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TT International
From sovereign wealth funds that jumped in too early, to shareholders spurning the rights issues of UK banks, financial stocks are currently a dirty word with long only investors. But the advantage of hedge fund investing is the opportunity to generate returns across the cycle. The Hedge Fund Journal spoke with the investment team at TT International’s Financials Long/Short Fund, who have proved that market turmoil is no obstacle to performance. > read more
Profiles
Liongate Capital Management
One version of the origins of this traditional
nursery rhyme is that ‘jumping over a
candlestick’ was a way of foretelling the future.
Funds of hedge fund managers are not blessed
with perfect foresight, but an ability to recognise
imminent trend changes and nimbly adapt to the
new circumstances is a distinct advantage. The
Hedge Fund Journal spoke with Randall Dillard,
Partner and Chief Investment Officer of Liongate
Capital Management about the company’s
investment strategy, which combines top-down
analysis with active capital re-allocation.
> read more
Manager Writes
Funds of Hedge Funds
Once in a while commentators turn on the funds
of hedge funds industry by criticising performance
and fees. And lately, the industry has also been
competing with replication strategies offered by
investment banks and market indices. Warren
Buffet has bet US$1 million that the S&P 500 will
outperform a given fund of funds over a decade.
> read more
Research
Equity Portfolio Construction
If ever asked to characterise the word ‘optimisation’,
many of us would draw a black box with the secret
hope of never having to look into it.</p>
<p>Yet every day, without noticing, we are exposed to
the predictability of optimisation tools. Have you ever
queued for a lift, hoped for mobile phone reception
in a busy airport, or used a web search engine? These
are just a few examples of every day processes that
use optimisation.
> read more
Opinion
Eurex OTC Trade Facilities
Given the current turmoil in financial markets
the greatest challenge currently facing the asset
management industry is counterparty risk. The
introduction of the UCITS III legislation, the growth
of portable alpha investing and recently, extension
(i.e. 130/30) investing have all contributed to
the huge growth in the use of derivatives by
the fund management industry.
> read more
Profiles
BNP Paribas Securities Services
It has been obvious to hedge fund commentators
for a long time now that the industry is changing.
It is becoming more institutional, both in the way
that hedge fund firms operate and in terms of the
sources of the capital they manage. This is having
a profound effect on day-to-day business practices
and, in turn, is also changing the way hedge funds
are serviced.
> read more
Technical
Hedge Fund Manager Transactions
Despite considerable growth in recent years,
the hedge fund industry remains fragmented,
split between a small number of relatively large
participants and many smaller players. Favourable
economic conditions and investor demand for hedge
fund returns have supported the growth and have
provided opportunities for new firms to set up.
> read more
Research
Remonopolising Alpha
One-stop alpha beta shopping has given way
to a more discriminating approach to portfolio
construction. Against this background, the shifts
in the hedge fund industry are nothing short of
paradigmatic.
> read more
Also in this Issue
Shorting
As the bull market faded in 2007, long/short funds
finally had an opportunity to show their paces. In
the four year bull run, most hedge funds captured
some market direction; the downturn was the
chance for funds to show they could change tack.
> read more
Multi-Asset Class Investing
Over the long term, investors have received a
premium in return for investing their capital in risky
assets, whether it is in equities, bonds, property or
commodities. Over the past decade, equities have
not delivered any capital return to investors and,
during the ‘tech wreck’, investors who invested
solely in equities lost 40% of their capital.
> read more
Four Imperatives for Hedge Funds
As assets under management (AUM) in hedge funds
approach US$2 trillion globally, and as institutional
demands and inflows increasingly drive the
alternative investment market, industry leaders are
facing an inflection point. It is no longer enough for
top funds just to ride the wave of growth. Indeed,
the maturing hedge fund industry is presenting new
challenges, as well as opportunities, every day.
> read more
Where is the “Hedge” in Hedge Funds?
Since the credit crisis began last summer, global
capital markets have been hit with a tsunami of
historical volatility and asset deleveraging. The
role of hedge funds in this crisis has become a
leading topic of discussion among government
regulators, the financial media and hedge fund
investors. Overall, the performance of the industry
throughout this crisis has left a lot to be desired.
> read more
Dispute Resolution Clauses
Commercial partners, like marrying couples, rarely
think about divorce when tying the knot. For this
reason, dispute resolution provisions are sometimes
overlooked when drafting hedge fund agreements,
and other contractual documentation.
> read more
Tackling Global Change
Look into the future, and what do you see?
Shortages of natural resources, including water?
An ongoing need for improved infrastructure in
emerging economies? A pressing need to convert
to cleaner energy technologies as the planet
warms up?
> read more
Interview
As demand for alternative investments continues to
grow, the lines between hedge funds and traditional long only managers are becoming increasingly blurred. Some managers, however, have always maintained a strong presence in both areas of asset management.
> read more
Pinpoint Investments
Times are changing in the world of Asian investing.
In the last great Asian markets boom, in the
mid-1990s, Greater China was one of a number
of investment options asset allocators could
consider in the region. Now, it has become the
dominant strategic play.
> read more
People
Amit Rajpal will join Marshall Wace, the 7th largest
European manager in The Hedge Fund Journal
Europe 50, to spearhead the October launch of the
new Marshall Wace Global Financials fund. Rajpal is
joining from Morgan Stanley where, most recently,
he was Head of Asian Proprietary Trading based in
Hong Kong and responsible for the Global Financials
Portfolio. Prior to this, he was Morgan Stanley’s
Head of Global FIG Research and before that Head
of Asian FIG Research.
> read more
