Hedge Fund News Wrap: Week Ending 4/4/14

Hedge Funds Up 1.1 Percent in Q1

According to the Hedge Fund Research’s HRFX Global Hedge Fund Index, hedge funds dropped 0.23 percent in March.

hedge_fund_news_wrapThis leaves hedge funds up by only 1.11 percent through the first quarter of the year. Hedge funds continue to underperform the broader market, as the Standard and Poor 500 rose 1.8 percent in the first quarter.

Master-limited partnerships led the way as the best performing hedge funds: they were up 2.04 percent in March, and 4.92 percent year-to-date. Systematic diversified commodity funds were the worst performers, falling 1.75 percent in March, extending their quarterly loss to 2.95 percent.

 

 

See detailed coverage from:

FINalternatives

The Wall Street Journal

 

 

SAC to Hold on to Traders With Two-Year Contracts

In an attempt to hold onto its top talent, SAC Capital Advisors is pursuing a two-year contract with top portfolio managers that would keep them at the firm until the end of 2016.

According to The New York Times’ Dealbook, the firm has also threatened to sue traders who left before their contracts expired. In addition, the firm has mandated that traders delay the start dates of their new jobs as a condition of their early departure.

As the scandal-ridden hedge fund downsizes to a family office, it has seen some of its top talent walk out the door and join competing hedge funds.

On Monday, the firm will begin to use its new name, Point72 Asset Management, and will only manage founder Steven Cohen’s $9 billion fortune.

 

See detailed coverage from:

FINalternatives

DealBook

eVestment News

 

 

Hedge Fund Founder, Fredrick Douglas Scott, Convicted of Theft

Hedge fund founder, Fredrick Douglas Scott, has been sentenced to more than five years in prison for stealing over $1 million from investors.

As CEO of ACI Capital Group LLC., Scott allegedly lied about the value of his hedge fund’s assets, causing more than $1 million in losses for investors.

“Fredrick Douglas Scott admitted that he used ACI Capital to steal his clients’ investments and fund his own lavish lifestyle.” Attorney Loretta E. Lynch said. “Rather than the historic figure he presented to the media, Scott stands revealed as a common thief who lied his way into his investors’ pockets and then continued his web of lies when confronted by the SEC. Scott has now been brought to justice for lying, cheating, and stealing for his own personal financial gain.”

In May 2010, Ebony Magazine featured Scott in its “Top 30 Under 30” piece, and called him, “the youngest African-American hedge fund founder in history.”

 

See detailed coverage from:

HedgeCo

NY Daily News

 

 

Juniper Networks to Cut Jobs by 6 Percent, Pressure from Hedge Funds

Computer networking company, Juniper Networks, is facing pressure from the hedge fund industry to drastically reduce expenses. As a result, the Sunnydale, California-based company is cutting 6 percent of its workforce worldwide, and is considering closing some locations. The job cuts are expected to affect middle management positions.

In a regulatory filing on Monday, Juniper also stated that it would stop the development of the application delivery controller technology, which according to Reuters, helps remove excess load from servers.

One hedge fund in particular, Elliot Management Corp., has stated that Juniper’s stock was undervalued and that the computer company should focus on revamping its core business, which includes making routers and switches for mobile carriers.

 

See detailed coverage from:

Reuters

Silicon Beat

PC World