Posts Tagged ‘Hedge Funds’

Icahn To Return Private Investors Monies

Tuesday, March 8th, 2011

Carl Icahn is returning all outside money from his $7 billion hedge-fund firm because the activist investor doesn’t want to be responsible for losing other people’s money if there’s another financial crisis, according to a letter he sent to clients. “While we are not forecasting renewed market dislocation, this possibility cannot be dismissed,” Icahn wrote in the letter. In the letter, Mr Icahn mused that his own experience of suffering “paper losses” on investments helped him to deal with the experience of 2008, but said that, “while it may sound ‘corny’ to some, the losses that were incurred by investors in our funds in 2008 bothered me a great deal more, in many respects, than my own losses”.

The 75-year-old Mr Icahn joins a growing list of high-profile managers choosing to return capital to investors. Chris Shumway, founder of Shumway Capital Partners, last month announced that he would return cash to clients of his $8bn hedge fund. Investors had balked at the decision to step back from his role as chief investment officer in November, prompting $3bn in redemption requests.

Oaktree Capital’s distressed investment fund will also return $3bn of the $10bn it raised from investors, reflecting difficulties in finding opportunities as the economy improves.

David Ganek, founder of $3bn fund Level Global, last month said the fund would close as a “cloud of uncertainty” caused by the US government’s insider trading investigation meant the firm could not be run “in a manner meeting our high standards”.

If 3 hedge funds are returning monies…this is only leading me to suspect less monies will be traded in the markets and something is indeed about to happen in the very near future. This is worrisome and only enforces my belief that we will experience a double dip.

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Happy Anniversary to The 1 Year Bull Market!!

Tuesday, March 9th, 2010

Traders had expected some profit-taking today — even on stocks with good news — given how far the market has come in a year. Since March 9, 2009, the Dow is up 59 percent, the S&P rose 67 percent and the NASDAQ gained more than 80 percent.

The bulls have been forced to fight for every inch during the past several weeks, and this week is shaping up no differently. The S&P 500 Index (SPX) is now challenging its early January high near 1,150, while 10,600 appears to be the new 10,500 for the Dow Jones Industrial Average (DJIA). What’s more, the SPX has the added weight of its 160-month moving average overhead, a trendline that marked the index’s 2002 bottom and whose breach in October 2008 provided a clear demarcation between bull and bear markets. Additionally, the CBOE Market Volatility Index (VIX) rebounded yesterday, after sinking to within striking distance of a fresh multi-year low. The VIX was halted by resistance near the 18 level yesterday, but we could see the fear barometer spike to the 19 level and its 10-day moving average today. It appears that the bears have taken charge this morning, with futures on the Dow and SPX trading 35 points and 5.8 points below fair value, respectively.

Cisco CSCO  26.1599 has a big announcement slated for 11 a.m. ET. The networking-gear maker is expected to debut tools that will allow network-service providers to build their own high-speed networks. Cisco is taking a page out of Apple’s playbook, building hype in advance of the announcement. The company said yesterday that it’s announcement will “forever change the Internet and its impact on consumers, businesses and government.

China’s chief currency regulator reiterated the country’s commitment to U.S. Treasury’s for its foreign-exchange reserves, adding that China is not into short-term currency market speculation. He also said that it was “impossible” for gold to become a major investment channel for the country’s foreign exchange reserves.

In Europe

Greece Prime Minister George Papandreou is scheduled to meet President Barack Obama and is likely to press the U.S. to regulate hedge fund which Greece says had an important role in its debt problems. I highly doubt this will make an impact as regulating will delineate a free market concept.

Fitch issued a report about sovereign ratings in Europe in which it warned that Britain’s credit profile has deteriorated, pushing the pound to a 1-week low against the dollar.

A report by temporary-hiring firm Manpower showed that the outlook for U.S. hiring is dipping in the coming quarter, casting a shadow over hopes for a recovery in jobs.

Happy Anniversary to The 1 Year Bull Market!!

ACE

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