Hedge Fund News Wrap: Week Ending 3/7/14

Hedge Funds Rise 1.59 Percent in February

According to the HRFX Global Hedge Fund Index, the average hedge fund rose 1.59 percent in February. While hedge funds enjoyed broad gains in February, they lagged behind the broader market, with the S&P 500 rising more than 4 percent in February.

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According to FINalternatives, the top performing strategies for February include fundamental growth funds (4.16 percent, 4.54 percent YTD), special situation funds (2.99 percent, 3.17 percent YTD), and equity hedge funds (2.55 percent, 1.63 percent YTD).

February’s worst performing strategies include trading advisers, which fell 0.75 percent, with total gains of only 0.82 percent YTD. Systematic diversified CTAs took the hardest hit, shedding 1.42 percent in February, with total gains of 1.23 percent YTD.


See detailed coverage from:

FINalternatives

Opalesque

CNN Money

 

 

Hedge Fund, Fortress, Loses $3.7M on Bitcoin

The Fortress Investment Group has reported a loss of $3.7 million from investments in bitcoin. Fortress was the first large public company to disclose a stake in the virtual currency.

The alternative investments company had invested a total of $20 million in Bitcoin in early 2013, and as of December 1st 2013, the stake was worth less than $17 million.

Fortress’ disclosure of a paper loss comes weeks after Mt. Gox, one of the first and largest bitcoin exchanges in the world, filed for bankruptcy. Allegedly, hackers stole half a billion dollars’ worth of bitcoins, prompting the exchange to close.

According to DealBook, large banks are hesitant to invest in bitcoin due to the virtual currency’s volatility and lack of regulation.

See detailed coverage from:

DealBook

FINalternatives

 

 

Marcato Supports Third Point on Sotheby’s Proxy Fight

Dan Loeb’s hedge fund, Third Point, has gained the support of Marcato Capital Management in its proxy battle against Sotheby’s. Last month, Third Point revealed that it was nominating three executives to serve on the board of the auction house, with one nominee replacing founder and CEO, William Ruprecht.

The three nominees are Harry Wilson, chairman and CEO of MAEVA Group LLC; Olivier Reza, the lead designer and head of House of Alexandre Reza; and Dan Loeb himself.

In its regulatory filing with the Securities and Exchange Commission, Third Point stated that the current directors of Sotheby’s lack the “fresh perspective required to overhaul its challenging operational structure and fix its cultural malaise.” The hedge fund owns a 9.5 percent stake in Sotheby’s, and is its largest shareholder.

Marcato, which has a 6.6 percent stake in the auction house, has also called on Sotheby’s to return capital to shareholders, and is focused on the company’s real estate holdings.

See detailed coverage from:

ValueWalk

FINalternatives

Bloomberg Businessweek

 

 

SAC Capital Makes Big Payout, Signals Transition

According to a report by The Wall Street Journal, SAC Capital Advisors paid out bonuses and deferred compensation for its remaining employees. The move could open the door for more employee departures, as the hedge fund seeks to transform itself into a family office.

At the same time, by deferring its compensation, SAC is hoping to retain some of its top talent. Under the new terms, employees who stay through 2014 will have more relaxed rules about pay that is deferred until later years.

The Wall Street Journal reports that although the troubled hedge fund firm is shrinking down to a family office, it is still hiring both junior and senior investment professionals. SAC plans to unveil a new name for the family office in April.

 

See detailed coverage from:

The Wall Street Journal

FINalternatives