Reuters: “Stifled sentiment in Asia” as Hedge Funds boost bets against Euro

“U.S. and European stocks rallied on Friday after news that European policymakers had agreed to recapitalize the region’s ailing banks and cut borrowing costs for Italy and Spain. But stocks retreated on Monday after weak manufacturing data for the euro zone and Asia stifled sentiment.”

(Reuters) – Large hedge funds increased their bets against the euro last week as investors viewed the two-day European Union summit in Brussels with skepticism.

The funds boosted their short position against euro futures to $20 billion in the latest week from $17.9 billion in the previous week, according to an analysis in Hedge Fund Monitor, a report compiled by analysts with Bank of America.

Forbes: Weak Asia Data has Hedge Fund Investors Preparing For More Global Stress

(Forbes) Global economic fundamentals are not sound.

The U.S. economy is the shining star of the world’s major economies, and it needs Fed Reserve life support to grow over 2 percent.  The Federal Reserve Bank will extend its Operation Twist program, a bond buying program that forces interest rates to historic lows and weakens the value of the dollar.

The No. 2 economy in the world, China, continues to pump out disappointing economic data, with HSBC Flash PMI data yesterday showing lackluster business sentiment, now down to 2009 crisis levels.

Forbes: Private Equity Goes Prospecting In Emerging Markets, Asia

(Forbes) Somewhat insulated from the recession anxieties and sovereign debt default fears that gripped the developed markets, fast-growing emerging market economies from Asia to Latin America continued to beckon global private equity investors. General partners (GPs) continued to flock to healthier macroeconomic climates and booming regions like Greater China, Southeast Asia, and the Indian subcontinent seeking investment opportunities (see figure below).

SuperReturn Emerging Markets 2012 in Geneva Probes China Private Equity September 25-28

CITIC President Yibing Wu

How Will Private Equity In China Develop In Light Of The Changing Macroeconomic & Geopolitical Ecosystem?

“This conference was the best I have attended in a while. Very well represented, with discussion panels and presentations lively, to the point and relevant in the current market environment.” — Sean Glodek, Director, DARBY PRIVATE EQUITY (link)

Panel Discussion:

Moderator: Peter Cornelius, Chief Economist, ALPINVEST PARTNERS
Yibing Wu, President, CITIC PRIVATE EQUITY FUNDS MANAGEMENT
David Pierce, CEO, SQUADRON CAPITAL
Eric A. Wilcomes, Director, Portfolio Manager, DUPONT CAPITAL MANAGEMENT

Analysts says Asia, Emerging Markets Hedge Funds the ‘Biggest Loser’

(FTAdvisor) Multi-manager hedge funds’ supposed ability to make money in any market conditions has proved to be incorrect, Randal Goldsmith, analyst and sector head for S&P Capital IQ has said.

In a fund-of-hedge-funds sector report for May, Mr Goldsmith argued that the theory behind these investment vehicles, that they can generate returns in all markets, has been disproved and they actually suffer when equity markets fall.

Asia, Russia hedge fund capital surges to new record

Funds investing in Russia, India and Latin America lead 1Q gains; New allocations concentrated in Emerging Asia, Russia

CHICAGO (May 29, 2012) – Emerging Markets hedge funds posted their strongest start to a calendar year since 2006 with the HFRI Emerging Markets (Total) Index posting an industry-leading gain of +7.3 percent in 1Q12, according to the latest HFR Emerging Markets Industry Report, released today by HFR. Total capital invested in Emerging Markets hedge funds soared to a record of $127.3 billion (802 billion RMB) to end 1Q12, an increase of nearly $10 billion since year-end 2011, eclipsing the previous AUM record of $123 billion set in 2Q11. This increase in capital was driven by performance-based gains, as net new capital flows from investors remained muted, with funds experiencing inflows totaling $3.1 billion, while those experiencing outflows totaled $3.4 billion, resulting in a modest net outflow of $365 million in 1Q12. New capital flows were concentrated in Emerging Asia and Russia/Eastern Europe, which received $500 million in net new capital combined.

SOURCE:

HFR Industry Reports

 

Hedge fund adviser charged with deception regarding executives “skin in the game”

Photo:  Miami Beach.  Credit:  Wikimedia.
FROM:  U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C., May 29, 2012 – The Securities and Exchange Commission today charged a Miami-based hedge fund adviser for deceiving investors about whether its executives had personally invested in a Latin America-focused hedge fund.