Main News

 

Yam `Not Happy' With Transparency of Hedge Funds
Bloomberg - Monday September 24, 09:49 BST

 

Bear Stearns launches risk index
US bank Bear Stearns has launched an index it claims is the first to allow investors to put money into a risk-arbitrage strategy without having to analyse and monitor specific transactions.
http://mail2.efnmail.co.uk/r/316332/MTk4MTI1OjE1MTU1/

 

HSBC to offer hedge funds to HK clients
Source: Yahoo! News
HSBC, Europe's biggest bank, will soon begin recommending select hedge funds as an alternative investment vehicle to its wealth management clients in Hong Kong. More... <http://www.hedgefund-index.com/newstoday.asp>

 

Crisis sparks CDO asset sales as contagion spreads
Source: FinancialNews-US.com
Vehicles that invest in complex mortgage-backed securities have started offloading billions of dollars in assets after the value of their portfolios fell to levels that triggered a liquidation clause. Troubles with these vehicles, known as market value collateralised debt obligations, which package together bonds and divide them into different levels of risk, is the latest sign of contagion from the US sub-prime mortgages debacle. More... <http://www.hedgefund-index.com/newsmortgagebs.asp>

 

US pension funds buy opportunity
http://www.ipe.com/realestate/US_pension_funds_buy_opportunity_25446.php

 

Hedge Funds and the Subprime Crisis: a French Answer to French Criticism European leaders, eager for an explanation absolving them of responsibility, have once again laid blame on the seemingly detrimental role played by hedge funds in this summer's crisis. This crisis is the result of a sudden fall in asset prices, combined with increased aversion to risk on the part of investors. To suggest that hedge funds are to blame for this crisis is simplistic but tempting, as their speculative, unregulated, and opaque nature make them easy targets - all the while, more delicate market and regulatory issues are avoided. More...

 

The Amaranth Collapse: What Happened and What Have We Learned Thus Far? Hilary Till. On September 18th, 2006, market participants were made aware of a large hedge fund's distress. On that date, Nick Maounis, the founder of Amaranth Advisors, LLC, had issued a letter to his investors, informing them that the fund had lost an estimated 50% of their assets month-to-date. By the end of September 2006, these losses amounted to $6.6-billion, making Amaranth's collapse the largest hedge-fund debacle to have thus far occurred. More...

 

A new study from Greenwich Associates reveals that the liquidity crunch in global credit markets sparked by the collapse of the U.S. sub-prime mortgage sector caused a nearly complete — if temporary — disruption in the trading and usage of many fixed income products. Despite the severity of the crisis to date, institutional investors fear that fallout will continue to spread.

Full Story...

 

Financial News Profile: BNY Mellon attempts to combine firepower with finesse
Nadine Chakar is adept at proving sceptics wrong. The first head of Bank of New York Mellon Asset Servicing in Europe, the Middle East and Africa, has been working in the custody industry for 19 years, predominately at Mellon. And for much of that time, she has been building businesses that many believed would fail.
http://mail2.efnmail.co.uk/r/316383/MTk4MTI1OjE1MTU1/

 

An Option-Theoretic Prepayment Model for Mortgages and Mortgage-Backed Securities
by Andrew Kalotay, Deane Yang, & Frank J. Fabozzi
We introduce a new approach for modeling the prepayments of a mortgage pool and show how it can be used to value mortgage pools and agency mortgage-backed securities. We describe the full spectrum of refinancing behavior using a notion of refinancing efficiency. Our approach has two distinguishing features: (1) our primary focus is on understanding the market value of a mortgage, in contrast with standard models that strive (often unsuccessfully) to predict future cash flows, and (2) we use two separate yield curves, one for discounting mortgage cash flows and the other for MBS cash flows... More... <http://www.hedgefund-index.com/s_mortgagebs.asp>

 

Next Test for Wall Street
New economic data may slow rally sparked by rate cut. Read More

 

Edhec sets up pension  fund research chair
http://www.ipe.com/news/Edhec_sets_up_pension_fund_research_chair_25438.php

 

Hedge funds must address critics’ concerns
Financial Times Mon, 24 Sep 2007 10:17 AM PDT
In July a hedge fund working group was established in the UK under the chairmanship of Sir Andrew Large to review industry standards and best practice in relation to valuation, risk management and disclosure.

 

Three hedge funds plan Northern Rock raid: paper
September 23, 2007 07:26 AM ET
LONDON (Reuters) - Three leading hedge funds are planning a break-up
of beleaguered British bank Northern Rock , according to a newspaper
report on Sunday.
http://links.reuters.com/r/EN8ZS/5XF5P/HV5E6/HE3FK/IL2YR/N9/t?a1=nl_usbusinessearly

 

WASHINGTON (HedgeWorld.com)—Mubadala Development Co. will purchase a 7.5% stake in the Carlyle Group for $1.35 billion in cash, according to a joint statement issued by the two firms. ......

 

BlackRock Claims Zilch Sub-Prime Exposure
Reuters - Monday September 24, 07:53 BST

 

 AP, Bloomberg, Reuters, N.Y. Post

Bond forecast Government bond trad ers, who predicted six of the last seven recessions, forecast the Federal Re serve will lower interest rates again before the end of the year. Traders have pushed the yield on Treasury two-year notes to almost...
full story: http://www.nypost.com/seven/09242007/business/business_briefs.htm

 

Bubbles leave a residue that can take years to shift -- [at FT.com]
By Tony Jackson FT.com
9/23/2007 1:51:08 PM

 

Opus
Salon.com Sat, 22 Sep 2007 6:29 PM PDT
Hedge fund managers: New American heroes!

 

From Russia With Cash: Seeding a Hedge Fund -- [at NY Times]
By RON STODGHILL New York Times
09/23/2007 01:33:06

_________________________________________________________________________

Yield Curve Corner

 

Bernanke's Big Top
Seeking Alpha - New York,NY,USA
Ben Bernanke and his merry band were again under the big top in the continuing circus that ever-more-accurately describes the US financial markets. ...
See all stories on this topic

_________________________________________________________________________

Natural Disaster Corner

 

Climate Prediction  http://www.nws.noaa.gov/predictions.php

World Meterological Organization http://severe.worldweather.org/

Tornadoes: http://www.disastercenter.com/tornado.htm

Great Sat Pictures of events: http://www.osei.noaa.gov/Events/Current/TRCjerry267_G12.jpg

_________________________________________________________________________

Iranian Situation

 

Iran's Ahmadinejad: No attack on Israel
AP via Yahoo! News Mon, 24 Sep 2007 12:07 PM PDT
Iranian President Mahmoud Ahmadinejad said Monday that Iran would not launch an attack on Israel or any other country, and he does not believe the U.S. is preparing for war against Iran.

 

IRAN:  Iran is monitoring U.S. troop movements using advanced
satellite technology, and those troops are in range of Iranian
missiles, Yahya Rahim Safavi, an adviser to Iranian Supreme Leader
Ayatollah Ali Khamenei, said in remarks published in Iran Daily.
Safavi also said he does not expect the United States to attack
Iran because the United States is too preoccupied with Iraq.

 

Same time next year?
Iran's president visits New York
Full article

 

IRAN, IRAQ:  Iran has closed key border crossings with Northern
Iraq, a senior Kurdish official said. Dana Ahmed Majeed, the
Kurdish governor of the Iraqi province of Sulimaniyah, said at
least four border gates -- in the towns of Panjwin, Haj Omran,
Halabjah and Khanaqin -- were closed, and that only one remains
open. The closures occurred four days after U.S. troops arrested an
Iranian official during a raid on a hotel in Sulimaniyah, 160 miles
northeast of Baghdad. A spokesman for the autonomous Kurdistan
Regional Government in Northern Iraq said, "We are paying the price
of what the Americans have done by arresting the Iranian."

 

Iranian President: 'We Love All Nations'
At Columbia, Ahmadinejad discusses the Holocaust, Palestinians and more.
MORE DETAILS: <http://www.wnbc.com/tu/5s6yN6rA1.html>

 

Geopolitical Diary: Iran Fright Month
http://www.stratfor.com/products/premium/read_article.php?id=295684

 

Calpers severs links with Iran
Arnold Schwarzenegger, Governor of California, is expected to sign a bill next month prohibiting the state's public pension funds from investing in companies that conduct business with Iran, which is alleged to foster state-sponsored terrorism.
http://mail2.efnmail.co.uk/r/316336/MTk4MTI1OjE1MTU1/

 

Ahmadinejad wants 15-year-olds in Iran to vote
AFP via Yahoo! News Sun, 23 Sep 2007 3:59 AM PDT
President Mahmoud Ahmadinejad on Sunday said he wanted to restore the vote in Iran to young people aged 15 and upwards less than a year after parliament raised the minimum voting age to 18.

 

_________________________________________________________________________

Opalesque’s Corner

 

- Morgan Stanley may buy 20% stake in Barton Bigg`s Traxis hedge fund; Biggs: cash from old firm?
- Opalesque Exclusive: Absolute Capital Management to appoint new CIO and a new risk manager, says it`s `operating well within its fixed-cost base and is solvent`, Absolute to allow pullouts from 3 funds,  `Partying as though he hoped to forget himself `: Homm in Zurich, Homm`s surprise resignation was 2nd time the controversial hedge fund manager has disappointed investors and prompted big withdrawals from funds
- Opalesque Exclusive: First wholly Africa dedicated hedge fund Scipion African Opportunities` A share class returns +0.98% in first month
- Citadel may start Asia-dedicated funds, Thorsby says
- New Jersey gives nod to alts investments, approves four hedge funds
- Russian multimillionaire, well-connected energy magnate starts hedge fund with $200m of own money, Yusko`s Hatteras raising $500m fund, Wessex launches Gold fund
- Did you know? GAM is going single, already $5.3bln in single-strategy business
- Property hedge funds gain while UK unit trusts and OEICS drop
- FoF Harmony Capital takes big August hit
- Investors flock to buy First Data loans
- Bear Stearns seeks stay to appeal bankruptcy ruling on Cayman funds,  At least eight London-based investors expected to join legal action against Bear Stearns
- GSA, Gradient, Atticus caught in credit carnage
- Markov Process: New analysis offering guidance as to what is going on with HFs, People valued more than past performance
- Schmidt Rating launches public hedge fund rating
- Suddenly a good bear is hard to find as stocks rise on Fed ease
- First State to profit from a music catalogue, FT update on wine, art, luxury investing, Must read:  Opalesque`s exclusive series on art investing
- Freight derivatives tracked in trading room
- Frost of Cairn Capital says CDO market revival underway, Moody`s expects to downgrade more subprime securities, HSBC pulls switch on subprime unit,  HSBC pulls switch on subprime unit,  Speech: Paulson on mortgage crisis
- Buffett, Gates, Pickens see profits in electricity, `huge market`
- Morningstar: 130/30 held up better in August than hedge funds,  Merrill 130/30 report said to be blue print to lauch 130/30 offering
- Update on PAAMCO, Pension adviser Callan cited by SEC on  incomplete disclosure of conflict of interest,  Calyon`s Fery leaves after credit trading losses, people say, SEC to `look at all the players` in subprime crisis for accounting error or insider trading
- AlternativeSoft enhances HFOptimizer software in new release
- Nasdaq to launch option exchange launch in December
- Hedge funds circle ailing Northern Rock, Three hedge funds plan Northern Rock raid, Paper says N. Rock turned down JPMorgan funding help,  Northern Rock in a hard place as 12 banks say `not interested`, Industry may face £7bn bill after Northern Rock crisis, GBP20bln needed to refinance
- Dollar peg punishes UAE residents
- Belgravia in Russian real estate push
- HSBC to offer hedge funds to `premier` HK clients
- Yam `not happy` with transparency of hedge funds
- HK regulator still studying easier short selling
- News Briefs: EDHEC sets up a research chair on Regulation and Institutional Investment,  Qatar bank to buy 40% stake in UAB, Sino-Ocean prices IPO at top to raise $1.5 billion as Asian IPO market detaches from subprime ripples
- And Finally.  Sweden: Fathers who walk brides down the aisle is sexist, imported from American and British films
- Logon: http://www.opalesque.com/main.php?act=archive

 

_________________________________________________________________________

Misc. Items of Interest

_____________________________________________________________________

Funnies, Facts, Quotes, etc….

 

panacea pan-uh-SEE-uh, noun:

A remedy for all diseases, problems, or evils; a universal medicine; a cure-all.

 

1993:  Norodom Sihanouk was crowned king of Cambodia for the second time.

1960:  The first nuclear-powered aircraft carrier, the Enterprise, was launched by the United States.

1938:  Don Budge won the U.S. Open, becoming the first player to win a grand slam title in tennis.

1934:  Babe Ruth played in his last baseball game for the New York Yankees at Yankee Stadium.

1877:  Saigo Takamori, a hero of the Meiji Restoration, was killed after reluctantly leading a rebellion against the Meiji government.

1869:  Plummeting gold prices led to a panic known as Black Friday, when U.S. President Ulysses S. Grant, after learning of an attempt by Jay Gould and James Fisk to drive up the gold market, ordered $4 million of government gold to be sold on the market.

1755:  John Marshall, the fourth chief justice of the United States and principal founder of the U.S. system of constitutional law, including the doctrine of judicial review, was born.

_________________________________________________________________________

Conference, Courses, Books, Papers

 

Great Research Sites:

 

Merrill Lynch research Link to full report including important disclosures see example

 

John Mauldin’s Weekly Analysis

 

James Altucher’s Website:

 

Other useful sites:

 

_________________________________________________________________________

Index Corner

 

The CSFB/Tremont Hedge Fund Index www.hedgeindex.com.

The Cogent Dynamic Averages http://www.cogenthedge.com/home/inv_strategy.asphttp://www.cogenthedge.com/home/inv_strategy.asp

The Dow Jones Indices: http://www.djhedgefundindexes.com/index.cfm?event=viewPremiumContent (free registration)

HFRX Indices https://www.hedgefundresearch.com/hfrx_reg/index.php?fuse=login&1170880431

_________________________________________________________________________

Regulatory Info

 

 

_________________________________________________________________________

Disclaimer

 

The information contained in this document does not constitute an offer or solicitation to sell any security or other type of vehicles to or by anyone in any jurisdictions, nor should it be regarded as a contractual document. Under no circumstances should the information provided on this document be considered as financial advice, or as a sufficient basis on which to make investment decisions. The information contained herein has been gathered by Investor DNA, LLC from sources deemed reliable as of the date of publication, but no warranty of accuracy or completeness is given. Investor DNA, LLC is not responsible for and provides no guarantee with respect to any of the information provided herein or through the use of any hypertext link. Past results are no indication of future performance. All information in this newsletter is for educational and informational purposes and does not constitute investment, legal, tax or accounting advice. All materials are the property of the respective publishers, as referenced by header and appropriate hypertext links.