Newsreel: Why the Madoff saga doesn’t support “clamping down” on HF industry, 80% of HFs gone by spring, bad things happening to good funds and other ‘09 predictions
Dec 28th, 2008 | Filed under: AAA Newsreels, Today's Post
End of the Hedge Fund? Unlikely, according to Washington Post columnist Sebastian Mallaby who writes, “Even if you define Madoff’s investment outfit as a hedge fund, which for various reasons is debatable, there’s nothing in this saga that supports clamping down on the industry.”
Hedge funds return to roots as alpha claim refuted: This prediction of the hedge fund apocalypse tops all others. Robert McAdie, a credit strategist at Barclays Capital, was quoted by Reuters last week as saying “Eighty percent of the hedge fund sector will not be here in three to four months“. Check back in April for an update…
Regular readers may recall this post on “hedge fund forum shopping” – the theory that hedge funds search out the least-regulated jurisdictions in which to ply their trade. AIMA’s Canadian chapter announced last week that the study cited in this post was the recipient of the organization’s annual research award. If you want to compare jurisdictions side-by-side, this study is the place to start.
Man bites dog!…GLG Partners to buy SocGen UK asset management arm: Here’s an addendum to our recent post on hedge funds being snapped up by traditional asset managers. Except this time, the hedge fund is the one doing the buying.
In another twist on the traditional, T. Boone Pickens has reportedly decided to unilaterally relax quarterly redemption and 90-day notice rules on his equity fund – begging the question, why did he have these liquidity rules in the first place?
University endowments may reduce their hedge fund exposure next year, but not for the reason you might think. Quoting InvestHedge, Bloomberg reports that “Hedge funds might be put ‘on the backburner’ when endowments have to fulfill previous obligations to private-equity managers.”
And here’s another problem faced by otherwise healthy hedge funds…J.W. Henry worries that even strong hedge funds may go under.
Breaking Views reports on “six changes they [hedge funds] need to prepare for” (via IHT). One is that industry concentration will accelerate.
But Portfolio.com’s Jesse Eisinger has a different view. Writes Eisinger: “Most hedge fund watchers think the biggest fund managers will only get bigger. But that’s hard to see…”
At least hedge funds aren’t the only ones looking at a huge drop in fees next year. Thomson reports that “UK unit trusts and open ended investment companies have seen rises in both TERs [total expense ratios] and annual management fees for equity funds for the past ten years.”
Related Posts
- Newsreel: “Subscription gates”, Darwin and free trade in hedge funds
- Post-Madoff HF Investors: Some stop, some go, and some start their own funds
- Newsreel: Hedge funds described as “victims”, “easy targets”, but investors and managers remain bullish on 2009
- Newsreel: Kitzbuhel, talent for a song, hand-me-down hedge funds, and mending lending
- Newsreel: Investors not giving up on injured hedge funds
