PrimeBrokerage.net » Industry News

Ex-Goldman Prop. Trader’s Hedge Fund Picks Three Prime Brokers

admin — Tue, 01 Mar 2011 10:18:52 +0000

Azentus Capital, expected to be among the largest hedge fund launches of the year, has recruited a trio of brand-name prime brokers to handle its trades.

The Hong Kong-based hedge fund, founded by former Goldman Sachs proprietary-trading chief Morgan Sze, will use the services of his old firm, as well as those of Morgan Stanley and UBS, Reuters reports. The new fund is expected to debut in the second quarter with more than US$1 billion in initial assets.

Sze, who has been planning the fund since last year after Goldman decided to pull the plug on its prop. trading operations, officially left the firm earlier this month and registered Azentus with Hong Kong regulators a week ago. He is thought to be building a team of about 30 for the firm, including Roger Denby-Jones, former Boyer Allan Investment Management CEO, as chief operating officer, and at least four former members of his team at Goldman.

Source

New Asian Funds Attract Almost $4B In 2010

admin — Fri, 25 Feb 2011 09:34:47 +0000

Asian fund launches were up 48% year on year in 2010, with 95 new funds attracting $3.84 billion in assets, according to the latest AsiaHedge New Funds Survey.

In 2009, 78 Asian funds were launched with a total of $2.6 billion.

“Despite a slightly lackluster second half, new Asian hedge fund launches continued to see a sustained interest, though rising barriers to entry meant that most of the capital went to either second-generation managers with a strong pedigree or new offerings from established hedge fund shops,” says Aradhna Dayal, editor of AsiaHedge in Hong Kong.

“Anecdotal evidence suggests that U.S. allocators were probably the largest contributors to the start-up capital last year, though a new breed of Asian high net worth individuals and family offices also emerged as silent but serious backers of several new hedge funds.”

Singapore performed well in 2010, reporting the launch of 15 new funds with $673 million, up significantly from 2009. “The new regulatory regime being rolled out there has brought about a renewed confidence in the Lion City funds, and that is being reflected in the start-up space too,” says Dayal. Hong Kong remained the leader in the region, though, with 57 launches that attracted $2.4 billion in assets.

Redistribution of assets, resulting from the outflows from closures to new managers, as well portfolio rebalancing by investors within Asia, contributed significantly to the total new launch asset raising.

In terms of strategy, new China funds led the pack, as they did in 2009, attracted $817 million or 21% of total assets gathered by new funds. Multi-strategy funds, with $365 million; Japan-focused funds, with $317 million; and macro funds, with $208 million, also attracted considerable interest.

Dayal says 2011 holds promise, with several high-profile bank spin-offs and second-generation hedge fund launches in the offing. “Just like the class of 2009, the class of 2011 will be an interesting one to watch, with star prop traders such as Morgan Sze, Ben Fuchs and Charlie Chan expected to make their debuts,” she says.

Source

PIMCo Nabs Ex-Citadel I-Bank Research Chief

admin — Thu, 24 Feb 2011 10:47:57 +0000

Mutual fund giant Pacific Investment Management Co. has hired a former executive of Citadel Investment Group’s investment banking unit to lead its analytics effort.

Ravi Mattu will start as a managing director at the California firm next month, PIMCo said, reporting directly to CEO Mohamed El-Erian. Most recently, Mattu was head of research and strategy at Citadel Securities, leaving in July. Mattu is just one of a long series of high-level executives to leave the group in recent years.

“Ravi’s mandate is to expand our state-of-the-art analytics solutions for PIMCO’s clients,” El-Erian and Bill Gross, the firm’s co-chief investment officers, said. “Having a word-class integrated analytics framework has been key to PIMCo’s success, and remains so.”

Mattu, who will be based at PIMCo’s Newport Beach headquarters, takes over for William de Leon, global head of portfolio risk management, who currently leads the analytics group on an interim basis.

Source

Dynegy CEO, CFO Quit After Icahn Deal Fails

admin — Wed, 23 Feb 2011 10:48:49 +0000

In the wake of their failed deal to be acquired by hedge fund Icahn Enterprises, the top managers of energy company Dynegy have resigned.

Bruce Williamson, the company’s chairman and CEO, and Holli Nichols, its CFO, will resign on March 11, they said yesterday. The departures follow the resounding rejection of Icahn’s $665 million bid for Dynegy, which attracted the support of less than 5% of shares outstanding.

Icahn’s bid for Dynegy has expired, although the hedge fund could have continued extending it until September. The firm, which had previously helped short-circuit a deal for Dynegy by the Blackstone Group alongside hedge fund Seneca Capital, found its own bid sunk by Seneca’s strenuous opposition.

Dynegy said a further shakeup is likely, with some members of its board likely to leave at its annual meeting.

“While all current directors intend to remain fully engaged in their duties through the 2011 Dynegy annual meeting, we expect the new members of the board to take the lead in defining the future composition of the board and in selecting a new chief executive officer,” newly-named interim Chairman Patricia Hammick said.

Source

No New Money For SEC, CFTC In Temporary Budget Deal

CalPERS Real Estate Portfolio Manager Quits

admin — Tue, 22 Feb 2011 10:40:32 +0000

CalPERS has lost its third portfolio manager in a month—the fund’s senior real estate portfolio manager, James G. Lasher, has resigned.

Lasher’s resignation follows those of two senior portfolio managers in the California Public Employees’ Retirement System’s $47.5 billion alternative investment program—Joncarlo Mark and Michael Dutton.

Clark McKinley, spokesman for the $226.5 billion system, confirmed the latest departure for Pensions&Investments and said it was effective Friday.

Lasher had been with CalPERS for two years and managed investments in 20 residential investment funds.

McKinley told P&I the housing portfolio will play a less important role as the California retirement system winds down non-core investments as part of its new real estate strategy.

P&I quotes unidentified sources as saying Lasher was upset by the growing influence of consultants over the direction of CalPERS’ real estate portfolio.

Source

Five Shumway Vets To Launch Own Funds

admin — Fri, 18 Feb 2011 07:25:36 +0000

Shumway Capital Partners founder Chris Shumway said he expected new businesses to rise from the ashes of his shuttered $8 billion fund, and he was right.

Hedge Fund Alert reports today that five portfolio managers will leave Shumway Capital to start their own funds. They are: Neil Shah, who specializes in healthcare stocks; Ashwin Vasan, a macro manager; Chris Lange, a consumer-stock specialist; Jeff Nykun, who specializes business services companies; and Shumway Capital CIO Tom Wilcox.

Wilcox, who is credited with the call to short financial stocks that made a killing for the fund in 2008, had been Shumway’s heir apparent. But after the announcement that he would be taking over the reins from the founder triggered billions in redemptions, Shumway was forced into damage control mode, promising major investors he’d postpone the handover for three months. Then, abruptly, on February 4th, he announced he would return all investor capital.

Shumway launched Shumway Capital in 2002, after a successful career at Julian Robertson’s Tiger Management. Starting with five employees and $70 million in capital, Shumway grew the firm to $8 billion and 95 employees. Over its eight-year run, the fund provided average annual returns of 17%.

Source

Insparo Unveils Africa-Focused Hedge Fund

admin — Mon, 14 Feb 2011 13:30:17 +0000

U.K.-based Insparo Asset Management has launched a new Africa-focused hedge fund that aims to capitalize on the huge growth potential of African businesses and the rise of the continent’s consumer culture.
The Insparo Africa Equity Fund will invest in market leading companies aimed at the consumer space across North Africa and Sub-Saharan Africa. The strategy will also make investments in South African equities, although listed companies will be limited to 20% of the portfolio.

Fifty percent of the 25 fastest growing economies in the next five years are African, and foreign direct investment into the continent has swelled enormously. China announced recently that its bilateral trade with Africa had increased by nearly 45% in a year to reach a record $115 billion.

“The rise in consumption in Africa in the last decade has been remarkable, but there is still a huge amount of room for growth,” said Jamie Allsopp, who leads Insparo’s investment team. “The penetration of goods and services in Africa is still relatively low, and African consumers are projected to spend $1.8 trillion in 2020, an astonishing increase of over a trillion dollars from 2008. The aim of this fund is to invest in sustainable companies that will benefit from and aid this positive tailwind.

The new fund launched with initial seed capital of $7.5 million, raised through internal and external investors, and will be soft closed at $250 million.

The new vehicle is Insparo’s second fund. The firm’s flagship multi-strategy Africa and Middle East fund has returned 36% since launch in June 2008, placing it among the best performing funds in its sector. The firm expects the new the Africa Equity Fund to make average unlevered annual returns of 15-20%.

Source

Phibro Hedge Fund Goes From 12% Loss To 12% Gain In Four Months

admin — Thu, 10 Feb 2011 13:02:08 +0000

John Paulson isn’t the only well-remunerated hedge fund manager to manage a major turnaround late last year.

Astenbeck Capital Management, the firm run by former star Citigroup energy trader Andrew Hall, also swung from a double-digit loss to a double-digit gain as the year drew to a close. Westport, Conn.-based Astenbeck’s flagship was down 12% through the end of August—but was up 12% by the time the ball dropped in Times Square, Reuters reports. The fund returned 9% in September and then again in December to both begin and complete the turnaround.

The $1.7 billion fund relied on metals and agricultural commodities, as oil and natural gas bets took their toll.

“The persistent contango in the oil markets throughout most of 2010 meant that returns from oil were not as good as those from some other commodities,” Hall wrote.

Hall founded Astenbeck in 2008, just before Occidental Petroleum bought Hall’s Phibro trading desk from Citi in 2009. Citi moved to sell the highly-profitable desk, which now manages money exclusively for Occidental, because it feared the ire of federal regulators over Hall’s guaranteed $100 million bonus.

Astenbeck, which has been closed to new investors, was set to begin accepting new money again last month.

Source

Asian Hedge Funds Attract $500M In 4Q 2010

ericbank — Tue, 08 Feb 2011 11:01:48 +0000

Investors poured $500 million in net new capital into Asian hedge funds in 4Q 2010, according to a new report from Hedge Fund Research. The hedge fund research firm says investors favored strategies protecting against inflation.

HFR, a leading provider of hedge fund industry data, says that including performance gains, assets invested in Asia-focused hedge funds increased by $4.4 billion in the fourth quarter of last year to $83.4 billion—the biggest hike since 3Q 2009.

For all 2010, assets invested in Asian-focused funds grew $6.6 billion, the largest calendar year increase since 2007.

In 4Q10, the HFRX Japan Index climbed 5.87%, leading other Asian regions on both a nominal and relative performance basis. For the full year 2010, funds focused on investing in inflation-sensitive India posted the strongest gains, with the HFRX India Index gaining 15.47%. The HFRX China Index gained 9.37% for 2010, trailing other Asian and emerging markets for the full year, but preserving capital from the declines and volatility that characterized broader Chinese equity markets.

Investors favored funds which have characteristically provided inflation protection and exposure to the developing market for cross-border corporate transactions globally. In 4Q, 35% of new investor inflows went to funds focused on Asian equity markets.

Similarly, for the full year, investors allocated $765 million to event-driven Asian hedge funds, which include distressed and activist strategies. A combination of performance losses and redemptions reduced the capital allocated to Asian relative value funds, a counter trend to the rest of the global hedge fund industry. Of the four major strategies tracked by HFR, relative value funds globally experienced the largest capital inflows and produced the highest returns in 2010, furthering highlighting the disconnect between relative value strategies in Asia and the rest of the world.

“Investors continue to allocate to Asian hedge funds but now, more than ever, have indicated a strong and clear requirement for inflation protection in their hedge fund strategies,” said HFR President Kenneth J. Heinz. “To meet this demand, the Asian hedge fund industry has evolved to offer access to not only hedged equity strategies, but sophisticated currency, commodity, volatility, corporate transaction and fixed income exposures designed to appeal to inflation-sensitive investors in 2011.”

Source

RAB Slashes Hong Kong Staff, Cancels Planned Fund

admin — Wed, 19 Jan 2011 09:21:47 +0000

RAB Capital’s recovery apparently does not extend to Asia. The troubled London-based hedge fund, which enjoyed a strong year from two of its funds, has reduced its Hong Kong office—its only international office—to a rump.

The firm bade farewell to four members of the five-person team it hired from D.B. Zwirn & Co. in 2009 in December, Bloomberg News reports. The cuts leave just four employees in Hong Kong, led by RAB Asia CEO David Seex.

But Seex now oversees a region where RAB has no dedicated funds and no plans to launch one. The firm shuttered its last Asia hedge fund, run by its Pi investment team, late last year, and cancelled plans to have the former Zwirn team launch a distressed fund.

“We have taken action to reduce our cost base in Asia,” the firm said. “We’re now focused on expanding our Asian investor base in our core products, several of which delivered very strong returns in 2010.”

RAB is retrenching in Asia as other funds are returning to the region after cutting back during the financial crisis.

Source