The Hedge Fund Blog Man

Number of New Hedge Fund Launches Rises

2009-10-14T12:08:00.000-07:00

After a slow year, the pace of new hedge fund launches is beginning to take off.

"It's a promising environment for new hedge funds," said Alex Ehrlich, the global head of Morgan Stanley's prime services business. "Money is coming in from seasoned investors, many of whom are preparing to redeploy capital."

In 2008, more than twice as many hedge funds liquidated as opened.

Here is a list of some new hedge fund launches in 2009/2010 (also includes established companies launching new funds):
Beacon Light Capital
RoundKeep Capital Advisors
Roc Capital Management
Ambit Capital
QuantZ Capital Management
Theory Capital Management
Flintlock Capital Asset Management
Black River Asset Managment
Van Hulzen Asset Management
Raffi Capital Management
SLP Capital
Esplanade Capital
Sugarloaf Rock Capital
Tidewater Capital
Harrier Hawk Management
Raven Rock Capital
Mudrick Capital

Hedge Fund Jobs Poised to Recover

2009-10-14T12:03:00.000-07:00

Hedge Fund Jobs Poised to Bounce Back after Rough 2009:
After a slow summer, hedge fund jobs are poised to bounce back. This is according to the 2009 Hedge Fund Employment Report.

The report also details a number of other interesting facts about hedge fund jobs:

Unsurprisingly, New York, Connecticut, and Massachusetts are the best states for getting hedge fund jobs.
Greenwich, Boston, San Francisco, and New York are the best cities for getting hedge fund jobs.
2010 should have improved conditions for getting a hedge fund relative to 2009.

Very informative. You can read the full report here.

Corzine and TPG-Axon - Casino Connection?

2009-09-21T13:15:00.000-07:00

New Jersey Governor Jon Corzine's investment in hedge fund TPG-Axon is accused of being a conflict of interest. The charges relate to TPG-Axon's parent, multi billion dollar private equity firm, Texas Pacific Group.

There is plenty of information available on the web with regard to the actual allegations, but since little useful information is provided we will provide a little background.

Texas Pacific Group

Contact Info (Primary):

301 Commerce Street, Suite 3300

Fort Worth, TX 76102
(817) 871-4000 phone

(817) 871-4010 fax

www.tpg.com

Firm Type: Private Equity

AUM: $45 billion

Key People:

• Founding Partner: David Bonderman

• Founding Partner: James G. (Jim) Coulter

• Partner, Operations: Richard W. (Dick) Boyce

Principal Competitors: Kohlberg Kravis Roberts & Co.; Hicks, Muse, Tate & Furst Incorporated; Clayton, Dubilier & Rice, Inc.

Other Info: TPG is headquartered in Fort Worth, TX and San Francisco, CA. The firm also has offices in 8 countries. Texas Pacific Group's largest private equity fund is TPG Partners VI, an almost $20 billion global buyout fund launched in 2008.

TPG-Axon Capital Management

Contact Info:

888 Seventh Avenue, Floor 38
New York, NY 10106-3899
(212) 479-2000 phone

Firm Type: Hedge Fund

Founded: 2005

2009 AUM: $10.7 billion

Key People:

Dinakar Singh - Founder and CEO
31 Employees

Other Info: TPG-Axon is a global macro hedge funds ranks as the 25th largest US hedge fund by assets under managerment as of August 2009.

Largest Holdings (as of June 30, 2009):

Hewlett Packard - $429 million

Pepsico - $312 million

Oracle - $304 million

Microsoft - $278 million

JP Morgan - $277 million

2001 Interview with Madoff Betrayed Fraud

2009-09-17T16:05:00.000-07:00

Suspicious 2001 Interview with Madoff
We have often heard that there were a good many financial professionals who were suspicious of Madoff's hedge fund, based on the low volatility and almost complete lack of a month with negative returns. However, in an interview Madoff gave in 2001, there were many clues, certainly in retrospect, that something was amiss.

Here are a few quotes from that article by MarHedge in May of 2001 that are certainly interesting in hindsight:

"Those who question the consistency of the returns, though not necessarily the ability to generate the gross and net returns reported, include current and former traders, other money managers, consultants, quantitative analysts and fund-of-funds executives, many of whom are familiar with the so-called splitstrike conversion strategy used to manage the assets."

"What is striking to most observers is not so much the annual returns—which, though consider somewhat high for the strategy, could be attributed to the firm’s market making and trade execution capabilities—but the ability to provide such smooth returns with so little volatility."

"The best known entity using a similar strategy, a publicly traded mutual fund dating from 1978 called Gateway, has experienced far greater volatility and lower returns during the same period."

"And in a face-to-face interview and several telephone interviews, Madoff sounds and appears genuinely amused by the interest and attention aimed at an asset management strategy designed to generate conservative, low risk returns that he notes are nowhere near the top results of well-known fund managers on an absolute return basis."

"The apparent lack of volatility in the performance of the fund, Madoff says, is an illusion based on a review of the monthly and annual returns. On an intraday, intraweek and intramonth basis, he says, 'the volatility is all over the place,' with the fund down by as much as 1%."

"But as whole, the split-strike conversion strategy is designed to work best in bull markets and, Madoff points out, until recently 'we’ve really been in a bull market since ‘82, so this has been a good period to do this kind of stuff.'"

"As for the specifics of how the firm manages risk and limits the market impact of moving so much capital in and out of positions, Madoff responds first by saying, 'I’m not interested in educating the world on our strategy, and I won’t get into the nuances of how we manage risk.'"

"He won’t reveal how much capital is required to be deployed at any given time to maintain the strategy’s return characteristics, but does say that 'the goal is to be 100% invested.”

"Indeed, says Madoff, the firm itself has received numerous buyout offers but has so far refused any entreaties because he and the many members of his immediate and extended family who work there continue to enjoy what they do and the independence it allows and have no desire to work for someone else."

"Similarly, he adds, another firm could duplicate the strategy in an attempt to get similar results, but its returns would likely be unmatched because 'you need the physical plant and a large operation' to do it with equal success. However, many Wall Street firms, he says, do use the strategy in their proprietary trading activities, but they don’t devote more capital to such operations because their return on capital is better used in other operations."

"Madoff, who believes that he deserves 'some credibility as a trader for 40 years,” says: “The strategy is the strategy and the returns are the returns.' He suggests that those who believe there is something more to it and seeking an answer beyond that are wasting their time."

Those are chilling quotes knowing what we do now.

Read the full article here

World's Most Stable Hedge Funds

2009-09-16T17:08:00.000-07:00

Below is a list of the most stable hedge funds in the world. The majority of hedge funds meeting the criteria are fixed income / arbitrage funds. The stability rating is based on 5 year returns, 5 year standard deviation of returns, and worst 3 mo. returns. All funds below had positive cumulative 5 year returns and had returns of no worse than -2% in the fund's worst 3 mo. period. Of course, just because a fund has stable, positive returns, does not necessarily indicate it is a safe investment. Recall that Bernard Madoff Securities posted positive monthly returns for 10 straight years with very low volatility. Had Madoff's fund still been active, it would have rated at or near the top of this list.

Most Stable Hedge Funds:

Fund Name	Firm Name	City	State	Stability Rating	Fund Type
Fletcher Income Arbitrage Fund	Fletcher Asset Management	New York	NY	99.45	Debt Arbitrage
Talisman Partners	Envision Capital Management	Scottsdale	AZ	99.35	Distressed Debt
Coast Enhanced Income Fund II	Coast Asset Management	Santa Monica	CA	99.15	Debt Arbitrage
Equity Income Partners	Envision Capital Management	Scottsdale	AZ	98.91	Debt/Fixed Income
AlphaBridge Fixed Income Fund	AlphaBridge	Greenwich	CT	98.69	Fixed Income
YA Global Investors	Yorkville Advisors	Jersey City	NJ	98.22	Debt Arbitrage
FAMA Sniper	FAMA Investors	Grand Cayman	GT	97.99	Emerging Markets
Kassirer Market Neutral		Toronto	ON	97.8	Convertible Arbitrage
DB Equilibria Japan Fund USD	DB Advisors	New York	NY	97.63	Absolute Return
Glazer Offshore Fund	Glazer Capital Management	New York	NY	97.38	Merger Arbitrage
Blackthorn Fund	Blackthhorn Group	Overland Park	KS	97.2	Multi Strategy
Durban Capital	Durban Capital	New York	NY	97.02	Equity Arbitrage
Loch Capital I	Loch Capital	Boston	MA	96.84	Equity
Tuscan Investments	Tuscan Group	San Francisco	CA	96.63	Equity
Winbeldon Fund	Weston Capital	Westport	CT	96.4	Global Equity
Gabelli Associates	Gabelli	Rye	NY	96.22	Equity
Blue Rock Capital Fund	Blue Rock Advisors	Minneapolis	MN	96.05	Fund of Funds
Culross Arbitrage Fund	Culross Global Management	London	UK	95.83	Fund of Funds
MKP Opportunity Offshore	MKP Capital	New York	NY	95.64	Debt Arbitrage
Haberman Value Fund	Haberman Capital	New York	NY	95.45	Equity
AlphaGen Capella Fund Limited	Gartmore Investment Services	Frankfurt	Germany	95.26	Equity
Mac Sentinel Cdn Managed Yield	Mackenzie Investments	Toronto	ON	95.01	Equity Arbitrage
Dexia Double Alpha	Dexia Asset Management	Paris	France	94.81	Fixed Income
Aktie-Ansvar Graal	AktieAnsvar	Stockholm	Sweden	94.68	Equity
BBVA & Partners Eq Arbitrage		Madrid	Spain	94.5	Equity

The above chart is based on our proprietary formula for hedge fund stability. The formula is based on 5 year returns, 5 year standard deviation of returns, and worst 3 mo. period as well as return/volatility ratio. Stable hedge funds do not necessarily indicate safety of investments. The above figures are subject to error and should not be used for making investment decisions under any circumstances.

The World's Riskiest Hedge Funds

2009-09-16T14:19:00.000-07:00

Below is a list of the riskiest hedge funds for the trailing 5 years. Risk ratings are based on a proprietary volatility formula based on 3yr and 5yr standard deviation of returns, as well as the worst 3 month returns. The list of riskiest/most volatile funds includes US as well as Non-US hedge funds. Commodity/Managed Futures and Trend Following hedge funds compose the majority of the riskiest hedge funds due often to the volatility and high correlation of their underlying investments.

Most High-Risk Hedge Funds:

Fund Name	Firm	City	State	Overal Risk	Fund Type
World Grain & Oilseeds Fund	DEC Capital	Lincoln	NE	99.69	Commodities
CFP IQS Fund	CFP Funds	London	UK	99.38	Multi Strategy
Fletcher Aggressive Fund	Fletcher Asset Management	New York	NY	99.06	Arbitrage
Global Partners	Global Partners LP	Chicago	IL	98.75	Multi Strategy
ICL Managed Account Program	Frontier	Fort Dodge	IA	98.44	Trend
AIS Futures Fund	AIS Group	Wilton	CT	98.13	Leveraged Long/Short
Di Tomasso Equilibrium Fund	Di Tomasso Group	Victoria	BC	97.81	Commodities
Dynamic Power Hedge	Dynamic Funds	Toronto	ON	97.50	Equity
LSGI Technology Venture	LSGI Advisors Inc	Duncanville	TX	97.50	Equity
Gerbino Gold Group	The Gerbino Gold Group	Beverly Hills	CA	96.88	Commodities
Legacy Futures Fund	Hawksbill Capital	Chicago	IL	96.56	Managed Futures/Commodities
Liberty Global Fund LP	Liberty Funds Group	Dallas	TX	96.25	Commodities
RAM Aggressive	RAM Futures	New Canaan	CT	96.25	Commodities
TMS Managed Futures Program	TMS Trade	Houston	TX	95.63	FX
Fort Orange Capital GL Strategic	Fort Orange Capital Management	Albany	NY	95.63	Trend
XT-99 Diversified	Pardo Capital	Kenilworth	IL	95.00	Trend
Permal Media & Technology	Permal Capital	New York	NY	95.00	Equity
Harmony Capital LTD Class A	Harmony Capital	London	UK	94.38	FX
Firebird Fund	Firebird Management	New York	NY	94.06	Emerging Markets
BP Capital Energy Equity	BP Capital	Dallas	TX	93.75	Energy

Overall Risk is determined based on worst 3 mo returns, 3 year standard deviation, and 5 year standard deviation based on funds with 5+ years of available returns. There are many definitions of risk and we have developed this measure simply for informational purposes. High levels of risk does not necessarily indicate a poor investment. Many riskier hedge funds have outperformed their peers in total returns. You should not make any investment decisions based on the above information.

The Future of Hedge Fund Regulation - US

2009-08-12T11:18:00.001-07:00

The Future of Hedge Fund Regulation - US

Summary
Over the last couple of years there has been a lot of political discourse about the need for greater regulation of the financial industry, including hedge funds. Much of the information (and rumors) about possible hedge fund regulation is somewhat contradictory. We will wade through the debate and provide a summary of current proposals for hedge fund regulation in the US and discuss hedge fund regulation in the EU and other countries.

Though it was highly regulated financial institutions that are widely believed to be the cause of the recent financial crisis and subsequent economic malaise, there is talk of regulating hedge funds and private equity firms as well. There have been a huge number of proposals for regulating hedge funds ranging from registration requirements for just the largest to funds, to almost authoritarian regulation for all private money managers. However, the current proposals with the most support appear to be hedge fund registration requirements, without significant additional oversight.

Current Hedge Fund Regulations
Under the existing system hedge funds and private equity firms are far less regulated than mutual funds and other investment vehicles open to the public. Though some hedge funds are registered with the SEC, a couple clauses in the Investment Company Act of 1940 allow must hedge funds to operate without registering with the SEC or any other government agency. Probably fewer than half of all hedge funds are currently registered as investment advisors with the SEC. For funds that are registered, the SEC requires certain filings, but does not provide operational oversight.

The Need for Hedge Fund Regulation
Hedge funds were clearly not the major players in the current financial crisis. However, the $50 billion fraud perpetrated by Bernard Madoff sparked plenty of public outrage and there have been a couple of multi billion dollar hedge fund failures since 2007. Additionally, many politicians still fear another hedge fund collapse ala Long Term Capital Management, the giant hedge fund that collapsed in 1998 and necessitated a Federal Reserve orchestrated bailout.

Treasury Secretary Timothy Geithner voiced his concern in April, "Today, the consequences of (hedge funds') failure is greater. They need to be subject to a higher set of standards.”

Proposals for Regulating Hedge Funds and Recent Developments (2009)
In January 2009, Senators Charles Grassley (R-Iowa) and Carl Levin (D-Mich.) introduced the Hedge Fund Transparency Act of 2009. The Act would affect funds with more than $50 million in assets (“large firms”). All funds in excess of $50 million would be required to register with the SEC and maintain books and records according to SEC requirements. It would also require disclosure of including information regarding the identity (including addresses) of the fund’s “beneficial owners,” the amount of the fund’s assets, the fund’s equity structure, affiliations the fund may have with other financial institutions, the minimum investment commitment required of investors, and the total number of investors. The bill did not get to a vote.

In March of 2009, Larry Summers , Director of the National Economic Council for Barack Obama, said the U.S. wants large hedge funds and private-equity firms to be subjected to "rigorous public scrutiny," compared with the minimal oversight they now face. Before joining the Obama Administration, Summers was a Managing Director with one of the worlds largest hedge funds, D.E. Shaw Group.

Then in late April, President Obama lashed out at hedge funds refusing to accept a government offer for Chrysler debt. "A group of investment firms and hedge funds decided to hold out for the prospect of an unjustified taxpayer-funded bailout," Obama said, "They were hoping that everybody else would make sacrifices, and they would have to make none. Some demanded twice the return that other lenders were getting. I don't stand with them."

In July, the Obama Administration, released TG-214, a fact sheet with the Administration’s proposals for regulating hedge funds. Funds with more than $30 million would be required to register with the SEC. Once registered funds would be subject to:
• Substantial regulatory reporting requirements with respect to the assets, leverage, and off-balance sheet exposure of their advised private funds
• Disclosure requirements to investors, creditors, and counterparties of their advised private funds
• Strong conflict-of-interest and anti-fraud prohibitions
• Robust SEC examination and enforcement authority and recordkeeping requirements
• Requirements to establish a comprehensive compliance program
The main rationale for the above requirements is to “protect the financial system from systemic risk”

The most recent House of Representatives proposal for hedge fund regulation, from Aug 6, 2009, seems to have lost some of the initial enthusiasm and would regulate hedge funds under less-stringent conditions than banks and lenders. According to House Financial Services Chairman, Barney Frank, “How can you regulate a hedge fund like a mortgage? It doesn’t make any sense. It will be a form appropriate to them.” In apparent moment of bipartisanship, both Democrats and Republicans seem to be in agreement that hedge fund and private equity firms should be more lightly regulated than other traditional financial firms. It should also be noted that hedge fund industry groups spent almost $4 million in lobbying in the first half of 2009.

Hedge Fund Regulation in Europe
Europe has been quicker to attempt hedge fund regulation and proposals there have generally been more severe than in the US. Likewise, hedge funds and private equity firms in the EU have been more vocal in their opposition to regulation than their US counterparts. The most contentious issue in EU hedge fund regulation appears to be an attempt to limit or place caps on the amount of leverage funds can employ. Because of the possibility of regulatory arbitrage, look for the EU and US to finalize regulations that are relatively consistent.

When Will We Get New Hedge Fund Regulations?
Though there are ongoing talks, there is currently no bill for hedge fund regulation in Congress that is likely to pass. It is unlikely any new regulation will be finalized until 2010. Because compliance with new rules could be costly and time consuming, it is conceivable that new hedge fund regulations might not be enforceable until 2011.

Secondary Hedge Fund Market Struggles Continue

2009-08-11T09:48:00.000-07:00

The secondary market for hedge fund assets has improved somewhat, but huge discounts to NAV persist.

he average price of secondary hedge fund assets rose for the first time in seven months in April and May 2009. The average discount to NAV fell in half to a still high 10%. After promising signs in April and May, the average discount rose again in June.

“A large proportion of the rise in the average price of sales is due to the trading of funds whose underlying assets are generally liquid and performing well. It is notable that investors now have the confidence to pay a higher price for these assets,” said Elias Tueta, of Hedgebay, the author of the report.

But isn't their something discouraging about discounts of more than 10% for sellers of hedge fund assets considering that many of the underlying funds profit on intraday moves of fractions of a percent? Of course, some discount is rational to account for the illiquidity the buyer takes on.

A secondary market for hedge fund assets would provide hedge fund investors an opportunity to dispose of their interests in a fund to a qualified buyer, without having to meet the actual hedge fund's redemption requirements.

Hedge Fund Atticus Capital to Close Flagship Fund

2009-08-11T09:36:00.000-07:00

Atticus Capital announced today it will return $3 billion to investors from two funds, including its flagship hedge fund, the Atticus Global Fund. The fund has not performed well over the last couple years. The Atticus Global Fund was down 25% in 2008 and 9% in 2009 YTD.

As recently as 2007, Atticus Capital had $3.7 billion in assets under management (AUM).

According to Atticus founder, Timothy Barakett, the move was for personal reasons and not in response to investor redemptions.

The $1.2 billion dollar Atticus European Fund will remain open.

Atticus Capital typically employs a merger arbitrage and risk arbitrage, as well as event driven strategies and was founded in 1995 by Timothy Barakett at the age of 29. Atticus is based in New York with an additional office in London.
Contact info for Atticus Capital:
Atticus Capital
767 5th Avenue
New York, NY 10153
Phone: 212-256-8000

Worst Performing Hedge Fund Strategies 2009 (YTD)

2009-08-06T16:34:00.000-07:00

The worst performing hedge fund sectors for YTD (through June 30, 2009):

#1. Short Biased -5.20%
#2. Market Neutral +4.74%
#3. Europe +5.02%
#4. Merger Arbitrage ++5.33%

Source: Hennessee Group

Note that all hedge fund strategies, with the exception of short biased, outperformed the Dow and S&P500.

Best Performing Hedge Fund Sectors of 2009 (YTD)

2009-08-06T16:24:00.000-07:00

The best performing hedge fund sectors for YTD (through June 30, 2009):

#1. Latin America (LATAM) +26.05%
#2. Convertible Arbitrage +21.48%
#3. Distressed +17.16%
#4. Multiple Arbitrage +16.20%

Source: Hennessee Group

Interestingly, only the top 3 hedge fund strategies above even beat the NASDAQ's 16.36% return YTD.

Overall, the index is up 11.74% through the first half of the year, beating all the major US equity indeces, except for the NASDAQ.

50 Largest US Hedge Funds (AUM)

2009-08-06T13:03:00.000-07:00

Below is a list of the Top 50 US Hedge Funds including location, strategy and AUM, ranked by Assets Under Management for 2009:

TOP 50 US HEDGE FUNDS

1. Bridgewater Associates
Location: Westport, CT
Strategy: Multi Strategy, Global Macro
AUM: $38.00 billion

2. JPMorgan Asset Management
Location: New York, NY
Strategy: Long/Short Equity
AUM: $32.89 billion

3. Paulson & Co.
Location: New York, NY
Strategy: Credit, Multi Strategy, Merger Arbitrage
AUM: $29.00 billion

4. D.E. Shaw & Company
Location: New York, NY
Strategy: Multi Strategy, Global Macro
AUM: $28.60 billion

5. Och-Ziff Capital Management
Location: New York, NY
AUM: $22.10 billion

6. Soros Fund Management
Location: New York, NY
Strategy: Global Macro
AUM: $21.00 billion

7. Goldman Sachs Asset Management
Location: New York, NY
AUM: $20.59 billion

8. Renaissance Technologies Corporation
Location: East Setauket, NY
Strategy: Quantitative Long/Short Equity
AUM: $20.00 billion

9. Farallon Capital Management
Location: San Francisco, CA
Strategy: Multi Strategy
AUM: $20.00 billion

10. Baupost Group
Location: Boston, MA
AUM: $16.80 billion

11. Moore Capital Management
Location: New York, NY
Strategy: Global Macro, Fixed Income, Long/Short Equity
AUM: $16.50 billion

12. Avenue Capital Group
Location: New York, NY
Strategy: Distressed Debt
AUM: $16.20 billion

13. King Street Capital Management
Location: New York, NY
AUM: $15.90 billion

14. Angelo, Gordon & Company
Location: New York, NY
Strategy: Multi strategy
AUM: $14.00 billion

15. Fortress Investment Group
Location: New York, NY
Strategy: Global Macro, Event Driven
AUM: $13.66 billion

16. Lone Pine Capital
Location: Greenwich, CT
Strategy: Long/Short Equity
AUM: $13.00 billion

17 . Elliott Management Corporation
Location: New York, NY
AUM: $12.80 billion

18. Eton Park Capital
Location: New York, NY
Strategy: Multi Strategy
AUM: $12.00 billion

19. SAC Capital Advisors
Location: Stamford, CT
AUM: $12.00 billion

20. Cerberus Capital Management
Location: New York, NY
Strategy: Distressed Debt
AUM: $11.90 billion

21. FX Concepts
Location: New York, NY
Strategy: Emerging Market Debt
AUM: $11.74 billion

22. Millenium Management
Location: New York, NY
Strategy: Multi Strategy
AUM: $11.70 billion

23. Tudor Investment Corporation
Location: Greenwich, CT
Strategy: Long/Short Equity, Global Macro
AUM: $11.37 billion

24. Citadel Investment Group
Location: Chicago, IL
Strategy: Multi Strategy
AUM: $10.72 billion

25. TPG-Axon Capital Management
Location: New York, NY
Strategy: Global Macro
AUM: $10.60 billion

26. ESL Investments
Location: Greenwich, CT
AUM: $10.50 billion

27. Duquesne Capital Management
Location: Pittsburgh, PA
Strategy: Distressed Debt, Multi Strategy
AUM: $10.00 billion

28. Wellington Capital Management
Location: Boston, MA
AUM: $10.00 billion

29. GoldenTree Asset Management
Location: New York, NY
AUM: $10.00 billion

30. Davidson Kempner Capital Management
Location: New York, NY
Strategy: Distress Debt, Long/Short Equity, Multi Strategy
AUM: $9.70 billion

31. Maverick Capital
Location: New York, NY
Strategy: Long/Short Equity
AUM: $9.70 billion

32. Viking Global Investors
Location: Greenwich, CT
AUM: $9.66 billion

33. Canyon Capital Advisors
Location: Los Angeles, CA
Strategy: Arbitrage
AUM: $9.38 billion

34. GMO
Location: Boston, MA
AUM: $9.00 billion

35. Bain Capital
Location: Boston, MA
AUM: $8.80 billion

36. Stark Investments
Location: St. Francis, WI
Strategy: Multi Strategy, Emerging Markets
AUM: $8.67 billion

37. Convexity Capital Management
Location: Boston, MA
AUM: $8.50 billion

38. QVT Financial
Location: New York, NY
Strategy: Multi Strategy
AUM: $8.50 billion

39. Perry Capital
Location: New York, NY
Strategy: Multi Strategy
AUM: $8.33 billion

40. Adage Capital Management
Location: Boston, MA
AUM: $8.00 billion

41. Caxton Associates
Location: New York, NY
AUM: $8.00 billion

42. Atticus Capital
Location: New York, NY
Strategy: Activist
AUM: $8.00 billion

43. York Capital Management
Location: New York, NY
Strategy: Event Driven, Distressed Debt, Multi Strategy
AUM: $7.80 billion

44. Highfields Capital Management
Location: Boston, MA
AUM: $7.80 billion

45. Black River Asset Management
Location: Minnetonka, MN
Strategy: Multi Strategy
AUM: $7.44 billion

46. Harbinger Capital Partners
Location: New York, NY
AUM: $7.10 billion

47. Taconic Capital Advisors
Location: New York, NY
AUM: $7.10 billion

48. Magnetar Capital
Location: New York, NY
AUM: $7.10 billion

49. HBK Capital Management
Location: Dallas, TX
Strategy: Multi Strategy
AUM: $7.10 billion

50. Marathon Asset Management
Location: New York, NY
Strategy: Emerging Markets, Long/Short Equity, Event Driven, Distressed Debt
AUM: $7.00 billion

Source: Institutional Investor

Also, see the list of the Top 100 Largest Hedge Funds in the World

Top Hedge Fund Countries

2009-08-06T12:48:00.000-07:00

Below is a list of countries with the most hedge funds listed in the Top 100 Largest Hedge Funds:

# 1. USA - 76%
#2. United Kingdon - 19%
#3. France - 1%
#4. Japan - 1 %
#5. Sweden - 1%
#6. Brazil - 1 %

As you can see, more than three quarters of the world's largest hedge funds are located in the US, with fully 56% of the US' largest funds based out of New York. New York has more funds in the hedge fund 100 than all other countries combined. However, these numbers do not fairly depict the number of hedge funds in each country for all funds. Large funds are disproportionately located in mega financial centers like New York and London.

Top Hedge Fund Cities (Based on AUM)

2009-08-06T12:21:00.000-07:00

Below is a list of the top hedge fund cities based on assets under management (for Top 100 hedge funds).

#1. New York - 46.6%
#2. London - 20.5%
#3. Boston - 6.9%
#4. Greenwich - 6.5%
#5. Wesport - 3.9%
#6. San Francisco - 2.7%

The above list of top hedge fund cities in the world is based on assets under management at the Top 100 Largest Hedge Funds

The Top Hedge Fund Cities - Most Hedge Funds

2009-08-06T12:12:00.000-07:00

Below is a breakdown of the cities with the most hedge funds, based on the Top 100 Hedge Funds.

#1 New York - 43% of largest hedge funds
#2 London - 19% of largest hedge funds
#3 Boston - 6% of largest hedge funds
#4 Greenwich - 6% of largest hedge funds
#5 Dallas - 3% of largest hedge funds
#6 San Francisco - 2% of largest hedge funds

The above list of top hedge fund cities in the world is based on number of firms listed on the Top 100 Largest Hedge Funds

Top 100 Largest Hedge Funds

2009-08-06T09:52:00.000-07:00

Below is a list of the 100 largest hedge funds in the world including location and AUM (assets under management) as of 2009.

1. Bridgewater Associates
Location: Westport, CT
AUM: $38.00 billion

2. JPMorgan Asset Management
Location: New York, NY
AUM: $32.89 billion

3. Paulson & Co.
Location: New York, NY
AUM: $29.00 billion

4. D.E. Shaw & Company
Location: New York, NY
AUM: $28.60 billion

5. Brevan Howard Asset Management
Location: London, UK
AUM: $26.84 billion

6. MAN Investments
Location: London, UK
AUM: $24.40 billion

7. Och-Ziff Capital Management
Location: New York, NY
AUM: $22.10 billion

8. Soros Fund Management
Location: New York, NY
AUM: $21.00 billion

9. Goldman Sachs Asset Management
Location: New York, NY
AUM: $20.59 billion

10. Renaissance Technologies Corporation
Location: East Setauket, NY
AUM: $20.00 billion

11. Farallon Capital Management
Location: San Francisco, CA
AUM: $20.00 billion

12. Barclays Global Investors
Location: London, UK
AUM: $17.00 billion

13. Baupost Group
Location: Boston, MA
AUM: $16.80 billion

14. BlueBay Asset Management
Location: London, UK
AUM: $16.70 billion

15. Moore Capital Management
Location: New York, NY
AUM: $16.50 billion

16. Avenue Capital Group
Location: New York, NY
AUM: $16.20 billion

17. King Street Capital Management
Location: New York, NY
AUM: $15.90 billion

18. Angelo, Gordon & Company
Location: New York, NY
AUM: $14.00 billion

19. Fortress Investment Group
Location: New York, NY
AUM: $13.66 billion

20. BlueCrest Capital Management
Location: London, UK
AUM: $13.27 billion

21. Lone Pine Capital
Location: Greenwich, CT
AUM: $13.00 billion

22. Elliott Management Corporation
Location: New York, NY
AUM: $12.80 billion

23. Winton Capital Management
Location: London, UK
AUM: $12.40 billion

24. Eton Park Capital
Location: New York, NY
AUM: $12.00 billion

25. SAC Capital Advisors
Location: Stamford, CT
AUM: $12.00 billion

26. Landsowne Partners
Location: London, UK
AUM: $12.00 billion

27. Cerberus Capital Management
Location: New York, NY
AUM: $11.90 billion

28. FX Concepts
Location: New York, NY
AUM: $11.74 billion

29. Millenium Management
Location: New York, NY
AUM: $11.70 billion

30. GLG Partners
Location: London, UK
AUM: $11.50 billion

31. Tudor Investment Corporation
Location: Greenwich, CT
AUM: $11.37 billion

32. Citadel Investment Group
Location: Chicago, IL
AUM: $10.72 billion

33. Axon Capital Management
Location: New York, NY
AUM: $10.60 billion

34. ESL Investments
Location: Greenwich, CT
AUM: $10.50 billion

35. Duquesne Capital Management
Location: Pittsburgh, PA
AUM: $10.00 billion

36. Wellington Capital Management
Location: Boston, MA
AUM: $10.00 billion

37. GoldenTree Asset Management
Location: New York, NY
AUM: $10.00 billion

38. Davidson Kempner Capital Management
Location: New York, NY
AUM: $9.70 billion

39. Maverick Capital
Location: New York, NY
AUM: $9.70 billion

40. Viking Global Investors
Location: Greenwich, CT
AUM: $9.66 billion

41. The Children's Investment Fund
Location: London, UK
AUM: $9.40 billion

42. Canyon Capital Advisors
Location: Los Angeles, CA
AUM: $9.38 billion

43. Sloane Robinson
Location: London, UK
AUM: $9.10 billion

44. GMO
Location: Boston, MA
AUM: $9.00 billion

45. Bain Capital
Location: Boston, MA
AUM: $8.80 billion

46. Stark Investments
Location: St. Francis, WI
AUM: $8.67 billion

47. Convexity Capital Management
Location: Boston, MA
AUM: $8.50 billion

48. QVT Financial
Location: New York, NY
AUM: $8.50 billion

49. Perry Capital
Location: New York, NY
AUM: $8.33 billion

50. Adage Capital Management
Location: Boston, MA
AUM: $8.00 billion

51. Caxton Associates
Location: New York, NY
AUM: $8.00 billion

52. Atticus Capital
Location: New York, NY
AUM: $8.00 billion

53. York Capital Management
Location: New York, NY
AUM: $7.80 billion

54. Highfields Capital Management
Location: Boston, MA
AUM: $7.80 billion

55. Black River Asset Management
Location: Minnetonka, MN
AUM: $7.44 billion

56. Harbinger Capital Partners
Location: New York, NY
AUM: $7.10 billion

57. Taconic Capital Advisors
Location: New York, NY
AUM: $7.10 billion

58. Magnetar Capital
Location: New York, NY
AUM: $7.10 billion

59. HBK Capital Management
Location: Dallas, TX
AUM: $7.10 billion

60. Marathon Asset Management
Location: New York, NY
AUM: $7.00 billion

61. Blue Ridge Capital
Location: New York, NY
AUM: $7.00 billion

62. HSBC
Location: London, UK
AUM: $6.90 billion

63. Mariner Investment Group
Location: Harrison, NY
AUM: $6.80 billion

64. Symphony Asset Management
Location: San Francisco, CA
AUM: $6.70 billion

65. Marshall Wallace
Location: London, UK
AUM: $6.60 billion

66. Horseman Capital Management
Location: London, UK
AUM: $6.52

67. CQS
Location: London, UK
AUM: $6.50 billion

68. Silver Point Capital
Location: Greenwich, CT
AUM: $6.5 billion

69. Shumway Capital Partners
Location: Greenwich, CT
AUM: $6.50 billion

70. AQR Capital Management
Location: Greenwich, CT
AUM: $6.40 billion

71. Gartmore Investment Management
Location: London, UK
AUM: $6.16 billion

72. Anchorage Advisors
Location: New York, NY
AUM: $6.00 billion

73. Kynikos
Location: New York, NY
AUM: $6.00 billion

74. BlackRock
Location: New York, NY
AUM: $5.61 billion

75. Tiger Asia Management
Location: New York, NY
AUM: $5.60

76. Morgan Stanley Investment Management
Location: New York, NY
AUM: $5.50 billion

77. Dexia Asset Management
Location: Paris, France
AUM: $5.47 billion

78. Sparx Group
Location: Tokyo, Japan
AUM: $5.43 billion

79. Alternative and Quantitative Investments
Location: Chicago, IL
AUM: $5.43 billion

80. Spinnaker Capital
Location: London, UK
AUM: $5.40 billion

81. Cheyne Capital Management
Location: London, UK
AUM: $5.23 billion

82. AllianceBernstein
Location: New York, NY
AUM: $5.1 billion

83. Greenlight Capital
Location: New York, NY
AUM: $5.1 billion

84. Appaloosa Management
Location: Chatham, NJ
AUM: $5.1 billion

85. Galleon Group
Location: New York, NY
AUM: $5.00 billion

86. Cantillon Capital Management
Location: New York, NY
AUM: $5.00 billion

87. Centaurus Energy
Location: Houston, TX
AUM: $5.0o billion

88. Thames River Capital
Location: London, UK
AUM: $4.9 billion

89. Campbell & Co.
Location: Towson, MD
AUM: $4.9 billion

90. Graham Capital Management
Location: Rowayton, CT
AUM: $4.72 billion

91. Pershing Square Capital Management
Location: New York, NY
AUM: $4.70 billion

92. Icahn Capital
Location: New York, NY
AUM: $4.63 billion

93. BlueMountain Capital Management
Location: New York, NY
AUM: $4.60 billion

94. Glenview Capital Management
Location: New York, NY
AUM: $4.46 billion

95. Varde Partners
Location: Minneapolis, MN
AUM: $4.40 billion

96. Brummer and Partners
Location: Stockholm, Sweden
AUM: $4.39 billion

97. Tewksbury Capital Management
Location: Hamilton, Bermuda
AUM: $4.30 billion

98. Aspect Capital
Location: London, UK
AUM: $4.30 billion

99. Credit Suisse Hedging
Location: Sao Paulo, Brazil
AUM: $4.24 billion

100. Carlson Capital
Location: Dallas, TX
AUM: $4.23 billion

Source: Institutional Investor

Full Contact Info for 3500+ Hedge Funds

Brazilian Hedge Funds See Huge Inflows

2009-08-05T10:24:00.000-07:00

Brazilian hedge funds had more than $4.5 billion in inflows during the month of July. This is the largest monthly inflow to Brazilian hedge funds ever. The increased investor appetite comes amid low global interests and increased demand for riskier, higher yielding assets.

Brazilian hedge funds manage about $150 billlion in total assets. The July inflows represent an increase of about 3%.

The Brazilian stock market, Bovespa, had its best month in July in more than 10 years.

Hedge Fund Database Reviews

2009-07-25T14:56:00.001-07:00

Review of the Best Hedge Fund Directories -2009

Have you been looking for a quality hedge fund directory or hedge fund database, but not sure what you get for the money? If you are like many of our readers, apparently the answer is yes. There are at least a dozen providers of hedge fund information. Many supply an online database, while others allow users to download the information for use with Excel or other spreadsheet programs. Three of the four hedge fund databases below provide performance information designed for investors and are only available to qualified investors.

Also note that while each hedge fund database/directory claims to cover a different number of funds, for the most part they have similar coverage. Much of the difference in “number of hedge funds” stems from the number of repeat listings.

Best Hedge Fund Directories:

1. BarclayHedge (Overall Winner!)

Price: $4,500

The BarclayHedge Hedge Fund Database Barclay’s contains comprehensive information on more than 4,000 Hedge Funds and Funds of Hedge Funds. Barclay’s database is probably the best known and most respected hedge fund directory available. Constantly updated, their database is the go to source for hedge fund and fund of fund quantitative information. Barclay’s also sells a purely Fund of Funds directory which is available for $1,200.

Despite the sometimes prohibitive price, Barclay’s Hedge Fund Database remains the most valulable single tool for investors and serious researchers needing up-to-date performance information. For an additional $4,500, users can get access to the unbeatable Barclay’s Contact Marketing Database which provides contact information for hedge funds, fund of funds and CTA managers.

2. HedgeFundContacts (Best Value!)

Price: $137 + $240 for downloads

At less than $400 including downloads (or $137 for fully searchable online database), HedgeFundContacts.com is the clear winner in the Best Value , Hedge Fund Database category. Their online database is easy to use and offers more search options than many more expensive competitors. In addition to several thousand hedge funds, they also provide updated contact info on fund of hedge funds, and private equity firms. They just added People Search, a very cool and unique feature, which gives users access to a database (including email addresses) of more than 8,000 hedge fund professionals including a surprising number of CEOs and Managing Directors.

Amazingly, their contact Database rivals that of the much more expensive BarclayHedge and is a much more affordable option for job hunters, marketers, and other research. Because HedgeFundContacts is a contact database they not supply performance information. The upside is they provide better contact information and more valid email addresses than virtually any other competitor and their database is available to non-qualified investors.

3. HedgeCo

Price: $2,500 + $2,500 for downloads

HedgeCo provides a searchable online database as well as the ability to download the results to Excel. Includes quantitative and qualitative data on single manager hedge funds, funds of hedge funds, CTAs, and a variety of other alternative investment products. The database is of good quality, though with a number of repeat listings. However, at $5000 with downloads, the HedgeCo database is priced at the upper end of the elite hedge fund directories and is only available to qualified investors.

4. Eurekahedge

Price: $3,500

The Eurekahedge North American Hedge Fund Database provides online access to a database of 2,675 hedge funds throughout North America. Subscribers also get a hard copy version of the database and free monthly online newsletters. While a valuable tool, the database does not appear to be updated as often as others. Eurekahedge also makes available their Global Hedge Fund Database which is available for $12,000 and a Fund of Funds database for $3,000.

Of course, there are many other hedge fund directories available. However after reviewing dozens of competitors, we selected the four above because of the high quality of their listings, frequent updates, and ease of use. Job hunters, recruiters, and those wishing to market to hedge funds will get the best value from wildly under-priced HedgeFundContacts.com. For investors, pension fund managers, and research institutions, we suggest the overall winner of our Hedge Fund Database Review, the BarclayHedge database.

Long Island Hedge Fund Subpoenaed by SEC

2009-07-25T14:01:00.000-07:00

NIR Group, the Long Island hedge fund firm run by Corey Ribotsky, 38, is the focus of an SEC investigation focusing on the performance valuations of its hedge funds. Also under investigation are communications NIR made to investors.

The SEC has said that Mr. Ribotsky also lied about the returns and the holding of an assortment of funds. People familiar with the matter said Corey Ribotsky and NIR Group have defrauded their investors, after poor performance over recent months.

The SEC also requested that NIR provide yearly, monthly and quarterly fund performance returns from January 2004 till the present and all documents related to NIR's internal performance calculation process.

NIR Group was founded by Mr. Ribotsky in 1998 and focuses on small/micro cap companies.

You can go to Corey Ribotsky's personal website here.

Or visit NIR Group

Fortress to Acquire Rival Hedge Funds?

2009-07-25T13:47:00.000-07:00

Fortress Investment Group, the $27 billion dollar hedge fund originally founded as a Private Equity firm by Wesley R. Edens in 1998, announced plans to acquire or purchase a range of financial firms, including other hedge funds.

Recently appointed CEO of Fortress Group, Daniel Mudd, has publicly stated Fortress' intent to acquire insurers, banks, traditional money managers and rival hedge funds.

Many alternative investment industry analysts have predicted declining numbers of hedge funds as well as decreased hedge fund assets under management due to the poor markets and returns, as well as a growing mistrust of fund managers. But if other large hedge funds begin to poach on smaller rivals, consolidation may be also be a significant driver of decreasing numbers of hedge funds.

Fortress Investment Group Founder, Wesley Edens, was one of a couple hedge fund managers named to Forbes Magazines' "Biggest Billionaire Losers of 2008"

Hedge Fund Founder Quits After JP Morgan Acquisition

2009-06-13T11:00:00.000-07:00

Founder of Highbridge Capital Management, Henry Swieca, revealed plans to leave the firm after JP Morgan moved to purchase the remainder of the giant hedge fund. Highbridge Capital Management is one of the world's largest hedge funds with around $20 billion in AUM (assets under management). In 2008, Henry Swieca ranked in the top 100 on Forbes list of billionaires, with an estimated net worth of $1.3 billion.

Highbridge Capital Management, LLC is a global alternative investment and asset management firm based in New York with offices in London, Hong Kong and Tokyo, with over 310 employees and 100 investment professionals. Highbridge manages approximately $20 billion of capital for financial institutions, corporate pension funds, university endowments and family offices.

DE Shaw Group to Lighten Redemption Restrictions

2009-06-13T10:55:00.000-07:00

D.E. Shaw & Co., the $29 billion investment firm founded by David Shaw, will permit investors to withdraw more money from its two biggest funds than previously permitted, according to Bloomberg.

DE Shaw recently limited quarterly redemptions in November to 8.3 percent of investor assets after a surge in withdrawal requests. The NYC-based firm is now offering clients the one-time option to pull 16 percent of their assets from two of its funds, its Oculus and Composite funds, next month. Those who accept won’t be able to make additional withdrawals this year.

Hedge Funds Post Best Performance in Nine Years

2009-06-13T10:52:00.000-07:00

Hedge funds returned an average of 5.2% in May, 2009, the best cumulative return since 2000. edge-fund managers are outperforming global benchmarks after posting the worst year on record in 2008. Eurekahedge’s global index slid 12 percent last year, the most since the Singapore-based firm began tracking data in 2000. The MSCI Asia Pacific Index rose for a third month in May, advancing 12 percent in its longest stretch of monthly gains since July 2007.

Read the full article

I Thought This Fund Was Market Neutral?!?!

2009-05-15T12:45:00.000-07:00

Hedge Funds Skeptical of Uncle Sam

2009-05-15T12:39:00.000-07:00

According to Reuters, many hedge fund managers are leery of US intervention in the capital markets, from banking bailouts to Chrysler and the automakers.

According to Sean Mathis of New Centurion Capital Partners,"When you have government intervention at the scale we have, you do something the markets abhor: you create uncertainty. We have uncertainty where markets are going and what the rules of the road will be."

Even more drastic are statements like those of Gary Kaminsky, former Managing Director at Neuberger Berman "You have to assume the government will be involved. You have to assume the free market is not as free as it was in the past and won't be for the next 20 years," Kaminsky said.

Of course what is not being said is that hedge funds have benefited from the bailout in countless ways. Many of the prime brokers to hedge funds could have been at risk had large financial institutions not received bailout money. Most hedge funds with a long-bias have also benefited from the massive injection of money into the system and the support of the financial sector.