Friday, March 27, 2009

Millennium Management growing

In a report from Bloomberg, they report that hedge fund Millennium Management has hired more than 15 people since November. They overlook $11.5 billion in assets. They're continuing to hire and secure top talent while many of the financial firms are facing significant layoffs. Click here to read the article.

Wednesday, March 25, 2009

Cayman Islands Tax Information Assistance is Extended to 7 European Countries

According to this article on Hedge Funds Review, seven more European countries are now able to request tax information from the Cayman Islands under provisions in the Tax Information Authority Law. The countries include Germany, Austria, Belgium, the Czech Republic, Luxembourg, the Slovak Republic and Switzerland. Requests related t o civil, administrative, and criminal tax matters are all welcomed.

Tuesday, March 24, 2009

Now is the time to start a hedge fund

In a recent article published by Reuters, they say that now is the time to start a hedge fund. Due to the fallout of last year, they're now employing dislocation and creative destruction to make hedge funds work. There is also abundant talent available, due to the number of employees leaving companies such as JP Morgan and Goldman. The one challenge, however, is obtaining new investors and money to start the hedge funds.

Do you agree? Is now the time to start creating and investing in hedge funds?

Thursday, March 19, 2009

Closed hedge funds

The New York Times recently wrote an article about those hedge funds that did not make it out of the turmoil of the recent stock market. Last year, 200 hedge funds have shut down, which at one point controlled $84 billion. Some of those included: Fairfield Greenwich, Treemont Group, and Kingate Management; all of which had money invested with Madoff. Drake Management also shut down, but had no funds invested in that scheme. For more, read the article here.

Monday, March 16, 2009

Hedge funds are still a good place to grow money

In a recent article at Risk without Reward, they look at three reasons why hedge funds are still a great place for investors to put their money. They focus on the fact that hedge fund managers should be paid for their performance, and shouldn't be allowed to change the rules midway through the process. They also focused on three key points:

1) Gating while charging fees is unacceptable
2) Pay for performance works
3) Don't tinker with high water marks

Wednesday, March 11, 2009

Fund of funds shifting to due diligance and diversifying

In an article at The Business Insider, they point out that assets under the management of fund of funds have shrunk only 30%. The Madoff scandal has had its impact in this industry, as many funds of funds poured money into Madoff scheme, often without making that particular investment "strategy" perfectly clear to investors. Alternative investment strategies have also shifted, as many international investors have begun to rebalance their portfolios. For the full story, click here.

Monday, March 9, 2009

Hedge funds alert to hammer falls

According to's Pauline Skypala, there is concern in hedge fund quarters that much of the rhetoric puts that industry squarely in the frame for blame, and for reform. In his speech to the US Congress last week, UK prime minister Gordon Brown was perceived to be dissing hedge funds as much as investment banks when he said: “How much safer would everybody’s savings be if the whole world finally came together to outlaw shadow banking systems and offshore tax havens.” Read the rest of her article, here.

Friday, March 6, 2009

IMF calls for coordination across countries

In a recent article at Financial Times, they state that the IMF warned banks that they should have a binding international code of conduct to influence behavior of banks when financial crises stretch across borders. They also took the blame for failing to provide leadership.

In a major study of the lessons learned from the financial crisis, the IMF also accepted blame for missing the dangers arising from weakly regulated financial institutions and admitted it had failed to provide global leadership.

But the fund argued that global economic imbalances, notably the huge current account deficit in the US and corresponding surplus in China, had played only a secondary role in creating the crisis.

Thursday, March 5, 2009

Caveat Emptor - The Elusive Definition of Hedge Fund Due Diligence

GAIM Cayman speaker, Jason Scharfman, Corgentum Consulting, LLC writes in a recent article
concerning the term due diligence and its frequent use within hedge fund vernacular. Scharfman writes, yet the exact definition in practice seems quite elusive. One need only examine a cross section of due diligence providers to see that a wide range of services are classified, sometimes misleadingly so, by this term. So what exactly are investors buying when they purchase hedge fund due diligence services?
  • Is it background investigation work?
  • How about compliance reviews?
  • What about investment strategy reviews?
  • Is it a review of operational risks?
For a full overview of his thoughts, visit his original article here.

Tuesday, March 3, 2009

Hedge fund investors want changes

In a recent article at The Australian, they look at the current problem hedge fund managers are facing. Investor boards, such as university endowments and foundation trusts, are demanding that there should be a change in the way hedge funds are operated. However, hedge fund managers are likely to agree to little changes, but not major movements, as they see themselves as major assets to the industry. Investors would like clearer rules on redemption rules and lower fees among other changes.