by Staff Writer on May 18, 2012
Lessons From a Hedge Fund Conference [BusinessWeek] Every year, the Ira Sohn foundation invites a group of esteemed money managers to present investment ideas to raise money for pediatric cancer and other children’s illnesses. And every year, those ideas are picked over by investors like jackals around a carcass. For a first-time attendee at this year’s conference on May 16, a few things stood out after six hours of listening to some of the industry’s top figures.
Magnetar, Notorious Hedge Fund, Has Been In Trouble Many Times Before [HuffingtonPost] The hedge fund Magnetar helped create billions of dollars’ worth of risky deals called collateralized debt obligations, many of which failed spectacularly in the financial crisis. Magnetar, meanwhile, had taken positions that allowed the firm to profit when many of those same CDOs collapsed. Since ProPublica reported on Magnetar’s dealings two years ago, there’s been a long line of investigations and settlements related to the hedge fund.
I Was In The Room When Boaz Weinstein Revealed His Trade That Creamed JPMorgan [BusinessInsider] Everyone has been talking about how legendary derivatives trader Boaz Weinstein, the founder of Saba Capital and former co-head of credit trading at Deutsche Bank, is the man on the other side of the disastrous JPMorgan trade.
I was there on February 2 when Weinstein recommended buying the Investment Grade Series 9 10-Year Index CDS, which is reportedly the same security the JPMorgan desk was short.
Why You Shouldn’t Take Any Advice From This Week’s Big Hedge Fund Conference [BusinessInsider] I wasn’t really aware of the Ira Sohn Conference, but some very big names were there. As Richard Posner pointed out, however, intellectual reputation invariably lags achievement, so the biggest names almost by definition are over the hill. A great example of this was Ronald Coase, who remarked upon winning the Nobel Prize in 1991, “it is a strange experience to be praised in my eighties for work I did in my twenties.”
Hedge Funds Lose Ground In Early May [FINalternatives] After posting very modest gains in April, hedge funds returned to their losing ways in the first two weeks of May. The average hedge fund shed 1.22% this month through May 15, according to Hedge Fund Research’s HFRX intra-month update. The average fund is now up just 2.01% on the year, according to the HFRX Global Hedge Fund Index. All but one of the strategies and substrategies tracked by the HFRX suite were in the red for the first half of May, with only convertible arbitrage funds posting gains of 0.45% (4.35% year-to-date).