Hedge Fund Focus: April 22, 2016
In case you missed them, here are the hot topics in the hedge fund/alternatives space this week…
March data continues to show a recovery may be on the horizon with positive news across the board:
- eVestment reported 70 percent of funds were in the black for March
- All of IndexIQ’s indices were positive for the month
- Nine of Lyxor’s 11 indices were in the black for the month
- BarclayHedge’s index was up 2.53 percent for the month
- And the Greenwich Global Hedge Fund Index was up 1.88 percent for the month
The rebound is helping some industry leaders bounce back with Boa Weinstein, who suffered heavy losses last year, reporting gains of 11.6 percent YTD and Ackman reporting an upswing in April. However, not everyone was having the same experience. Odey is down 31 percent, John Paulson has lost $2B, Blackstone’ Senfina lost 15 percent, Lone Pine is down 8 percent and Citadel’s multi-strat funds are down 6.9 percent.
Additionally and unfortunately, the bounce back has not carried over to April. Lyxor has funds slightly down for the month. And it hasn’t helped stem the tide of the turbulent last 9 months, which are finally showing their full impact – 2016 Q1 saw the heaviest round of outflows since the financial crisis, $15B in the three-month period. The redemptions, due to fees and poor performance, also marked the first Q1 industry AUM decline since 2009.
Interestingly though, EurekaHedge contradicted HFR’s findings, reporting industry inflows of almost the same amount for the same time period and SS&C GlobeOp’s forward redemption indictor showed that outflows have dipped in April, the lowest reading since January.
Och-Ziff’s current battle with the Justice Department over an ongoing bribery investigation is taking its toll on the firm in more ways than one. Its share price has tumbled 45 percent this year alone and 70 percent over the last 12 months. Additionally, its assets have declined by more than $3.5B YTD and all its funds are in the red for 2016.
There was lots of speculation around the effect NYCERS’ decision to pull all its hedge fund investments would have on other pensions. However, a poll by HFMWeek found that 50 percent of managers do not believe it will have broad implications and lead to other institutions following suit.
On the activist front, United Continental Airlines has reached an agreement with activist investors over the company’s board, preventing a public fight. Under the agreement, United will appoint two new board directors chosen by the activists.
FAST, FUN FACTS: Steven Cohen’s new hedge fund Stamford Harbor Capital will not seek outside money until Cohen’s SEC ban expires. The announcement came on the heels of criticism from Senator Elizabeth Warren towards the SEC for allowing Cohen a pathway back to running a hedge fund so quickly.