Pension Pulse

Stephen Gandel of Fortune reports, Why the world's biggest hedge fund missed big in 2012 : Here's what needs to be asked about giant hedge fund Bridgewater Associates and its founder Ray Dalio: Is this guy really worth $2 billion a year? That's roughly the amount investors paid his firm in management fees in 2012. That question got a lot tougher in the past 12 months for pension fund managers around the country, who for the past decade and a half have been funneling cash to Dalio and his firm, which now manages $142 billion - making it the largest hedge fund in the U.S. That's because Dalio had a lousy 2012. By some reports, he was down for most of the year. Blog ZeroHedge appears to have a copy of Bridgewater's most recent client letter , which details how it did in 2012. Dalio's flagship hedge fund, Pure Alpha, ended the year up just 0.8% . That was much worse than the market in 2012. Stocks, as measured by the S&P 500, were up 13%. Bonds w...

Sam Jones of the FT reports, New hedge fund bucks trend with fees cut : One of the UK’s fastest-growing hedge funds is slashing its fees, in a move that it hopes will spark a rethink of the industry’s notoriously high charges. The new Core Macro fund being set up by Cambridge-based Cantab Capital will employ similar trading strategies as funds from Man Group, Winton Capital and BlueCrest, three of the world’s biggest hedge funds that manage $100bn between them, but at half the cost to investors. While the industry standard is an eye-watering “two and 20”, or 2 per cent of all capital invested annually and 20 per cent of all profits, Cantab’s new fund levies only 0.5 per cent and 10 per cent. Fees are set to become one of the hedge fund industry’s biggest areas of change as large institutional investors try to use their clout to force discounts in a tough trading environment that has dented hedge funds’ once-high returns. “We are seeing a substantial increase in institution...

Adam Shell of USA Today reports, Why does this bull market get no respect? : The current bull market on Wall Street has one thing in common with late comedian Rodney Dangerfield: It don't get no respect! Numbers don't lie. The Standard and Poor's 500, an index of large-company U.S. stocks, eked out a fresh five-year high Thursday at 1480.94. It is up 119% since the bull market began on March 9, 2009, which means it is a member of the so-called "100% Gain Club," and just one of nine bull markets in the benchmark index's history to post a triple-digit gain, according to Bespoke Investment Group. The current bull, which followed the worst bear market, or market plunge, since the Great Depression, is also 1,407 days old, which ranks eighth and also puts it in the "1,000 Day Club." In cash terms, the stock market has generated $10.5 trillion in paper wealth since the bear market ended, according to Wilshire Associates. So why is this histor...

Glenda Korporaal of the Australian reports, Canadian pension funds plan investment splurge : Canada's $120 billion Ontario Teachers' Pension Plan is looking at stepping up its investments in Australia with a minimum project target of $250 million. Its interest comes as US and other Canadian pension funds have been increasing their investments in Australian property and infrastructure assets, with growing interest in potential privatisations of state-owned assets. In an exclusive interview with The Australian, the Ontario fund's senior vice-president in charge of global infrastructure, Stephen Dowd, said Australia was a "really great market to invest in". "We are a global investor and we look to numerous markets across the world, but we do find Australia is one of the attractive ones that we want to pay attention to," Mr Dowd said. "Australia is open to foreign direct investment. There is a well-established regulatory regime, a very open...

Jeff Bounds of the Dallas Business journal reports, Expert sees robust private equity environment in 2013 : As you will learn in tomorrow’s paper, the fourth quarter of 2012 was a good time for private equity investing in the Dallas-Fort Worth area. My big question is, what will 2013 look like? For answers, I chatted with Jay Turner, a principal in the Dallas office of Dos Rios Partners, a private equity firm in formation with locations in Houston and Austin. Things are shaping up to be “very attractive for a robust deal environment in the next 12 to 24 months,” Turner said. He argues that three factors are combining to push up private equity activity. For one thing, l ow interest rates make debt financing inexpensive , Turner said. “This is a good time to deploy and borrow capital.” There is also pent-up demand from Baby Boomers who need to cash in at least some of their chips on the businesses they own , Turner said. Many people from that generation delayed selling...

Earlier this week, Jeff Cox of CNBC wrote an interesting article, First Shots Are Fired in Global 'Currency War' : Faced with a stubbornly slow and uneven global economic recovery, more countries are likely to resort to cutting the value of their currencies in order to gain a competitive edge. Japan has set the stage for a potential global currency war, announcing plans to create money and buy bonds as the government of Prime Minister Shinzo Abe looks to stimulate the moribund growth pace. (Read More: Japan PM Says BOJ Must Set 2% Medium-Term Inflation Goal ) Economists in turn are expecting others to follow that lead, setting off a battle that would benefit those that get out of the gate quickest but likely hamper the nascent global recovery and the relatively robust stock market. While respective countries would have their own versions, the moves would follow three years of aggressive bond buying from the Federal Reserve as part of its $3 trillion quantitative easi...