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Showing posts from May, 2011

Réal Desrochers to Head CalPERS Private Equity

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Marc Lifsher of the LA Times reports,CalPERS names new private equity investment executive:
The California Public Employees' Retirement System, the country's largest public pension fund, has named an investment executive to run its $49-billion private equity investment portfolio.Real Desrochers, who spent a decade doing a similar job for the California State Teachers' Retirement System, replaces Leon Shahinian, who resigned in August after being caught in a spreading CalPERS corruption scandal.Private equity generated annual returns of more than 17% for the teachers' fund under Desrochers' leadership in the decade before 2009, CalPERS Chief Investment Officer Joseph Dear said.Earlier in his career, Desrochers worked for Canada's largest pension fund, Caisse de Depot of Quebec. After leaving CalSTRS, he advised a number of investors, including Blackstone Capital, J.H. Whitney, Texas Pacific Group, Permira and China Renaissance Industries. He also was c…

Crushing Harvard's Mighty Endowment Fund?

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Before I get into my latest topic, I want to follow-up on my Friday comment on pensions leaping back into hedge funds. I was talking to one of the investment professionals who works at an established hedge fund that received an allocation from the $175 million SARA Fund managed by HR Strategies on behalf of the Caisse de dépôt et placement du Québec, Fondaction CSN and Fond de solidarité FTQ.

This person told me that I should be patient because this is only the beginning and if successful, emerging funds will eventually be seeded. I certainly hope emerging hedge funds in Quebec will be seeded, but remain skeptical. And I repeat: this is public money and HR Strategies should fully disclose the allocations they make to all hedge funds that receive funds in the SARA Fund, including name of funds, amount allocated to each fund, follow-on investments, and most importantly, deal terms (equity stake and fees).

Why am I harping on emerging hedge fund managers? Simple, because the ones I met ha…

All Roads Lead to Athens?

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Stephanie Levitz of the Canadian Press reports, Harper uses Greece trip to teach political lesson to his government and theirs:
Prime Minister Stephen Harper brought a message from Canadian politics to his Greek counterpart Saturday.He said that sometimes, a government needs to act even if the opposition doesn't want to co-operate.Harper arrived in Greece for his first bilateral visit as the country is being rocked by protests and political turmoil over its debt crisis and the austerity measures required to get the deficit under control.For the past year, Greece has relied on a $155 billion package of bailout loans from other EU countries and the International Monetary Fund.But the first round of austerity measures agreed to in return didn't ease market concerns that the Greek economy can be salvaged.On Friday, Greek Prime Minister George Papandreou failed to get all-party support on new measures, jeopardizing the next round of bailout funds from the European Union an…

Pensions Leap Back to Hedge Funds?

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Steve Eder, Gregory Zuckerman and Michael Corkery of the WSJ report, Pensions Leap Back to Hedge Funds:
Public pension plans are lifting hedge-fund investment, seeking to boost long-term returns despite losses suffered in some funds in the financial crisis.Also, pension officials are using the historically strong returns of hedge funds to justify a rosier future outlook for their investment returns. By generating more gains from their investments, pension funds can avoid the politically unpalatable position of having to raise more money via higher taxes or bigger contributions from employees or reducing benefits for the current or future retirees.The Fire & Police Pension Association of Colorado, which manages roughly $3.5 billion, now has 11% of its portfolio allocated to hedge funds after having no cash invested in these funds at the start of the year. "There has been some deserved criticism of hedge funds, but many hedge funds during the market downturn in 2008 d…

Boom For Canadian Private Equity?

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Pav Jordan of Reuters reports, Mood upbeat for Canada private equity conference:
A resilient Canadian economy is drawing levels of private equity investment not seen since 2008 and attracting global technology giants like Google, Groupon and Microsoft. Experts say technological innovation is blurring the traditional lines between venture capital, which typically invests in early stage technologies, and private equity, which is crossing increasingly into the sector that in Canada helped give birth to companies like Research In Motion, maker of the BlackBerry smartphone."When you have the major large-cap, technology companies in North America sitting on $500 billion in cash reserves, and with very aggressive growth plans for their own businesses, in an environment that is changing at light speed, they can't get there just by their own research and corporate development efforts, so they need to get there through acquisitions," said Steve Hnatiuk, chairman of the …

Chanos vs. China?

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Svea Herbst-Bayliss and Matthew Goldstein of Reuters report,Top hedge fund chiefs: short green tech, store gems:
Bet against solar energy, says famed short seller James Chanos. Squirrel away gems, advises bond guru Jeffrey Gundlach. Go long on discount retailer Family Dollar, counsels activist investor Bill Ackman.These and other hot -- or unusual -- ideas emerged on Wednesday from an annual conference where top hedge fund managers pitch their best investment ideas.Chanos threw cold water on alternative energy companies, saying that shares in wind turbine maker Vestas Wind Systems and solar panel maker First Solar Inc likely will fall.Arguing that alternative energy may not create the jobs politicians predict, Chanos said he would likely offend the green movement with his bets."The cost of wind is 50 percent more expensive than natural gas," Chanos said, adding that Denmark-based Vestas would be a good company to bet against or sell short.The environmental benefi…

More Spying on Elite Funds - Part 2

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A follow-up to my last comment on spying on elite funds. We begin with an article by Naked Value on Seeking Alpha, Paulson & Co.'s Biggest Buy, Biggest Sell and Top Holdings. You'll notice that unlike Dodge and Cox, Paulson & Co sold all their Pfizer shares, and initiated a new position in Hewlett-Packard Company (HPQ).

Unlike Soros, Paulson & Co is still betting big on gold, owning a significant stake in SPDR Gold Trust (GLD) and expects a continued recovery, and as such it thinks banks like Citigroup (C) will continue to benefit. The fund also owns Anadarko Petroleum Corp (APC) and Transocean Limited (RIG), which is the company Ontario Teachers' bet on and made a bundle on.

Are you confused? Don't be. You should be using the tools on the NASDAQ website to slice and dice the portfolios of these elite funds. For example, clicking on the % change in value header at the top of the fourth column will show you Paulson & Co's new holdings (click on image …

Spying on Elite Funds - Part 1

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It was a beautiful long weekend in Montreal. I tried to enjoy it as much as possible getting out of the house every chance I got. Even went out with some buddies of mine on Saturday night and came back in the wee hours of the morning. Haven't stayed up that late in a long time and of course, paid the price on Sunday as I was in a zombie state pretty much all day. One thing about turning 40, you can't party like your 20 anymore, which is something my trainer reminded me of tonight as he trained me hard and screamed "TO STAY LEAN AND MEAN, NO ALCOHOL!!!"

I promised a follow-up on a few comments I started over the last two weekends, a brief intro to secrets of elite funds and keep on dancing till the world ends. This week, we're going to delve deeper into this mysterious, secret world of elite funds as we analyze some of their recently released 13-F quarterly filings for Q1 2011. After reading this comment, and the follow-up in Part 2, you'll be in a better posit…