doubling in assets held by hedge
funds, the central bank said on Thursday.



"This is the seventh consecutive year of double-digit year-on-year
growth in total assets under management registered by Singapore-based
asset managers," the Monetary Authority of Singapore said in a
statement.

Singapore has invited asset managers, private banks and hedge funds
to boost its fast-growing financial industry as it tries to reduce
the economy's reliance on manufacturing.

UBS <UBSN.VX>, Credit Suisse <CSGN.VX>, U.S. bank Citigroup <C.N>,
Deutsche Bank <DBKGn.DE>, Morgan Stanley <MS.N> and Britain's HSBC
<HSBA.L><0005.HK> are some of the leading players in private banking
and wealth management in Asia and all of them run large businesses in
Singapore.

MAS said 43 percent of funds came from institutional investors such
as pension funds, endowments, foundations, companies and financial
institutions.

Assets managed by hedge fund managers doubled to close to S$80
billion, while the number of hedge fund firms in Singapore increased
by more than 50 percent to almost 300, MAS said.

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Perella Weinberg Fund Gains on Distressed Investments (Update1)

By Pierre Paulden and Katherine Burton


July 18 (Bloomberg) -- Perella Weinberg Partners' Xerion hedge fund
rose 24 percent this year on distressed investments and wagers that
the debt of financial-services firms would fall, according to a
letter sent to investors.

The $837 million fund, which invests in the shares and debt of
troubled companies, has outperformed competitors, which have lost 1.6
percent on average in the first half of 2008, data compiled by
Chicago-based Hedge Fund Research Inc. show.

There will be more chances to invest in companies going into or
emerging from bankruptcy because of increasing losses at Wall Street
banks and a slowing U.S. economy, said Daniel Arbess, New York-based
Xerion's founder and a Perella partner. Lending opportunities will
also rise.

``We expect the present distressed-credit cycle to be deeper and
longer than the preceding one in 2002,'' wrote Arbess, since
companies laden with debt will have to contend with a ``moribund U.S.
economy, a smaller financial system with much tighter credit
underwriting standards, and a globally induced cost-price squeeze
that erodes their profitability.''

The Xerion fund is also looking to provide financing to companies
unable to get loans as Wall Street cuts back on providing debt and to
investors forced to sell assets.

``The fact that we have avoided recent losses in credit and have
fresh powder makes us liquidity providers to both companies unable to
obtain conventional financing, and to investors looking to raise
liquidity themselves by selling what they can,'' Arbess wrote in the
letter.

Costlier Financing

Companies with high-risk, high-yield debt are having to pay more to
obtain financing after the price of the average actively traded loan
fell from above face value last June to 87.8 cents on the dollar,
according to Standard & Poor's LCD. The extra interest investors
demand to own high yield, or junk, bonds, rather than Treasuries has
widened to 779 basis points from 241 basis points last June,
according to Merrill Lynch & Co.'s U.S. High-Yield Master II index.

Joseph Perella, former Morgan Stanley merger-and- acquisitions
banker, and Peter Weinberg, who previously ran Goldman Sachs Group
Inc.'s European business, founded Perella Weinberg in 2006. The firm
bought Xerion in October to expand an asset-management business.

Perella Weinberg invested $100 million in the fund, according to a
statement from the firm in October. Xerion returned 38 percent in
2007.

Xerion, started in 2003 with backing from Greenwich, Connecticut-
based hedge-fund firm Paloma Partners LLC, has returned 24 percent
annually since inception.

Laggard Funds

Two of the oldest distressed-debt hedge funds have lagged behind
Xerion's returns.

David Tepper, head of Chatham, New Jersey-based Appaloosa Management
LP, lost 16.5 percent this year through June 30 in his Palomino Fund
Ltd. Tepper's investments included bankrupt auto-parts maker Delphi
Corp. The fund has returned 25 percent a year on average since it was
started in December 1994.

New York-based Cerberus Capital Management LP, run by Stephen
Feinberg, returned just 0.5 percent in its Cerberus International
Ltd. hedge fund in the first half of the year. That fund has returned
about 14 percent on average since it started in May 1993.

Executives from the firms declined to comment or didn't return calls
seeking a comment.

Separately, Victor Consoli, former co-head of credit strategy at Bear
Stearns & Cos., joined Xerion in June as a senior member of the
investment team, according to the letter.

To contact the reporters on this story: Pierre Paulden in New York at
ppaulden@...; Katherine Burton in New York at
kburton@...

Last Updated: July 18, 2008 08:55 EDT

Japan's Pension Fund Boosts Hedge Fund Investments (Update1)

By Tomoko Yamazaki and Komaki Ito

July 10 (Bloomberg) -- Japan's Pension Fund Association has lifted
its hedge fund investments sixfold in less than a year as part of
efforts to boost returns from a wider range of holdings on its $122
billion of assets.

The fund has put 300 billion yen ($2.8 billion) into hedge funds and
aims to increase that to about 4 percent of total assets, Tomomi
Yano, executive managing director of the government-backed agency,
said in an interview in Tokyo yesterday, declining to specify a
timeframe for the goal.

``We've been aggressively increasing investments mainly in about top
50 hedge funds in the U.S.,'' Yano said after attending an annual
conference organized by the Economist Intelligence Unit in Tokyo.
``The returns have been decent.''

Institutional investors like pension funds are putting more money
into hedge funds, which aim to make money in rising and falling
markets, even as the industry had its worst start to a year in 18
years, to boost returns after the U.S. subprime loan crisis. A
quarter of Japan's population will receive pension benefits by 2025,
the government estimates.

Japan's Pension Fund Association manages more than 13 trillion yen of
retirement assets for individuals who quit mid- career from one of
its more than 1,400 member companies. The agency enjoyed a return of
5.6 percent in the year ended March 2007 and 23 percent the previous
year, according to the company Web site.

Wider Range

Yano said in June 2006 the fund may try to boost returns by
diversifying investments to include hedge funds, funds of funds and
private equity. The fund began investing in hedge funds in the second
half of last year with about 50 billion yen, according to Yano. It
aims to boost its hedge fund investments to about 500 billion yen,
according to Bloomberg calculations.

Hedge funds turned in their worst first-half performance in almost
two decades as the collapse of subprime-mortgage bonds and rising
commodity prices pushed stocks to the brink of a bear market, data
compiled by Hedge Fund Research Inc. showed. Hedge funds declined by
an average of 0.7 percent in June, bringing the year-to-date loss to
0.75 percent, the worst start to a year since the Chicago-based firm
began tracking returns in 1990.

Hedge funds are mostly private pools of capital whose managers
participate substantially in the profits from their speculation on
whether prices of assets will rise or fall.

The association has hired two professionals to oversee its hedge fund
and private equity investments, Yano said. The agency has invested
about 60 billion yen in private equity deals, which it aims to
account for about 2 percent of assets, he said.

Alternative Investments

The agency allocated 36 percent of assets to domestic bonds, 28
percent to domestic equities, and about 33 percent to overseas stocks
and bonds as of March 2007, according to its Web site.

Investors, reeling from more than $400 billion in writedowns and
credit losses worldwide from the U.S. subprime collapse, are shunning
equities on concern that rising commodity prices will slow global
economic growth and boost the rate of inflation.

The MSCI World Index that tracks the shares of more than 1,700
companies fell 14 percent this year, headed for its first decline in
six years.

``There is no doubt that pension funds globally are starting to
invest more in alternative investments,'' said Mitsushige Akino, who
manages about $560 million at Ichiyoshi Investment Management Co. in
Tokyo as chief investment officer. Investors ``are reluctant to
invest in global equities, and hedge funds are taking up that
money.''

Real Estate

The amount U.S. pension funds invested in hedge funds increased 51
percent in 2007 from a year earlier, while in Japan it rose by a
third, according to Masashi Toshino, a senior researcher on the
industry at Daiwa Fund Consulting Co. in Tokyo, citing data from
Pension & Investments, a New York-based provider of financial
industry data, and Japan's pension fund association.

California Public Employees Retirement System, the largest U.S.
public pension fund, in June last year announced plans to double its
allocation to activist and hedge funds to more than $10 billion each.

Japan's largest private-sector pension fund manager has no plans to
invest in commodities, which the fund classifies as an alternative
investment along with real estate, Yano said, because raw material
prices are open to speculation and are too volatile.

As for real estate investments, Yano said land prices in Japan have
started to reach fair value after the bubble era of the late 1980s
and early 1990s, allowing the pension fund to consider investments,
Yano said.

``Our current focus is to diversify our investments,'' said Yano.
``Japan has finally caught up to consider real estate as a possible
investment in the alternative asset class.''

To contact the reporters on this story: Tomoko Yamazaki in Tokyo at
tyamazaki@...; Komaki Ito in Tokyo at kito@...

Last Updated: July 10, 2008 00:04 EDT

Man Group's Funds Managed Increase to $79.5 Billion (Update2)

By Ambereen Choudhury

July 10 (Bloomberg) -- Man Group Plc, the world's largest publicly
traded hedge fund manager, said assets under management rose 6.6
percent to a record in the past three months as clients added money
and investments gained.

Man rose as much as 3.3 percent in London trading after the firm said
funds under management climbed to $79.5 billion at the end of June
from $74.6 billion three months earlier. Investors put in a net $2.5
billion, up from $1.5 billion in the year- earlier period, the
company said.

The ``update is very positive,'' said Merrill Lynch & Co. analyst
Philip Middleton, in a note to clients today. He's keeping his
``buy'' recommendation on the stock. ``In current conditions, this
underlines Man's attractiveness.''

Man drew in money even as the hedge fund industry turned in the worst
first-half performance in almost two decades. Hedge funds declined by
an average 0.75 percent in the six months through June, data compiled
by Hedge Fund Research Inc. show. It's the worst start to a year
since the Chicago-based firm began tracking returns in 1990.

Man gained 14 pence, or 2.4 percent, to 603.5 pence by 10:46 a.m. in
London, valuing the company at 10.4 billion pounds ($20.5 billion).
The stock has advanced 6.1 percent this year, the best performance
among the 71 companies on the Bloomberg Europe Banks and Financial
Services Index.

Funds Gain

Man Group's AHL Diversified Plc fund gained 3.8 percent in the three-
month period, followed by the Glenwood fund, which climbed 2.4
percent, the company said. Sales for the quarter amounted to $5
billion, while clients withdrew $2.5 billion.

``Demand for our fund products has remained strong, both from private
investors and institutions,'' said Chairman Jon Aisbitt in a
statement to be made at the company's annual general meeting today.

Hedge funds are mostly private pools of capital whose managers
participate substantially in the profit from their speculation on
whether the price of assets will rise or fall. Hedge funds typically
keep 20 percent of investment gains as performance fees.

Started as a sugar trader in 1783, Man Group uses a bank of computer
servers to determine AHL's investments in more than 200 commodities
futures markets around the world.

To contact the reporter on this story: Ambereen Choudhury in London
at achoudhury@...

Last Updated: July 10, 2008 05:57 EDT

Hedge funds' tumble the worst in 2 decades
Thursday, July 10, 2008
BY KATHERINE BURTON AND SAIJEL KISHAN
BLOOMBERG NEWS
Hedge funds turned in their worst first-half performance in almost
two decades as the collapse of subprime-mortgage bonds and rising
commodity prices pushed stocks to the brink of a bear market.

Hedge funds declined an average 0.7 percent in June, bringing the
year-to-date loss to 0.75 percent, data compiled by Hedge Fund
Research show. It's the worst start to a year since the Chicago-based
firm began tracking returns in 1990. The $1.9 trillion industry has
posted one losing year, in 2002, when funds fell 1.45 percent amid
the 23 percent decline by the Standard & Poor's 500 Index.

Managers attracted a net $16.5 billion during the first three months
of the year, down from $30.4 billion in the fourth quarter, Hedge
Fund Research reported. Investors have become less tolerant of losses
and are shifting assets to traders who have shown they can thrive in
turbulent markets, said Antonio Munoz, who runs EIM Management USA in
New York, which farms out $15 billion to hedge funds.

"We don't see investors pulling the plug across the board and putting
their capital into cash," Munoz said.

Hedge funds are mostly private pools of capital whose managers
participate substantially in the profits from their speculation on
whether the price of assets will rise or fall.

Joseph Oughourlian's Amber Capital Management and Polygon Investment
Partners are among the firms hurt by redemptions. Amber Capital had
$2.5 billion of withdrawals as of July 1 after the New York-based
firm dropped 9.5 percent in the first half, according to investors.
Oughourlian, who focuses on companies going through corporate changes
such as mergers, oversaw $6.6 billion at the start of the year. The
fund returned 38 percent in 2006 and 13 percent in 2007.

London-based Polygon, co-founded by former UBS AG hedge- fund chief
Paddy Dear, had redemptions of about $1.5 billion this year through
May as its Global Opportunities fund lost 4 percent.

"Investors are showing less patience than before to live through the
bad times," said Patrik Safvenblad, head of hedge-fund research in
Stockholm for DnB NOR ASA, Norway's biggest bank.

Assets in Renaissance Technologies' institutional equities fund, run
by James Simons, declined 25 percent, to $15 billion this year as the
fund dropped 8.5 percent and clients withdrew cash, investors said.
Almost all the money went into the East Setauket, N.Y.-based firm's
institutional futures fund, which has climbed 8.6 percent this year
and now has $7 billion.



With reporting by Tom Cahill and Alexis Xydias in London. Editors:
Larry Edelman, Tim Quinson.




© 2008  The Star Ledger
© 2008 NJ.com All Rights Reserved

Bigger may be better as smaller hedge funds give up
Tue Jul 8, 2008 8:38am BST
By Svea Herbst-Bayliss

http://uk.reuters.com/articlePrint?articleId=UKCAS82703720080708


BOSTON (Reuters) - Bigger may really be better for hedge funds at a
time the $2 trillion (1 trillion pound) industry's smaller players
face tough choices of either merging or being forced out of business.

In the first six months of 2008, more than a dozen smaller funds have
already agreed to let larger players own a piece of them, and
investors and managers expect that pace to quicken.

Man Group (EMG.L: Quote, Profile, Research), the world's largest
publicly traded hedge fund group, has taken stakes in Ore Hill
Capital and Nephila Capital, while Goldman Sachs' (GS.N: Quote,
Profile, Research) Petershill unit has taken stakes in Capula
Management, Claren Road Asset Management and Trafalgar Asset Managers.

"What we are finding is that managers of varying sizes are either
merging with or selling a stake in their businesses to larger
institutions," said Ron Geffner, who works with hedge funds as a
partner at law firm Sadis & Goldberg. "And in many cases the primary
reason is to gain access to better infrastructure and distribution."

While many hedge funds once operated with only a few people out of a
basement or garage, bigger investors who have helped double the
industry's assets to $2 trillion in the last three years are
demanding more for their money.

Risk management, legal departments and top-notch back office
operations are must haves for big name investors like the
Massachusetts state pension fund, trustees and fund officials said.
That fund plans to put more money into hedge funds in the months
ahead.

For smaller funds managing only a few million dollars these types of
costs can put them out of business very quickly, several small fund
managers said.

"The costs of entry into the hedge fund industry have always been
very low, but the costs of remaining in business are very high,"
Philip Duff, chief executive officer of Duff Capital Advisors said,
adding "the odds are probably as good as running a restaurant in
Manhattan."

Duff announced plans last week to integrate hedge fund North Sound
Capital, the first of a string of expected joint ventures this year.
For years Duff wooed hedge fund teams to FrontPoint Partners but then
sold that company to Morgan Stanley in 2006.

Adding fresh pressure to small fund managers these days are industry
studies that show big investors tend to prefer more seasoned and
larger hedge funds over the start-ups even though other data show new
funds tend to outperform older ones.

"There seems to be a change of allocation strategy among some
institutional investors to larger hedge fund firms as global
investors who have been rattled by the markets sense these bigger
funds offer more perceived security," Sadis & Goldberg's Geffner said.

But there may also be a silver lining for bigger funds as they
consider growing by integrating smaller players: there arelots to
choose from.

"The environment for recruiting investment talent is the best it has
been in 20 years," Duff Capital's Duff said.


© Thomson Reuters 2008. All rights reserved. Users may download and
print extracts of content from this website for their own personal
and non-commercial use only. Republication or redistribution of
Thomson Reuters content, including by framing or similar means, is
expressly prohibited without the prior written consent of Thomson
Reuters. Thomson Reuters and its logo are registered trademarks or
trademarks of the Thomson Reuters group of companies around the world.

Thomson Reuters journalists are subject to an Editorial Handbook
which requires fair presentation and disclosure of relevant interests.

Hedge funds turn lives into a game

By Will Hutton
THE OBSERVER, LONDON
Monday, Jul 07, 2008, Page 9

http://www.taipeitimes.com/News/editorials/archives/2008/07/07/2003416
690


Two years there was a music festival at Knebworth, in central
Britain, that was very different. At "Hedgestock" 4,000 hedge fund
managers and investors paid US$1,000 a ticket for a weekend of
rock'n'roll, champagne, laser clay pigeon shooting and seminars on
arcane aspects of how to make even more millions. Some wore beads as
part send-up, part veneration of Woodstock, 1960s hippies
and "hedgies" bound by the bond of anti-establishment love of
liberty, as if the aims of getting stoned and making a fortune
gambling in unregulated financial markets were curiously united. The
Who played out the event, with proceeds going to the Teenager Cancer
Trust.

"Hedgies" were the cool face of capitalism. This year, a rerun of
Hedgestock would be pilloried and rightly so. Oil prices are
spiraling higher and the plight of stricken banks, property companies
and housebuilders is made more acute because of hedge funds'
aggressive speculation. Late last month there were fresh fears that
the Western financial order simply could not cope and global stock
markets reeled. Hedge funds are emerging as one of the triggers of a
first order crisis.

The scale of speculation is eye-poppingly huge. Since Hedgestock,
hedge funds have become ever more important. The worldwide industry
manages US$2 trillion in assets and a leading hedge fund manager told
me they are only a third into their growth cycle — another US$4
trillion is to come. One cynic mocked that the only unifying
definition of hedge funds is that they are vehicles to enrich the
people risking others' money; with a 2 percent management fee and a
20 percent share in any investment profits, they certainly do that.

Hedge funds are rich enough to attract any of the great names in
investment management and investment banking. New York has more than
120 hedge funds managing more than US$1 billion each, with London
running it a close second with more than 80, mainly based in the
exclusive areas of Mayfair, Knightsbridge and Belgravia. Some 200
hedge fund partners in London make US$40 million a year, but for the
partners who do well, annual earnings can be many times higher. In
2006 Nathaniel Rothschild made US$240 million from his Atticus
Capital, while last year George Soros's Quantum fund returned 32
percent and netted him US$2.9 billion.

Their pitch to investors — from insurance companies to company
pension funds, sheiks, Russian oligarchs, the British aristocracy and
anybody with sufficient cash — is simple. They set out to make a
return of 30 percent a year any way they can in no-holds-barred,
hyper-aggressive financial gambling. They take positions in any
share, financial instrument or commodity you can name. When they were
small you could argue they were a justifiable irritant, challenging
and punishing governments and companies alike, who had got themselves
into unsustainable financial positions. But now they are becoming the
mainstream, degrading the operation of capitalism, turning it into a
casino, reducing people's lives to the chips.

It is fashionable among commentators to regard the UK's Labour
government as the epitome of uselessness, but occasionally there are
signs of life. HBOS bank, Britain's largest mortgage lender, and
Bradford & Bingley bank have come under organized attack from hedge
funds as they try to raise money from their shareholders. Their
shares were being sold to force down the price before being bought
back — "short-selling."

British Chancellor of the Exchequer Alistair Darling and the UK's
Financial Services Authority announced that sellers should disclose
their identity. The results are revelatory. The hedge funds were not
even buying back the shares, they were "borrowing" them from pension
funds to manipulate the market. Ten percent of the shares in Bradford
& Bingley were in play, with HBOS only marginally less under siege.
Darling flushed the speculative princes of the hedge fund world —
Harbinger, Tiger Global Management, GLG — into the open.

A spotlight has been shone on some very murky corners of the
financial markets. There practices occur that challenge the very
conception of what we consider a company to be, and the accompanying
obligations of ownership. A multibillion dollar business has emerged
in which shareholders lend their shares to hedge funds to be played
with. For a tiny fee, a hedge fund will arrange to borrow shares from
a great insurance company or pension fund which it proceeds to sell.
Share-loans are believed to exceed a stunning US$15 trillion.

What then happens is the opposite of a bubble, a kind of financial
black hole. The hedge funds sell the shares simultaneously and the
downward movement becomes self-reinforcing, with companies raising
money during a rights issue particularly vulnerable. This is why the
government forced disclosure. The hedgies reacted as if they were in
Stalin's Russia; their freedom to kill a company stone dead was being
challenged. Let's not mince words, that is the aim and it gets ugly
and personal. A senior UK official told me that in one case some
hedge funds had allegedly warned the banks underwriting one rights
issue to abandon it or face speculative attack — Mafia practice.

Neither are companies raising money the only target. A visit to the
Data Explorers Web site (www.dataexplorers.com) gives you some idea
of the extent of the nightmare. For example 10 percent of the shares
in UK housebuilder Barratts have been borrowed to be sold. Chief
executive Mark Clare said he thought his company was the victim of a
sellers' conspiracy. So it was, and is.

Hedge funds say they are only exposing real frailties and that if the
shares are undervalued, long-term investors will buy them. But
financial markets do not work like that. They create bubbles and
black holes of excess optimism and pessimism, which hedge funds set
out to exaggerate. The impact on companies is devastating. British
firms no longer have long-term owners who share their long-term
mission and purpose. Instead their owners have become their enemies;
as Clare says, hardly motivating.

US senators Joseph Lieberman and Susan Collins have been holding
hearings to investigate why the oil price is so high. One witness,
hedge fund manager Michael Masters, argued that there were two
identifiable sources of new demand over the past five years — from
China and from speculation — both around the same scale. Without the
speculation the oil price would still be below US$100 a barrel.

The senators are proposing that hedge funds, along with other
speculators, should be prohibited from oil speculation — and they
mention London by name. They said it is hedge funds in London's
unregulated oil futures markets that are making middle America pay
twice as much for its gasoline.

That is probably over the top, but there is a truth there. The price
of gasoline and the toughness of the credit crunch are being
increased by the operation of hedge funds, as is the weakening of
your job prospects as companies are forced into ever harsher
behavior. It does not have to be like this; the necessary changes in
the markets and corporate ownership are fairly easy to make. They
would make it harder for some very rich people to get even richer,
but in the US and mainland Europe politicians are ready to
contemplate that, partly to defend the legitimacy of capitalism
itself. Only in Britain is nothing said, a sign, I think, not of our
economic maturity, but political emasculation.

GLG Partners hires Goldman Sachs partner - newspaper


http://uk.reuters.com/article/hedgeFundsNews/idUKCAS72721720080707


PHILADELPHIA (Reuters) - GLG Partners has hired Goldman Sachs partner
Driss Ben-Brahim, who oversees the firm's emerging-markets trading,
the Wall Street Journal newspaper reported in its electronic edition
on Sunday.

GLG, a British hedge fund run by several former Goldman partners,
targeted Ben-Brahim to help expand its special-situations business,
the Journal said.

The job will include running the roughly $1.2 billion (600 million
pound) emerging-markets special-situations fund that is now run by
Greg Coffey, the GLG fund manager who is leaving the firm in October,
the newspaper said.

GLG had about $24.6 billion of assets as of the end of March, the
newspaper said.

GLG and Goldman Sachs could not be immediately reached for comment.

Hohn's charity reinvests bulk of Ł800m back in his own fund
Activist investor's children's foundation has so far made
disbursements of less than 5% of its value

By Jeremy Warner
Tuesday, 8 July 2008

http://www.independent.co.uk/news/business/news/hohns-charity-
reinvests-bulk-of-163800m-back-in-his-own-fund-862070.html




Virtually all the Ł800m endowment built up by Christopher Hohn, the
activist investment manager, to fund philanthropic causes has been
reinvested back in his own hedge funds, analysis of recently filed
accounts reveals.


Despite the now very considerable assets of Mr Hohn's charitable
foundation, only Ł11.7m was last year spent on charitable activities,
the biggest single disbursement being to the William Jefferson
Clinton Foundation's HIV/Aids initiative. Mr Hohn's charity, the
Children's Investment Fund Foundation (CIFF), lists 18 disbursements
on its website, bringing the grand total of commitments to Ł34.6m.

According to the accounts, Ł767m of the market value of the
Foundation's endowment is represented by a holding in The Children's
Investment Fund Ltd, Mr Hohn's hedge fund business.

Mr Hohn, 41, has been reported as giving sums to charity that "dwarf"
previous donations and hark back to the Victorian traditions of
philanthropy. Mr Hohn is a trustee of the foundation, as is his wife,
Jamie Cooper-Hohn, who is also its chief executive.

A spokesman for CIFF said that the foundation paid no management fee
for its participation in the hedge funds and was free to take its
money out at any time. Other high performance investment alternatives
charged fees and typically involved "lock-ins".

He said it was hard to imagine an alternative investment strategy
that would have created as much value for the foundation. Despite
reports that the fund's performance has stalled in the recent
financial turmoil, the spokesman said the foundation was "very happy"
with its current investment strategy. The reason the foundation,
which aims to deliver large-scale, long-term transformational
advances for children, has grown so large is because of the 50 per
cent per annum compound rate of return Mr Hohn's fund delivers. In
the accounts, the trustees are reported to be "fully satisfied with
the current investments and their allocation".

The Children's Investment Fund, one of the most aggressive investment
activists on the corporate scene, was set up in 2004 for the specific
purpose of funding the Foundation.

The spokesman said that the apparently low level of disbursements was
explained by the fact that it is logistically difficult to donate
such a large endowment in an effective manner. The Foundation hoped
to announce two $50m donations this summer. He stressed that it was
important that the still relatively young foundation spent its money
wisely in a manner which delivered clearly defined objectives, rather
than throwing it down the drain, as with some non-government
organisations.

A spokesman for the Charity Commission said that following recent
meetings with the trustees, it was satisfied that there were plans in
train for substantial disbursements.

A third of the fund's investment management fees are contracted to go
to the foundation, together with a further third if the fund returns
more than 11 per cent. More importantly, the foundation also receives
the fund management group's entire 15 per cent "carry", or bonus on
investment performance, once other partners and staff have taken
their cut.

To date, virtually all these monies have been reinvested in the hedge
fund.

Last year, CIFF Trading, a subsidiary of the foundation, received a
profit share of Ł276m from the fund. In addition, the foundation
received Ł126m in investment gains. Subsequent to receiving the
money, CIFF Trading made donations to the Foundation under Gift Aid
of Ł276m. Typically, charitable donations can be offset against tax.

Mr Hohn is said in notes to the accounts to be the manager
responsible for some of the foundation's investments. Neither he, nor
any other trustee, are paid anything for their work for the
foundation.

It is unusual for the investments of charities to be heavily
concentrated with a single fund management group. Making it doubly
unusual is the fact that Mr Hohn, one of five trustees, is also
responsible for managing the money. The Foundation is none the less
in full compliance with Charity Commission rules and believes
strongly that no principle of good corporate governance has been
breached.

Unlike many high performance hedge fund managers, Mr Hohn lives
comparatively modestly, with no private jet, yacht or any of the
other usual accoutrements of the super-rich.

One defender says that the defined purpose of his investment
activities – to improve the lot of deprived children – is absolutely
genuine, and warns that criticism of money-making for philanthropic
purposes only creates disincentives to such activity. "This is no
marketing gimmick."

The accounts detail additions to the Foundation last year of Ł335m
and investment gains on the existing endowment of an astonishing
Ł126.4m. Despite the growing size of the "expendable endowment", it
generates only negligible income, again unusual for a charity.

Since founding The Children's Investment Fund five years ago, Mr Hohn
has become known as one of Britain's most aggressive activist
investors, having helped to bring about the break-up of ABN Amro, the
Dutch bank, as well as the departure of the chief executive of
Deutsche Borse, the Frankfurt stock exchange. More recently, he has
been involved in acrimonious proxy battles with CSX, the US railroad
company, and J-Power, one of Japan's biggest power utilities.

One of his rivals says of him: "He's arrogant and belligerent, but
there is no doubting his money making skills. All fund managers
eventually get their come-uppance, and Hohn has made a lot of
enemies. You can't walk on water for ever. But for the time being his
returns are spectacular."

The TCI "masterfund", said to have around $12bn under management,
returned 41.95 per cent in 2004, 49.66 per cent in 2005, and 38.99
per cent in 2006. Last year is said to have been outstanding too.

However, against the recent backdrop of turbulence in financial
markets, even Mr Hohn's performance has suffered. In the first
quarter, the fund was down nearly 10 per cent, and in an email which
has come to light as a result of recent US court filings, Mr Hohn
wrote that the fund could soon be down 15 per cent.

In separate emails, Mr Hohn complained that many of his positions had
not been sufficiently hedged.

Donations to the Foundation are made through Mr Hohn's so-
called "carry", a standard feature of most hedge funds that entitles
the managers to a set proportion of any profits, typically 20 per
cent. However, if the fund falls in value, the managers get nothing
other than the management fee.

Hedge funds hit troubled banks with a hiring binge
By James Mackintosh and Chris Hughes
www.Ft.com
Published: July 7 2008 20:02 | Last updated: July 7 2008 20:02

The biggest hedge funds are on a hiring binge, taking advantage of
cutbacks at investment banks to recruit star traders, senior
executives and whole teams to help them expand.

On Monday Goldman Sachs lost Driss Ben-Brahim, one of its top
traders, to GLG Partners, London's second-biggest hedge fund. This
follows high-level recruitment from banks by Citadel, Tudor
Investment, CQS and other well-known funds.

"The environment in investment banks is such that they don't feel as
secure where they are," said Peter Clarke, chief executive of Man
Group, the biggest listed hedge fund manager. "It is materially
helpful to us."

Many of the biggest hedge funds are still flush with cash, in spite
of well-publicised problems for some funds facing investor
withdrawals or investment mistakes.

And they look increasingly appealing for staff at investment banks
facing falling bonuses, a clampdown on expenses and widespread job
losses.

"People who a year ago I couldn't get two minutes on the phone with,
suddenly they are free for lunch," said Chris Gaunt, a principal at
Heidrick & Struggles, the headhunters.

"A lot of the senior executives at the big banks are not going to
have much fun and they're not going to make much money.

"The hedge funds are increasingly well-positioned to hire and to hire
very well."

The rescue of Bear Stearns has provided a particularly rich seam of
talent for hedge funds after half the staff lost their jobs under new
owner JPMorgan.

Tudor, based in Greenwich, Connecticut, hired a Bear distressed-debt
team, run by Gregory Hanley and Alan Mintz, while Chicago-based
Citadel took three senior executives from JPMorgan as part of its
rapid expansion plans.

London-based CQS has taken on 45 new people this year, it said,
boosting its Hong Kong office, operations and trading as well as
taking support staff such as computer specialists.

"You can get whomever you want," said the head of one large London
hedge fund.

"Goldman is in good shape but it is the easiest time ever to hire
people from Merrill Lynch, Morgan Stanley, even Deutsche. Forget
about everything else: at these banks it is just not fun any more."

London's Marshall Wace is also expanding, saying two weeks ago that
the troubles at the investment banks create a "great opportunity" to
hire talented staff.

Of course, hedge funds have long been an attractive destination for
traders, with the chance to earn far more money if they are
successful, while ditching suits and ties for jeans and designer
shirts.

When investment banks were doing well during the recent bull market,
there were big attractions to traders in staying put.

Expectations were lower and they were less likely to be fired for a
month or two of poor performance.

With cost-cutting now the main focus of many troubled banks, they
have become both less attractive places to work and less secure.

But there is another factor making them less appealing: banks are
cutting back the capital they are willing to risk, leaving traders
with less money to run and so fewer opportunities to earn a bonus, as
the banks refocus away from risking their own proprietary money to
serving clients.

So far, this trend has been felt most acutely in the fixed income
business. But, according to one divisional global head of a leading
investment bank, these trends will soon start hitting business lines
that have so far held up relatively well.

"Investment banks still have some way to go in reducing leverage.
That should have an impact on commodities, currencies and equities,
regardless of how well the markets hold up," he says.

Copyright The Financial Times Limited 2008

Larch Lane Advisors (NY)
Skybridge Capital (NY)
Investcorp
Hardt Group
RMF: they use to seed managers, but I dont know if they still have the program
running.


--- In hedgefunds123@yahoogroups.com, sterlingmanagers <no_reply@...> wrote:
>
> --- In hedgefunds123@yahoogroups.com, "raincrowd" <raincrowd@>
> wrote:
> >
> > hi all! just looking for advice here... who's the best "go-to" guy to
> > find seeders and incubators for a fund? i have a commodity/fx start-up
> > fund that needs capital.
> >
> > thanks.
> >
> >
> > ramon
> >
>
> Send me info
>

--- In hedgefunds123@yahoogroups.com, "raincrowd" <raincrowd@...>
wrote:
>
> hi all! just looking for advice here... who's the best "go-to" guy to
> find seeders and incubators for a fund? i have a commodity/fx start-up
> fund that needs capital.
>
> thanks.
>
>
> ramon
>

Send me info

hi all! just looking for advice here... who's the best "go-to" guy to
find seeders and incubators for a fund? i have a commodity/fx start-up
fund that needs capital.

thanks.


ramon

TANKING BANKS' DEBT SOUGHT BY $1B FUND
By MARK DeCAMBRE

Last updated: 7:35 am
July 3, 2008
Posted: 3:39 am
July 3, 2008
www.nypost.com


Hedge fund Highbridge Capital Management is trying to raise $1
billion from wealthy investors for a fund focused on buying bank
assets hammered by the credit crisis.

According to one investor who was considering committing funds, the
planned Highbridge Leveraged Loan Partners will require prospective
investors to commit to a three-year period during which they are
precluded from pulling out their money. Marketing of the fund began
about a week ago, this person said.

Highbridge, which JPMorgan Chase took a controlling interest in about
four years ago, hopes to take advantage of the plummeting prices of
bank paper that has been originated over the past year and a half.

A Highbridge spokeswoman declined to comment.

Domestic and foreign financial institutions, including Citigroup,
Deutsche Bank, Merrill Lynch and UBS, last summer were among a long
list of firms with more than $400 billion in bank debt on their
books, and though most have whittled through much of that backlog,
many still have a long way to go toward off-loading that paper.

Firms such as Highbridge and Fortress Investment Group and affiliated
funds runs by Goldman Sachs have been aiming to scoop up much of that
bank debt on the cheap and reap a profit over time.

JPMorgan's investment in Highbridge has helped it become one of the
largest US hedge fund managers, though as of late Highbridge's
performance has been lackluster, according to reports.

Highbridge investors pulled more than $8 billion from two so-called
statistical-arbitrage mutual funds last year, according to press
reports.

mark. decambre@...

Goldman grabs prime brokerage business
Credit crunch, Bear debacle, triggers flight to quality among hedge
funds
By Alistair Barr, MarketWatch
Last update: 1:56 p.m. EDT July 2, 2008SAN FRANCISCO (MarketWatch) --
The credit crunch and near-collapse of Bear Stearns has triggered
a "flight to quality" in the prime brokerage business as hedge funds
shift assets to the largest, most financially stable investment and
commercial banks, experts said this week.
Prime brokers lend money and securities to hedge funds, process and
clear their trades, take care of their assets and provide many other
backup services to managers, including risk management, reporting and
technology support.
It's a lucrative business that was dominated by Morgan Stanley
(MSmorgan stanley com new
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MS) , Goldman Sachs (GSGoldman Sachs Group, Inc
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GS) and Bear Stearns.
But when Bear almost collapsed and had to be saved by J.P. Morgan
Chase (JPMJPMorgan Chase & Co
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JPM) in March that changed. Many hedge funds worried they might not
be able to get their assets back quickly if Bear went bust. So
managers moved assets away from the struggling brokerage firm to
rival firms.
Goldman may have been the main beneficiary of this shift, while
Morgan Stanley and Deutsche Bank (DBdeutsche bank ag namen akt
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DB) also probably grabbed new clients and assets.
Goldman's Securities Services business, which includes the firm's
prime brokerage unit, generated record net revenue of $985 million
during its fiscal second quarter. That was up 36% from a year
earlier.
"That's amazing," said Josh Galper, managing principal of Vodia Group
LLC, a consulting firm focused on prime brokerage and securities
lending. "There's been a flight to quality in prime brokerage because
of a general concern about the credit quality and stability of
brokers following the collapse of Bear Stearns."
"Many, but not all, hedge funds have had multiple prime brokerage
relationships for years. When one prime broker appears to be in
trouble, it's not difficult for clients to move their accounts to
another prime broker," he explained. The revenue growth in Goldman's
Securities Services division reflects this clearly."
Vodia estimated in late June that Goldman became the largest prime
broker by assets under custody and leverage extended to hedge fund
clients, taking over from Morgan Stanley.
Still, Morgan Stanley's prime brokerage business also had a
successful fiscal second quarter, with strong revenue and average
customer balances up slightly from the previous quarter, Chief
Financial Officer Colm Kelleher told analysts during a conference
call in June.
Deutsche Bank also benefited, partly because it's a commercial bank
with access to more stable customer deposits, according to Galper.
In the past year, Deutsche's prime brokerage business has won more
than 150 new clients and is generating record revenue in 2008,
according to a spokesperson for the German bank.
However, all is not lost for J.P. Morgan, which was attracted to Bear
partly because of the firm's large prime brokerage business, Galper
said.
Some hedge funds probably kept their accounts at Bear Stearns, but
shifted all their assets and money to rival prime brokers, he
explained.
"The fact that Goldman had a spectacular quarter does not mean that
clients of Bear have closed their accounts," Galper said. "If J.P.
Morgan can show good customer service and stability some customers
may move some of their balances back."
Mini-prime brokers
Even if some hedge funds do return to Bear, the credit crunch has
encouraged most managers to set up accounts with more prime brokers.
The average hedge fund has 1.7 prime brokers currently, but that's
expected to increase to three in coming years, according to Jack
McDonald, chief executive of Conifer Securities, which provides back-
office services and other support to hedge funds.
Big prime brokers are also "squeezing the tails" of their client
rosters, eliminating accounts of some hedge funds that don't generate
enough revenue, McDonald said.
That's creating a booming market for so-called mini-prime brokers,
which service small to medium-sized hedge funds that are increasingly
being shunned by the largest firms.
Shoreline Trading Group, Merlin Securities, BTIG and Acceleration
Capital Group are some of the smaller prime brokers that have
sprouted in recent years. Conifer is also considering entering the
mini-prime brokerage business.
For Goldman, this trend doesn't mean it loses out on all the revenue
opportunities from serving smaller hedge funds though.
Most of the mini-prime brokers clear their clients' trades through
Goldman, McDonald noted.
Alistair Barr is a reporter for MarketWatch in San Francisco.

Icahn's Activist Funds' Slim Returns Supply Cause to Deactivate

By Katherine Burton


  July 3 (Bloomberg) -- Carl Icahn has hit the roughest patch of his
hedge-fund career.

His $7.9 billion in hedge funds fell 7 percent between October and
April, the biggest peak-to-trough loss since the funds opened in
November 2004, according to investors. That compares with an average
annual return on his investments of 53 percent from 1996 to mid-2004.

Icahn has lost money on cellular-phone maker Motorola Inc., his
biggest investment. The 72-year-old billionaire also failed to
persuade executives at Yahoo! Inc. and Biogen Idec Inc. to take his
advice for boosting their stock prices.

While falling equity markets and the slowing economy are beyond
Icahn's command, the setbacks at Yahoo and Biogen don't bode well for
his future as an activist shareholder, said Brett Barth, a partner at
New York-based BBR Partners, which has invested $1 billion in hedge
funds for clients.

``When you have been unsuccessful as an activist, it emboldens
companies to be combative,'' Barth said.

Icahn has so far come up short in his efforts to force Sunnyvale,
California-based Yahoo, owner of the second-most- popular online
search engine, to sell itself to Microsoft Corp. He also lost a proxy
battle this month to elect his candidates to the board of Cambridge,
Massachusetts-based Biogen, making a sale of the world's biggest
maker of multiple sclerosis drugs less likely.

Icahn declined to comment on his investments and performance. The
funds rose 6.3 percent during the past 17 months, compared with a 1.5
percent increase in the Standard & Poor's 500 Index.

Trailing Rivals

His funds trail activist investor Daniel Loeb's New York- based Third
Point Offshore Fund, which gained 17.4 percent during the same
period. Chris Hohn's TCI Fund Management LLP, which staged a proxy
fight at railroad CSX Corp., returned 37 percent in the same period.

The mediocre returns are a comedown for Icahn, who has earned
billions as a corporate raider, including the 1985 takeover of Trans
World Airlines Inc. He made $893 million trying to break up RJR
Nabisco Holdings Corp. in the 1990s.

Icahn generated a 53 percent annual return on invested capital from
January 1996 to May 2004, according to documents used in 2004 to
market his New York-based hedge funds. In 2006, the Icahn Fund rose
about 29 percent, while the U.S. benchmark Standard & Poor's 500
Index advanced 13.6 percent.

Since then, Icahn has struggled. He paid about $2.3 billion, or
roughly $13 a share, for his 7.6 percent stake in Schaumburg,
Illinois-based Motorola, according to a filing in May with the U.S.
Securities and Exchange Commission.

Motorola Seat

Icahn made an unsuccessful bid for a board seat last year. Motorola
Chief Executive Officer Gregory Brown has bowed to pressure to spin
off the handset unit and focus on television set-top boxes, two-way
radios and wireless networking equipment. Motorola shares closed
yesterday at $7.15 in New York Stock Exchange composite trading.

Icahn paid an average price of $18.46 for shares of real- estate
developer WCI Communities Inc. in Bonita Springs, Florida, and his
offer to buy the rest at $22 was rejected last year by management. He
did win three board seats last August and was named chairman. WCI
Communities fell 18 cents yesterday to $1.31.

His biggest success was BEA Systems Inc. this year. Icahn bought
shares of the San Jose, California-based software company for $12.81
a share, on average, and then pressed BEA and bigger rival Oracle
Corp. to merge. Oracle bought BEA in April at $19.38 a share,
producing a return for Icahn of about 50 percent in less than a year.

`Lumpy Returns'

``All these activists are going to have lumpy returns,'' said Brad
Alford, head of Alpha Capital Management LLC in Atlanta, which farms
out money to hedge funds. He considers Icahn ``one of the best
activists out there.''

When Icahn said he was buying Yahoo shares with the goal of getting
the company to agree to a purchase by Microsoft, John Paulson's
Paulson & Co., Boone Pickens's BP Capital LLC and Loeb's Third Point
purchased shares too. Icahn remains locked in a proxy fight with the
company.

Icahn hasn't publicly disclosed his costs for buying Biogen or Yahoo.
Biogen shares have climbed to $58. He bought them in the second
quarter, when they closed as low as $43.68. His campaign to take
control of the drugmaker collapsed last month when he failed to win
enough shareholder votes.

Icahn said in a Bloomberg Television interview on June 5 that his
Yahoo investment was profitable. Since then, the shares have dropped
20 percent. The shares gained 3.4 percent yesterday on optimism that
Microsoft may revive attempts to take over the Internet company.

To contact the reporter on this story: Katherine Burton in New York
at kburton@...

Last Updated: July 3, 2008 00:01 EDT

Viking's Bet
By Chidem Kurdas   |   July 1st, 2008
http://www.hedgeworld.com/blog/?p=105

The steep slide in financial stocks was on the whole lucrative for
short sellers. Many hedge funds continue to bet against financials.
But some big funds are playing the contrarian in this tough market,
among them Andreas Halvorsen's $9 billion Viking Global Investors LP.

  Viking appears to favor asset managers. It bought into a fellow
hedge fund, the publicly traded Och-Ziff Capital Management. It held
State Street and owns more than 5% of Invesco Ltd.

  At first glance, Invesco looks battered. Net income was down the
first quarter. But Viking's analysts are known for insight into
company fundamentals—presumably, that's how they made 40% plus last
year. They must see something really good in Invesco.

  Invesco has made interesting acquisitions, among them private equity
and hedge fund business WL Ross & Co. The company is preparing for an
initial public offering of real estate investment trust Invesco
Agency Securities. Assets under management declined from 2008 but the
trend has been upward in recent months.

Financials are one of Viking's specialties. It's going to be
interesting to watch what happens to the contrarian long trades.

Zelman,

I know  a couple that are in the business of seeding.
But they wont be interested in a guarantee note..
If you want, you can email me some info on your fund and I would be
happy to pass it to them.

Regards,

Hani
aljazzaf@...

--- In hedgefunds123@yahoogroups.com, "zyakubov01" <zyakubov@...>
wrote:
>
> Hi my name is Zelman and noticed that your fund is doing real well i
> have a hedge fund that been running for 4 years now and has been
> profitable every year. The fund also provides a 90% guranteed backed
> note from a huge Bank in Canada. If $10 Million investment is
> something you seek to invest on a very conservative Hedge Fund
please
> let me know. This fund averages aprox. 17% annually with a 1 1/2%
> monthly risk.
>
> Best Regards,
>
> Zelman Yakubov
> 516-229-2727
> 718-926-0892
> zyakubov@...
>
>
>
> --- In hedgefunds123@yahoogroups.com, aljazzaf <no_reply@> wrote:
> >
> > LatAm Hedge Fund Assets Balloon
> > Jul-01-2008 | Source: LatinFinance.com
> >
> > Total estimated assets in hedge funds focusing on LatAm rose
sharply
> > in Q1 2008 and have increased significantly since the end of
2006,
> > according to HedgeFund.Net. "At the end of Q1 2008 total assets
in
> > LatAm focused funds reached an estimated $21.28 billion. This was
an
> > increase of $4.9 billion in the quarter and was mainly in the
form of
> > new allocations to the region," says HFN.
> >
> >
> > This represented an almost 30% rise in assets during the quarter,
the
> > fund tracker adds. Since HFN started covering LatAm in February
2007,
> > its benchmark average index has increased 28.02%, outperforming
every
> > strategy-specific HFN benchmark except the HFN Mortgages Average
and
> > most regional or country specific benchmarks.
> >
> >
> > Only the HFN Brazil, Middle East/North Africa and China averages
have
> > outperformed the broad LatAm hedge fund index, says HFN. The
majority
> > of funds focusing on LatAm manage fewer than $500 million in
assets
> > and smaller fund size has not necessarily translated to better
> > performance.
> >
> >
> > "In the last 12 months, the smallest funds, those with less than
$20
> > million in AUM, have produced the lowest returns at each
percentile
> > point outside of the top 10th percentile," says HFN. LatAm hedge
> > funds returned 4.07% in May, much more than the 1.88% global
average.
> > They have made 4.63% in the year to date, versus 0.67% for funds
on
> > average globally.
> >
>

Hi my name is Zelman and noticed that your fund is doing real well i
have a hedge fund that been running for 4 years now and has been
profitable every year. The fund also provides a 90% guranteed backed
note from a huge Bank in Canada. If $10 Million investment is
something you seek to invest on a very conservative Hedge Fund please
let me know. This fund averages aprox. 17% annually with a 1 1/2%
monthly risk.

Best Regards,

Zelman Yakubov
516-229-2727
718-926-0892
zyakubov@...



--- In hedgefunds123@yahoogroups.com, aljazzaf <no_reply@...> wrote:
>
> LatAm Hedge Fund Assets Balloon
> Jul-01-2008 | Source: LatinFinance.com
>
> Total estimated assets in hedge funds focusing on LatAm rose sharply
> in Q1 2008 and have increased significantly since the end of 2006,
> according to HedgeFund.Net. "At the end of Q1 2008 total assets in
> LatAm focused funds reached an estimated $21.28 billion. This was an
> increase of $4.9 billion in the quarter and was mainly in the form of
> new allocations to the region," says HFN.
>
>
> This represented an almost 30% rise in assets during the quarter, the
> fund tracker adds. Since HFN started covering LatAm in February 2007,
> its benchmark average index has increased 28.02%, outperforming every
> strategy-specific HFN benchmark except the HFN Mortgages Average and
> most regional or country specific benchmarks.
>
>
> Only the HFN Brazil, Middle East/North Africa and China averages have
> outperformed the broad LatAm hedge fund index, says HFN. The majority
> of funds focusing on LatAm manage fewer than $500 million in assets
> and smaller fund size has not necessarily translated to better
> performance.
>
>
> "In the last 12 months, the smallest funds, those with less than $20
> million in AUM, have produced the lowest returns at each percentile
> point outside of the top 10th percentile," says HFN. LatAm hedge
> funds returned 4.07% in May, much more than the 1.88% global average.
> They have made 4.63% in the year to date, versus 0.67% for funds on
> average globally.
>

LatAm Hedge Fund Assets Balloon
Jul-01-2008 | Source: LatinFinance.com

Total estimated assets in hedge funds focusing on LatAm rose sharply
in Q1 2008 and have increased significantly since the end of 2006,
according to HedgeFund.Net. "At the end of Q1 2008 total assets in
LatAm focused funds reached an estimated $21.28 billion. This was an
increase of $4.9 billion in the quarter and was mainly in the form of
new allocations to the region," says HFN.


This represented an almost 30% rise in assets during the quarter, the
fund tracker adds. Since HFN started covering LatAm in February 2007,
its benchmark average index has increased 28.02%, outperforming every
strategy-specific HFN benchmark except the HFN Mortgages Average and
most regional or country specific benchmarks.


Only the HFN Brazil, Middle East/North Africa and China averages have
outperformed the broad LatAm hedge fund index, says HFN. The majority
of funds focusing on LatAm manage fewer than $500 million in assets
and smaller fund size has not necessarily translated to better
performance.


"In the last 12 months, the smallest funds, those with less than $20
million in AUM, have produced the lowest returns at each percentile
point outside of the top 10th percentile," says HFN. LatAm hedge
funds returned 4.07% in May, much more than the 1.88% global average.
They have made 4.63% in the year to date, versus 0.67% for funds on
average globally.

Wesley Capital Management Moves Beyond Backup Tape
Wesley Capital Management brings business continuity online by
outsourcing disaster recovery to specialty IT provider Eze Castle
Integration.
By Anne Rawland Gabriel
June 30, 2008

http://www.financetech.com/featured/showArticle.jhtml?
articleID=208801742


Regardless of a hedge fund's size or type, none can afford to be off
line. "Investors increasingly want even the smallest funds to
demonstrate they're minimizing operational risks," emphasizes Sang
Lee, managing partner at Aite Group. "Events such as Katrina, the
Tokyo stock market outage in 2006 and last year's steam pipe rupture
in midtown Manhattan have all converged to make business continuity a
priority."

Further, reliance on backup tape for disaster recovery (DR) isn't
enough anymore. "A tape is nearly useless without the proper server
to put it on or if you can't get into your building," Lee points
out. "Even with appropriate hardware, it takes hours or days to
restore from tape. So investors now view tape as only part of a DR
strategy."

Of course, tape's limitations isn't the whole issue, notes Lee. "More
often than not, the person charged with [disaster recovery] at a
hedge fund has a completely different primary role," he
says. "Typically, such individuals lack the time or expertise to
develop and manage a complex DR system."

Naturally, enterprise IT providers have long offered solutions -- for
a price. "But smaller hedge funds may view enterprise players as
overkill," Lee says.

Fortunately, other players now are filling the gap. "Mid-level IT
firms with hedge fund expertise are adding DR to their offerings,"
Lee explains. "This includes redundant hot site facilities where an
exact copy of a fund's IT infrastructure is hosted."

Small Fish in a Big Pond?

Hiring your networking firm to double as your DR provider can offer
efficiencies, Lee adds. "If an IT shop has set up your network, they
know what hardware you're using, how it's configured, what the
connectivity issues are, which software applications are deployed,
etc. Then the question becomes: Do you want to be a small fish in a
big pond or a big fish in a small one?"

The circuitous DR journey taken by New York-based Wesley Capital
Management (WCM) is a case in point. Having attracted some large
institutional and international investors in 2005, WCM, which has
$1.6 billion in assets under management, was preparing to scale up
and move from shared space to its own facility. For technology
infrastructure, the fund sought a reputable 24/7 provider. With the
help of its prime broker, WCM selected an enterprise-class IT firm.

By early 2006 WCM had completed the relocation and hired Jennifer
Webster, a controller with on-the-job IT experience. "Unfortunately,
it became apparent that our IT provider wasn't a good fit," says
Webster. "Our network was unstable and the techs couldn't seem to fix
even the simple things that I could fix. And the support department
was a revolving door, so I was always hand-holding a new tech."

Not surprisingly, DR was put on the back burner. "Although an
institutional investor had required us to develop continuity systems,
stabilizing our production network came first," Webster
recalls. "After six months of headaches, I began looking for an IT
firm that would be a partner and not just throw product at us. But I
also wanted a provider large enough to be available when we needed
them at midnight."

Wittenham launches hedge fund for frontier markets

SINGAPORE, July 1 - Singapore's Wittenham Investment Management
launched a fund of hedge funds to invest in frontier capital markets
such as Africa, Middle East and countries in the former Soviet Union.

The MENA Plus fund would start with a minimum $7 million seed capital
and has a capacity to take as much as $300 million of funds from
investors, said Peter Douglas, an adviser to the fund and founder of
hedge fund consultancy GFIA.

"In the emerging Europe, Middle East, and African time zone, we've
found plenty of experienced managers creating very attractive risk-
return profiles," he said in a statement.

High prices of oil and commodities have boosted economic growth and
wealth in the Middle East and in Africa, encouraging fund managers
such as Franklin Templeton and Pictet to invest in these so-called
frontier markets.

Last year MSCI Barra, a unit of Morgan Stanley <MS.N>, launched the
MSCI Frontier Markets Indices <0#.MIFM> covering 19 countries in
central and eastern Europe, Asia and Africa.


http://www.wittenhamfunds.com/

Hi my name is Zelman Yakubov and I work with several Hedge Fund
Managers world wide I provide Prime Services and Research for the
following Goldman Sachs, Jeffries & Penson. We also work with
sophisticated investors that seek to invest in profitable Hedge Funds.

If anyone would like more information please email me or call me my
information is enclosed below:


Thank You,

Zelman Yakubov
VP Institutional Sales
Grossman & Co.
Tel: 516-229-2727
Mobile: 718-926-0892
Email: zyakubov@...

Asian Fund Industry
KEN HEINZ, HFR
Issue 38, June 2008

http://www.thehedgefundjournal.com/research/index.php?
articleid=77465986


Assets invested in hedge funds focusing on Asia declined by
approximately 10% in the first quarter of 2008, representing only the
latest chapter in the development of the Asian hedge fund industry.
As is frequently true with regard to both investing in hedge funds
and investing in Asia, the details become more interesting as they
become more clearly understood. Assets invested in Asian hedge funds
fell from over US$111 billion at the end of 2007 to just over US$100
billion, which, combined with the negative performance and ceteris
paribus (all else being equal), is likely to have constituted a
market development eliciting collective investor capital withdrawals.
Yet investors actually allocated an additional US$1 billion to Asian
hedge funds, only partially offsetting the negative performance
impact in total hedge fund assets in Asia.

The growth and concentration of capital, as well as the combined and
intertwined influences of both emerging and developed economics in
such close geographic proximity, are only two of the factors which
suggest the potential for substantial growth in the Asian hedge fund
industry. As a testament to the divergences of economics between
developed and emerging and their implications, it is relatively well
known (but bears restatement for context) that since the very early
days of hedge fund industry development (1990) through to the
present, an investor in the Nikkei 225 would have lost over 5%
annualised. It is also well known that an investor in Emerging Asia
(results vary by specific index) generally would have at least
doubled their investment in the last few years, in some cases,
returning greater than 100% in a single calendar year. Clearly the
divergences in performance and across the regions and time periods
represent an opportunity for long and short investing, ceteris
paribus.

Industry estimates of the Asian hedge fund industry are based on the
strategic focus of each fund and not on the geographic exclusivity,
firm location or legal domicile of the hedge fund structure. It is
interesting to note that more than half of the funds which comprise
the Asian hedge fund industry are themselves located in Asia, with
the balance being located in the US and UK. Progressive structural
characteristics have contributed to the development of the industry
located in Hong Kong, Singapore and Australia over the past few
years, with fewer funds currently located in China or Japan. A recent
softening in attitudes towards hedge funds has also been seen from
countries such as South Korea.

Indicative of the early stage of development of the Asian hedge fund
industry, the industry is significantly less concentrated than the
broader hedge fund industry, with slightly less than 1/3 of Asian
hedge funds with assets of more than US$1 billion under management,
while the overall industry has greater than 70% of assets in funds in
excess of US$1 billion in size. On a broader scale, while the Asian
region represents over 20% of global assets, the region represents
nearly 21% of global bank assets (Milken Institute) but the Asian
hedge fund industry represents only approximately 5% of the capital
invested in hedge funds. Smaller still and with greater potential,
the overall industry represents approximately 1% of global financial
capital, while capital invested in Asian hedge funds represents only
0.25% of total Asian financial capital. Ceteris paribus, the scope of
opportunities is significant on a global scale.

The Asian hedge fund industry is composed of nearly 2/3 equity hedge
strategies, a stark contrast to the broader industry (1/3 equity
hedge) in a period where equities lost over 20% across Asia. Viewed
within this context, the broad relative overweight that the Asian
hedge fund industry has toward equity hedge, at an aggregate level,
accentuated losses for the industry. Similarly, the Asian hedge fund
industry has approximately half of the exposure of the broader
industry to macro strategies. Over a trailing 6 months period (ending
Q1 08) during which both global and Asian equity markets fell
precipitously, macro funds gained nearly 11%. Macro gains offset
losses across the total industry through short US dollar, long
commodity and long government fixed income, while remaining
relatively neutral, in an aggregate sense, to broader credit and
equity market weakness. The Asian hedge fund industry received a much
smaller benefit of this trend in macro performance, further
accentuating the performance volatility.

Prior to the weakness of Q1 08, investors in Emerging Asia over the
last three years may have become complacent with gains ranging from
steady to strong and with only few, isolated and temporary instances
of weakness, none of which were protracted. With the recent
volatility serving to recalibrate some of these assumptions, two
qualities exhibit compelling characteristics from an investor's
perspective, which are likely to serve as a catalyst for the
continued development for the Asian hedge fund industry, ceteris
paribus. First, the ability to invest long and short provides the
opportunity to reduce individual portfolio volatility and minimise
correlation with other asset classes and markets. Secondly, the
inverse relationship exhibited between macro strategies and volatile
equity markets also presents a noteworthy portfolio dynamic. As the
expected volatility pattern for Asian investors shifts from being one
of primarily positive volatility to a more normally and evenly
distributed pattern of positive and negative observations, Asian
investors are likely to view the ability to invest long and short
across diverse strategies as a compelling diversification tool

London Calling: 39 of 50 Single-Manager Hedge Fund Firms in Alpha
Magazine's Ranking of the Biggest Firms in Europe Call the U.K. Home
Thursday June 26, 5:05 pm ET


European Hedge Funds Rise in Global Standing


NEW YORK, NY--(MARKET WIRE)--Jun 26, 2008 -- Most of the hedge fund
noise out of Europe these days is coming from the U.K., where funds
are increasingly keeping pace with their U.S. cousins. A whopping 39
of the 50 single-manager firms in Alpha magazine's 2008 Europe Hedge
Fund 50 ranking, including seven of the world's top 25 hedge fund
firms, are headquartered in London.




The 50 firms on Alpha's new list control a total of $405.3 billion in
assets, or 20 percent of a global $1.8 trillion industry. In 2004,
the first year the list was compiled, the entire European hedge fund
industry had less than $190 billion in assets.

Four of the top 50 European firms are in Paris, followed by single
firms in Bilboa, Cyprus, Geneva, Moscow, Zurich and on the British
isle of Guernsey.

"When we started investing in hedge funds 12 years ago, it was a
challenge to find any really good managers outside the U.S.," says
Ibrahim Gharghour, co-head of hedge funds for Investcorp. "London has
matured in terms of quality of managers, their infrastructure, the
depth of market and standard of people. And now U.S. funds, as they
grow, must also have a presence here."





2008 Rank              Firm                   Firm Capital ($
millions)
1            Barclays Global Investors        $26,227
2            GLG Partners                     $23,900
3            Brevan Howard Asset Mgmt         $21,000
4            Man Investments                  $20,900
5            Lansdowne Partners               $18,903
6            BlueBay Asset Mgmt               $16,400
7            Sloane Robinson                  $15,100
8            Marshall Wace                    $15,019
9            HSBC                             $13,579
10           The Children's Investment
              Fund Mgmt U.K.                   $13,000

The complete ranking is available online at www.alphamagazine.com.
The list also appears in the June 2008 issue of Alpha magazine.



Contact:
      Contact Information:
      Chris Cavanagh
      212-224-3369
      chriscavanagh@...



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Source: Alpha Magazine