HedgeCo Networks, LLC, a preeminent service provider to the hedge fund industry and operator of the world’s most trafficked database for hedge fund information (HedgeCo.Net), continues to attract global leaders in the alternative investment field.
Just weeks before the launch of HedgeCoVest, its new liquid alternatives platform, HedgeCo announces a new strategic investment from GEMS Kenmar-Olympia Group, a conglomeration of three of the oldest and most respected global alternative investment firms in the industry.
Over the past decade, HedgeCo has built a broad suite of services for hedge funds, including capital introduction, startup consulting, fund administration, and HedgeCoVest, a new platform for investors that replicates the portfolio and trading strategies of third party hedge fund managers directly into the investors’ brokerage accounts.
“Our new partnership with GEMS Kenmar-Olympia Group is a testament to the growth of HedgeCo over the last decade and an endorsement of the technology behind HedgeCoVest,” says Evan Rapoport, CEO HedgeCo. HedgeCoVest is designed to revolutionize the way investors allocate to fund manager strategies through its proprietary technology, the Replicazor.
Miguel Abadi, CEO of GEMS commented, “Gems Kenmar-Olympia Group is excited about the opportunity to invest in HedgeCo Networks and to be part of the continued growth of the firm.” GEMS Kenmar-Olympia Group currently manages over two billion dollars in a wide range of global asset management products and services in the capital and real estate markets.
“The GEMS-Kenmar-Olympia Group will provide global reach with international distribution efforts for HedgeCoVest via their network in Asia, Europe, the Middle East, and Central and South America,” says Evan Rapoport. GEMS Kenmar-Olympia Group is the third major equity partner to invest in HedgeCo. In 2013, Asset Alliance made an equity investment and joined Inter-Atlantic Group, who initially invested in HedgeCo in 2008.
HedgeCo manages HedgeCo.Net, the premier hedge fund database and community portal. With over 30,000 active members, and 7,000 service providers HedgeCo.Net provides a platform for hedge fund managers, investors, and service providers. Evan Rapoport founded HedgeCo in 2002. For more information, visit HedgeCoNetworks.com.
The 45th defendant charged by the SEC in its ongoing investigation into the activities of expert networks has agreed to settle the SEC’s charges. The investigation has exposed widespread insider trading by investment professionals, hedge funds, and corporate insiders for illicit profits of approximately $430 million.
The SEC filed insider trading charges against a former accounting manager at Nvidia Corp. who tipped a friend with confidential company information that set in motion a chain of tipping and illegal trading among a network of hedge fund traders who reaped approximately $16.5 million in illicit profits and avoided losses.
The SEC alleges that Chris Choi of San Jose, Calif., tipped his friend Hyung Lim with nonpublic information about Nvidia’s financial performance in advance of the technology company’s quarterly earnings announcements in 2009 and 2010. Lim relayed Choi’s information to a fellow poker player Danny Kuo, who was a hedge fund manager at Whittier Trust Company. Kuo illegally traded on the inside information for his firm and passed it along to analysts at such other firms as Diamondback Capital Management, Level Global Investors LP, and Sigma Capital Management, which is an affiliate of S.A.C. Capital Advisors LP. The analysts relayed Choi’s information to their portfolio managers who caused funds to conduct insider trading in Nvidia securities.
The SEC previously charged Choi’s tippees, including Lim as well as Kuo, Diamondback, and Level Global and Sigma Capital. The expert networks investigation arose out of the SEC’s inquiry into Galleon Management and Raj Rajaratnam – a case in which the SEC has charged an additional 35 defendants whose insider trading generated illicit profits of more than $96 million.
“Insiders at public companies who are entrusted with confidential information are duty bound to protect it,” said Sanjay Wadhwa, senior associate director of the SEC’s New York Regional Office. “Choi violated that sacred duty by regularly tipping his friend with nonpublic financial data that hedge fund traders exploited for millions of dollars in illegal profits.”
SEC Chairman Chair Mary Jo White said that hedge fund and private equity fund managers have been charging improper fees to portfolio companies or the funds they manage.
“Since the effective date of the Dodd-Frank Act, approximately 1,800 advisers to hedge funds and private equity funds have registered with the SEC for the first time.” White said at a hearing yesterday at a meeting with the U.S. House of Representatives. “Some of the common deficiencies from the examinations of these advisers that the staff has identified included: misallocating fees and expenses; charging improper fees to portfolio companies or the funds they manage; disclosing fee monitoring inadequately; and using bogus service providers to charge false fees in order to kick back part of the fee to the adviser.”
In response to Michael Lewis’s book ”Flash Boys: A Wall Street Revolt,” in which high-speed trading is postulated to leave some investors at an unfair disadvantage, White said: ”The markets are not rigged, the U.S. markets are the strongest and most reliable in the world.”
CNBC reports: “Since the book was released, the FBI, the U.S. Attorney General, New York state prosecutors and the SEC have confirmed they are investigating the practices of high-speed firms.”
“Is not unlawful insider-trading.” Mary Jo White concluded.
Hedge Connection, the premier patented hedge fund marketing platform in the alternative investment industry, will host a special charity Casino Night on the first evening of the Global Fund Forum 2014 set for June 10 to 12, 2014 at the Borgata in Atlantic City. Proceeds from Casino Night will help 100 Women in Hedge Funds, an organization that makes a difference in our industry and community with unique educational programming, professional leverage initiatives and philanthropy.
“100 Women in Hedge Funds is thrilled to be the Charity Partner of Hedge Connection’s Casino Night fundraiser. All the participants are assured of a memorable evening that will also support our organization’s growth and mission of making a difference for women in the alternative investment industry through unique education programs, peer leverage, and philanthropic initiatives,” said Amanda Pullinger, CEO of 100 Women in Hedge Funds.
Individual Casino Night tickets include hotel room, buffet dinner, cocktails and valuable insights from Featured Players Jon Finkel and Kirk Schneider, who will share their secrets on beating the odds at Blackjack. Mr. Schneider is a former managing partner of the largest Blackjack card counting team in the U.S., and Mr. Finkel is a former professional player and World Champion of Magic: The Gathering. Attendance is included for Global Fund Forum 2014 participants.
“We are delighted to open the Global Fund Forum with a special fundraiser in support of the mission of 100 Women in Hedge Funds, said Lisa Vioni, President of Hedge Connection, Inc. “In addition to an evening of networking and learning from celebrated poker and blackjack champions, Casino Night participants will also be giving back and empowering new opportunities and educational programs for women in the alternative investment industry as well as philanthropic initiatives.”
The Global Fund Forum (the “Forum”) will enable thousands of one-on-one meetings between institutional and family office investors and a diverse group of hedge fund managers. Participation is by invitation only and managers are selected based on their pedigree, strategy, assets under management, performance, track record and infrastructure. Prior to the Forum managers create a fund profile on Hedge Connection and gain access to investor profiles, and can begin to request meetings and send messages using Hedge Connection’s proprietary event scheduler. Participants can also use the Forum’s Mobile App during the event to get access to their schedule, see investor and fund profiles and read about the forum sponsors. The manager application window is open through June 1, 2014 or until all available slots are sold out. Attendance is complimentary for all qualified allocators vetted by Hedge Connection.
For enquiries about participation, qualification or sponsorship opportunities please click here.
About Hedge Connection, Inc.
Hedge Connection has been producing investor introduction events since 2005. On June 18, 2013 Hedge Connection Inc. received US Patent 8,068,478 for its unique business process of putting hedge funds and investors together online. Hedge Connection is viewed as the premier investor-intro and hedge fund marketing platform in the alternative investment industry. Over 5,000 investors have participated in Hedge Connection events resulting in thousands of direct meetings. Hedge Connection has held events in New York, San Francisco and Chicago. Hedge Connection has recently introduced the industry’s first socialized database. Through free membership in the Boardroom, industry participants can follow hedge funds in the fund database and other boardroom members offering the highest level of connectivity in the alternative industry today.
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.”