AIFMD: Are You Ready? – An infographic by the team at StatPro
SS&C Technologies Holdings, Inc. (NASDAQ: SSNC), a global provider of financial services software and software-enabled services, today announced that Virtus Investment Partners (NASDAQ: VRTS) has chosen SS&C to provide middle- and back-office services for approximately $20 billion of separately managed, institutional and closed-end fund assets.
Virtus, a partnership of boutique investment managers, will use SS&C’s dedicated outsourcing services and leading technology, Global Wealth Platform™ and other related technologies to support the unique and specific requirements of its affiliated asset managers. Services include support for account opening, order design and trading, true multi-currency accounting, performance measurement and attribution and web based client reporting.
“Partnering with SS&C on middle- and back-office services will give Virtus a flexible and scalable operational platform to support our current investment management activities and our long-term growth needs,” said Frank Waltman, Executive Vice President, Product Management, at Virtus. “We chose SS&C because of their depth and breadth of expertise in this area and their ability to support our distinctive business model, which provides our affiliates access to best-in-class technology support that is customized to their specific needs.”
“Virtus has done a superb job of growing its assets and adding distinctive managers into its partnership. Having diverse, high performing managers is a recipe for success and SS&C is very pleased to be selected to deliver a comprehensive solution,” said Bill Stone, Chairman and Chief Executive Officer, SS&C Technologies. “Our investment operations services team, underpinned by world-class technology, helps asset managers execute business strategies better, faster and more predictably.”
About Virtus Investment Partners
Virtus Investment Partners (NASDAQ: VRTS), which had $57.7 billion of assets under management at December 31, 2013, is a distinctive partnership of boutique investment managers singularly committed to the long-term success of individual and institutional investors. Virtus offers access to a variety of investment styles across multiple disciplines to meet a wide array of investor needs, and provides products and services through affiliated managers and select subadvisers, each with a distinct investment style, autonomous investment process and individual brand. Its affiliated managers include Cliffwater Investments, Duff & Phelps Investment Management, Euclid Advisors, Kayne Anderson Rudnick Investment Management, Kleinwort Benson Investors International, Newfleet Asset Management, Newfound Investments, Rampart Investment Management and Zweig Advisers. Additional information can be found at www.virtus.com.
About SS&C Technologies
SS&C is a global provider of investment and financial software-enabled services and software focused exclusively on the global financial services industry. Founded in 1986, SS&C has its headquarters in Windsor, Connecticut and offices around the world. Some 6,900 financial services organizations, from the world’s largest institutions to local firms, manage and account for their investments using SS&C’s products and services. These clients in the aggregate manage over $26 trillion in assets.
Additional information about SS&C (Nasdaq:SSNC) is availa
Rothschild Asset Management, the US asset management business of the Rothschild Group, and employee-owned Larch Lane Advisors have teamed up to establish the Rothschild Larch Lane Management Company LLC.
Bringing together two experts in hedge fund investing, the joint venture company will act as the investment advisor for a multi-manager liquid alternatives 40 Act fund that will utilize a risk balanced approach to portfolio construction.
“This is a great milestone for Rothschild and an important step in developing our alternatives investment business in the US,” said Michael Tamasco, Co-Head of Rothschild Asset Management Inc. “We’re thrilled to partner with Larch Lane on this initiative, given their reputation and years of innovation in alternatives solutions.”
Rothschild brings complementary global research of liquid hedge fund managers and distribution. Larch Lane is a pioneer in early stage hedge fund investing, hedge fund seeding, and is a well-known fund of hedge funds investor in the US, the company said in a press release.
Three hedge fund managers have accorded over $1.5 million apiece to the new series, “Years of Living Dangerously” which premiered on Showtime this month. The series highlights the effects of climate change already happening around the world, such as drought and forest-fires in the US and around the world.
“The series is a collaboration with some of the biggest names in Hollywood. “Titanic” and “Avatar” director James Cameron, former United Artists head Jerry Weintraub, and actor-turned-politician Arnold Schwarzenegger are among the executive producers. Each episode features celebrity correspondents such as Matt Damon, Harrison Ford, Jessica Alba and Leslie Stahl.” CNBC reports.
The three hedge fund managers, Chris Hohn of The Children’s Investment Fund, Jeremy Grantham the founder of GMO, and Steve Mandel of Lone Pine Capital are joining the ranks of activist hedge fund managers fighting against global climate change. Tom Steyer, billionaire and founder of hedge fund Farallon Capital Management has been raising funds for his super-pac NextGen Climate Action, which he hopes will rival the conservative political groups funded by Charles and David Koch.
Where the Republicans have support from the Koch brothers and other oil industry moguls, others who have made their fortune in technology and alternative energy see a Democratic administration as a better alternative.
The Alternative Investment Management Association (AIMA), has published a new educational guide to understanding hedge fund performance, ‘Apples and apples: How to better understand hedge fund performance.’’ (PDF)
AIMA says comparing hedge fund performance to the S&P 500 can be an “apples and oranges” comparison. It proposes five steps to improve understanding of hedge fund performance:
- Look at risk-adjusted returns: The guide reveals that hedge funds consistently outperform US equities (as measured by the S&P 500), global equities (MSCI World) and global bonds (Barclays Global Aggregate ex-USD Index) on a risk-adjusted basis, a crucial measure for investors. Even during the stock-market rally of recent years, hedge funds performed better on a risk-adjusted basis than the S&P 500 and MSCI World, according to the guide.
- Look at long-term data: The guide says that short-term data such as monthly comparisons can be misleading and argues that greater clarity is gained by looking at long-term figures. It points out that hedge funds have outperformed the main standalone asset classes over the 10 years to the end of 2013 both in terms of “headline” returns and on a risk-adjusted basis.
- Look at the returns by strategy: The guide explains how hedge fund strategies are enormously diverse and have different characteristics which can play different roles in investor portfolios. It also stresses that hedge funds are not an asset class and that there is no such thing as the “average” hedge fund.
- Compare with the most relevant asset class: The guide says that reference should be made to how different strategies perform in relation to the most relevant asset class to that strategy. In other words, it may make much more sense to be comparing a particular strategy to bond performance than equities.
- Be aware of differences between hedge fund indices: The guide notes that during the five years to the end of 2013, the main hedge fund indices produced notably different results, reflecting variations in constituency and methodology.
“It is striking that recent surveys have highlighted high levels of investor satisfaction in hedge funds at a time when many commentators have claimed that the industry is being out-performed by the ‘market’. The reason for this is that investors are not allocating to hedge funds to beat the S&P 500 but to allow them to meet their asset-liability management objectives in terms of risk-adjusted returns, diversification, lower correlations, lower volatility and downside protection.” Jack Inglis, AIMA’s CEO, said. “Put simply, many investors value getting steadier returns with lower volatility over higher returns with much greater volatility. Hedge funds actually have lower volatility not only than equities but also bonds. What that means is that in terms of the risk taken, ie in risk-adjusted terms, the industry continues to out-perform.”
A member of the team that obtained admissions of liability as part of an $18 million settlement with hedge fund adviser Philip Falcone and his advisory firm Harbinger Capital Partners has been appointed as deputy chief litigation counsel in the Division of Enforcement by the SEC.
David J Gottesman said, “I am honored to have the chance to serve as deputy chief litigation counsel. I look forward to continue helping the Enforcement Division carry out its mission of protecting investors and the markets.”
This is not the same David Gottesman who is friends with Warren Buffet and a hedge fund billionaire in his own right.
Gottesman has successfully led several jury trials on behalf of the Commission, including a two-week jury trial that concluded with a finding of liability for accounting fraud against former executives of Hayes-Lemmerz, an international auto parts supplier.
He also led one of the SEC’s financial crisis cases against two former executives of Charles Schwab & Co. for misleading statements and omissions in marketing the Schwab YieldPlus Fund. The defendants’ settlements included significant civil money penalties and industry bars or suspensions.
Matthew C. Solomon, chief litigation counsel in the Enforcement Division, added, “David has a keen sense of what works with judges and juries and has distinguished himself as an advocate by winning challenging trials against top defense counsel. His trial acumen, together with his subject matter expertise and strong management experience, will be critical assets to our national litigation program.”
Receiving legal and regulatory approval, alternative investor GEMS Group has acquired hedge fund group Kenmar-Olympia.
“We are very happy to have concluded this acquisition that reinforces our research and international distribution capabilities.” Dr David Goldfarb, Managing Director of GEMS Investment Research said.
This merger launches the GEMS Kenmar-Olympia Group, which manages over $2 billion through a wide range of asset management products and services both in financial and real estate markets.
“The group offers in particular multi-strategy alternative and long only funds of funds on macro and thematic strategies; as well as a range of systematic global and sectorial single funds.” The hedge fund group said. “GEMS Kenmar-Olympia Group is also active in private banking, provides family office services and offers life insurance contracts linked to alternative and traditional vehicles.”
The GEMS Kenmar-Olympia Group has offices in London, Paris, New York, Tel-Aviv, Geneva, Nassau, Buenos Aires and Singapore. Each firm of the new Group will continue to develop its own clientele capitalizing on improved research skills as well as better operational capabilities.
The Bloomberg BNA Banking Report Advisory Board is adding hedge fund law firms and specialists to its panel of practitioners and policy experts from across the spectrum of banking law. The Advisory Board will provide guidance and feedback for Bloomberg BNA’s Banking Report and Banking Daily.
The Bloomberg BNA Banking Report Advisory Board members are:
- Alan W. Avery, Partner, Corporate Department and Financial Institutions Group, Latham & Watkins LLP
- Lynne B. Barr, Partner, Financial Institutions Group, Chair of Banking and Consumer Financial Services, Goodwin Procter LLP
- Michael E. Bleier, Partner, Financial Industry, Financial Services Regulatory and Hedge Fund Groups, Reed Smith LLP
- A. Patrick Doyle, Partner, Financial Services and Corporate Securities Groups, Arnold & Porter LLP
- Ronald R. Glancz, Partner, Chair of Financial Services Group, Venable LLP
- Alan S. Kaplinsky, Partner, Practice Leader of Consumer Financial Services Group, Ballard Spahr LLP
- Thomas F. Kaufman, Director, Member of Capital Markets Group, Goulston & Storrs PC
- Kevin L. Petrasic, Partner, Global Banking and Payments Systems Practice, Paul Hastings LLP
- Robert B. Serino, Of Counsel, BuckleySandler LLP
- Thomas P. Vartanian, Partner, Chair of Financial Institutions Practice, Dechert LLP
- Samuel R. Woodall III, Partner, General Practice Group, Sullivan & Cromwell LLP
- H. Catherine Woody, Vice President, Media and Industry Relations, Conference of State Bank Supervisors
“The market for legal and financial information is evolving rapidly and nowhere is that more apparent than in the banking sector,” said Michael Eisenstein, Bloomberg BNA vice president and group publisher, Legal & Business Publishing. “The perspectives gained from this extraordinary group of banking professionals will help us keep an edge and provide even better resources for our clients. We are proud to have them join our first Banking Report Advisory Board.”
Hedge fund FORT Management, founded in 1993 by Yves Balcer and Sanjiv Kumar, who formerly worked together as senior fund managers at the World Bank, has expanded its operations and opened an office in New York.
The hedge fund firm manages approximately $700 million in assets, FORT is an acronym for Financial Opportunities in Research in Trading.
Balcer is heading up the new office, located at 540 Madison Avenue, and is being joined by two new managing directors – Alan Marantz and Douglas McKeige – who have come on board to direct business development and assist in overall firm management.
Marantz is experienced in institutional asset management, having spent 26 years at Lehman Brothers, where he held various leadership roles including global head of Private Investment Management, global head of fixed income sales, head of Fixed Income Asia and global head of foreign exchange.
McKeige, an attorney, was formerly a managing partner with leading litigation firm Bernstein Litowitz Berger & Grossman, known for its work prosecuting securities litigation cases on behalf of institutional investors globally. During his tenure, he helped Bernstein Litowitz advise clients in evaluating and commencing securities and other investor-related claims.
Prior to coming to FORT, Messers. Marantz and McKeige worked at a discretionary macro hedge fund in New York, where they jointly directed business development efforts.
“Sanjiv and I felt that this was the right time to establish a presence in New York and we could not be happier in having Alan Marantz and Doug McKeige join our new office and help lead our business development initiatives,” Balcer said. “Alan and Doug each have strong backgrounds in asset management and investor relations that will complement our existing team. Having a New York location will allow us to have closer contact with our existing investors and create better access for prospective clients as we continue to grow FORT.”
The Massachusetts Bay Transportation Authority (MBTA) Retirement Fund is suing New York hedge fund manager Alphonse Fletcher Jr., the Boston Globe reports.
MBTA lost $25 million when Fletcher International Ltd, the master fund for the Fletcher group of hedge funds filed for Chapter 11 bankruptcy protection.
“The lawsuit, filed Monday in New York, accuses Fletcher and his firm, Fletcher Asset Management , and other parties of conducting a “long-running fraud” in which they misused money for their own benefit, inappropriately took inflated management fees, and overstated the value of assets.” The Boston Globe said. “The plaintiffs — which include the $1.6 billion MBTA fund, the Fletcher Fixed Income Alpha Fund, and three other Fletcher entities — are seeking $50 million, according to the complaint, as well as management and attorney’s fees and interest.”
According to an internal report, MBTA management is working closely with the Trustee in a collaborative effort to recover damages from both Fletcher and the potentially responsible third parties who enabled him. The MBTA’s investment portfolio achieved a 16.19% gross investment return in 2013, representing more than a $200 million investment gain.