Hedge Funds: The Next Shoe to Drop

You think things are bad now? Just you wait: the chart above gives you a very good indication of what Christine Williamson calls the "bloodbath ahead" in the hedge-fund industry. No one wants to be invested in an underperforming...

Sep 30 2008

Ripping Out a Hedgie

If ever wanted to know how the new Masters of the Universe live, you had a chance to take a peek inside on Friday and you get another later this month. The Greenwich, Connecticut, mansion of a former hedge fund...

Sep 08 2008

Small Foundations Get Adventurous

Craig Karmin profiles Edward Hunia, who runs the $3.8 billion Kresge Foundation. It's done well of late, thanks partly to bearish bets and an investment with John Paulson: a 16.3% total return over the past five fiscal years, and...

Sep 02 2008

How To Ask Stevie Cohen for a Job

Are you great with Excel and looking for a job? You're not alone. More than 200 hedge funds have closed so far this year, one investment bank has gone belly up, and New York's financial district has shed tens of...

Sep 02 2008

Hedge Fund Managers Not Earning Their Keep

Pity the poor hedge fund manager. 2008 has not been kind to him. According to the latest figures from Hedge Fund Research, portfolio managers had the worst returns in the first half of this year than they've had since the...

Jul 09 2008

A Second Look at Bacon's Triptych

As Figure Painting noted yesterday, Francis Bacon's Triptych 1974-77 set a record for a post-war work of art sold in Europe when it fetched $51.7 million (that price includes buyer's premium) at Christie's in London on Wednesday evening. (It is...

Feb 07 2008

Why Hedge Fund Fees Make Sense

Remember those evil hedge funds. It turns out that, overall, they did a really good job of avoiding the fallout from the credit crunch. The big reason for this, says Columbia University's Charles Calomiris, is the hedge fund fee structure:...

Aug 22 2008

Inspiring Impressionism at the High

"No art is less spontaneous than mine. What I do is the result of reflection and the study of the Old Masters." Who said it? Edgar Degas — surprising since he's grouped with the Impressionists, whose works generally depict their...

Nov 26 2007

The Million Dollar Active vs Passive Wager

Warren Buffett has a 10-year, $1 million bet with some fund-of-funds managers: he reckons that his investment in Vanguard's S&P 500 index fund will outperform their portfolio of five fund-of-funds. It's a pretty standard active vs passive bet, albeit...

Jun 09 2008

Bacon's Back

A work by Francis Bacon has surfaced for almost every major contemporary auction season in the past two years, and the upcoming February sales in London are no exception. Yesterday, Christie's announced that the artist's Triptych 1974-77, "the most important...

Jan 08 2008

Private Equity in Hedge Funds: A Weird Combination

File under "things which really don't make a whole lot of sense": Lehman Brothers aims to raise $3 billion to $5 billion for a fund to buy strategic minority stakes in hedge-fund managers, according to sources at the bank....

Jul 01 2008

Sebastian Mallaby Still Loves Hedge Funds

Every so often over the past few months, as yet another hedge fund or private-equity legend came unstuck, I wondered how Sebastian Mallaby's book was doing. After writing an astonishingly upbeat article on hedge funds for Foreign Affairs, he...

Apr 09 2008

The Death of the Hedge Fund Alpha?

The Golden Age of hedge fund returns is firmly behind us.

Apr 01 2008

Hedge Funds: The Legal Risks

Karen Donovan picks up on some interesting rhetoric from Brooklyn's very own US attorney Benton Campbell: "Hedge fund investors, like investors in publicly traded corporations or mutual funds, are protected by the federal securities laws." Hedge funds are often...

Jun 20 2008

Hotchkiss Your Money Goodbye, Groton

For some prep schools, the potential reward from hedge fund investing evidently far outweighs the risk. Last week, the Boston Business Journal ran a story on the investments by endowments at the Groton School in Groton, Mass., and Phillips Academy...

Mar 25 2008

It's Not the Fault of Hedge Fund Managers That They Make So Much Money

Andrew Clavell gets to the point on the subject of hedge-fund managers: I don't begrudge the General Partners their loot one iota. What the academics fail to understand (choose to ignore?) is that the General Partners' business model is...

Apr 04 2008

Let the Hedge Fund Lawsuits Begin

Looking for a good reason why hedge funds shouldn't market themselves to the broader investing public? Look no further. An investor in West Palm Beach, Florida is suing Citigroup Alternative Investments for defrauding investors by falsely marketing one of its...

Apr 10 2008

The Kiss (Not Klimt's)

Who could forget Rindy Sam, the Cambodian woman who planted her brightly glossed lips on a panel of Cy Twombly's pure white Phaedrus triptych at the Collection Lambert in Avignon this past summer? She claimed that is was an "act...

Dec 10 2007

Cashing in on a Caravaggio

Today "Page Six" picks up on a bit of sensation in the art world: Salander-O'Reilly Galleries is pricing a piece by Italian Old Master Caravaggio featured in an upcoming show at $100 million. Here's what Larry Salander had to say:...

Oct 03 2007

Bacon Sets at Record at Christie's London

The auction results from Christie's post-war and contemporary sale in London are in — an evening auction across the pond translates to an afternoon one on the East Coast — and Francis Bacon, robbed of the record for a contemporary...

Feb 06 2008

As Real Estate Goes, So Goes Art?

If you thought this real estate market was rocky, just wait for what's in store for your Picassos and Rothkos. The art market, which hasn't had a serious setback since 1990, is inevitably going to experience volatility when demand starts...

May 25 2007

How Google is Like a Hedge Fund

Big stand-alone hedge funds generally did well in 2007; hedge funds owned by investment banks, by contrast, did much worse. I can't help but see an analogy here: Microsoft is bringing Yahoo in-house, to compete with the big stand-alone...

Feb 01 2008

The End of the Chaos Trade

Nassim Taleb famously made his (first) fortune in the stock-market crash of 1987, and went on to an entire career based on using the derivatives market to bet on "black swan" events. Which raises the obvious question: what if...

Sep 22 2008

Just How Rich Are the Richest Hedge Fund Managers?

When it comes to the most profitable hedge fund managers in the world, there is one thing that Alpha Magazine and Trader Monthly can agree on: John Paulson of Paulson & Co. made the most last year. Aside from that,...

Apr 16 2008

A Greenwich Tale: Hedgie's Home on Auction

Michael Lauer's bad week just got worse. Not only is the former Lancer Group hedge fund manager's 7,300 square foot home headed for foreclosure auction on Friday, but also today the SEC found him liable for fraud that caused...

Sep 24 2008

Another Hedge Fund Tracker Launches

No one would ever design a mutual fund tracker, which returned a little bit less than mutual funds in aggregate. The reason is obvious: mutual funds in aggregate always underperform the market as a whole, so you'd be much better...

Jan 18 2008

Zero-Baseline Datapoint of the Day

The $9.3 billion Short Term Fund, offered as a place for schools and colleges to park their cash and get "returns slightly above U.S. Treasury bills", has now been frozen by its trustee, the stub of Wachovia which wasn't...

Oct 02 2008

Waiting for the Fall

I do wonder who the people are spending multi-million-dollar sums on bad paintings by Damien Hirst's assistants.

Aug 30 2007

AIG: The Cramer Conspiracy Theory

You knew that someone was going to come out and say it. But did you know it was going to be Cramer? Shorts were able to take AIG down from the $20s to $4 in a week's time. To...

Sep 16 2008

Fortress Gets a New Principal

Hedge funds can be extremely good at making their founders extremely wealthy. But that can be a problem, too: a star trader at a hedge fund knows that if he wants the real dynastic wealth, he'll have to start...

Aug 11 2008