Top Hedge Fund News Wrap – Week of 082712
Top Hedge Fund News
SEC voted in favor for proposal to lift ban on advertising and public relations for hedge funds and other investments. Now, hedge funds can compete on equal footing with other financial vehicles for the funds of high net worth individuals.
It looks like the industry could use some good PR, with the news that a mere 11% of hedge funds are beating the S&P 500 according to a widely reported Bank of America, Merrill Lynch study, with the average return at just 4.6% year-to-date, according to a Goldman Sachs. The news comes amid a steady drumbeat from the media around redemptions, centered on recent disappointing fund performance. Who would have thought we would be missing updates on the Doug Whitman case?
To be sure, the news is not all bad, with numerous articles covering the fact that the assets under management of single-manager funds rose by 5.23% in the first half of this year, to $1.892 trillion according to analytics provider, PerTrack. Apparently, the hedge fund industry continues to grow, despite the fact that numerous business reporters have seemingly removed their money from the pot.
Other Top News in Brief:
Holland & Knight agree to settle for $25 million in Arthur Nadel lawsuit. Nadel, referred to as the “mini Madoff” in the press, ran a $168 million Ponzi scheme between 2002 -2009. This settlement is an attempt by Holland & Knight to end the pain and, with perhaps with the help of some good advertising and PR, erase the memory of the lawsuit from investors’ memories.
John Paulson conference call with Band of America advisors and clients to assure them everything will be okay, after Citi withdrew $410M from his funds at the end of last week.
AMR Corp. is trying to emerge from bankruptcy protection with financing help from hedge funds.
Finally, Morgan Stanley’s hedge fund capital raiser David Barrett is leaving the firm. Barrett developed and led a new business at MS to raise money for hedge funds in 2008.