Strategic Risk Management, the Monaco-based hedge fund manager headed by Jon Wood that spun out of UBS two years ago, has reportedly seen its SRM G
Strategic Risk Management, the Monaco-based hedge fund manager headed by Jon Wood that spun out of UBS two years ago, has reportedly seen its SRM Global Fund lose 85 per cent of its value by the end of July.
However, the capital remains tied up by strict lock-up provisions preventing investors withdrawing their money for at least another year. The beleaguered fund has suffered big losses by investing in companies including Northern Rock, Bear Stearns, Countrywide Financial and Cheniere Energy.
The firm, which attracted USD3bn when it launched the SRM Global Fund in September 2006, is among a growing list of big-name managers that have recently recorded losses. Ospraie Management’s Ospraie Fund, Pequot’s Pequot Global Fund and Polar Capital’s Paragon Global Opportunities Fund have reportedly booked substantial losses. The HFRX hedge fund index lost 2.82 per cent in July and is down by 1.59 per cent so far this month.
Philadelphia Alternative Asset Management and its founder Paul Eustace have been ordered to pay nearly USD300m after being accused of defrauding clients by the US commodities regulator. Eustace agreed to pay USD279m in restitution and a USD12m fine, while PAAM must pay a USD8.8m fine and may be required to pay USD276m in restitution if Eustace doesn’t.
Regulators shut down PAAM and froze its assets in 2005, accusing Eustace of hiding losses and misleading investors about its funds’ assets. He covered up some USD200m in losses and misappropriated assets from two commodity pools, the Commodity Futures Trading Commission alleged. Regulators froze about USD70m when filing the case and a receiver for the fund later recovered USD96m more, but they do not expect to return significantly more to investors. Eustace still faces two criminal counts of commodities fraud in a Philadelphia court.
Greenwich, Connecticut start-up Duff Capital Advisors has hired Andrew Wilder as its finance chief. Wilder was previously worked co-founder and head of operations at North Sound Capital, having earlier worked for C. Blair Asset Management and Deloitte & Touche.
Mike Khorrami has joined Duff Capital as a managing director in its sourcing group from Millennium Advisors. He has also worked at Brevan Howard, Tiger Management, Credit Suisse and Omega Advisors. Joining as compliance chief is Charles Lerner, most recently of UBS-owned Dillon Read Capital Management.
Laura Flynn, who becomes a managing director in the client advisory group, comes from Lehman Brothers, where she was a vice president. Maria Berenguer has become a managing director in the global investment solutions group, which provides customised solutions. She was most recently at AIG Investments. Phil Duff, previously chairman and chief executive of FrontPoint Partners, launched Duff Capital in March.
The pension scheme of aircraft manufacturer Boeing has appointed Scott Hamp as director of hedge funds, overseeing the 6 per cent target allocation to hedge funds in the company’s USD50.4bn defined-benefit plan. Officials expect to reach the target in a couple of years. Hamp was previously senior director of international equity at the USD29.7bn National Railroad Retirement Investment Trust Fund.
London’s Brevan Howard has overtaken Man Group’s AHL Strategy as the largest hedge fund manager in Europe. Brevan Howard, which specialises in global macro fixed-income investments, now manages USD26.3bn. AHL was 2007’s top manager but is now in second place with assets of USD25.5bn, while GLG remain third after its assets rose 27.4 per cent to USD23.7bn.
