Blackstone backed Asia fund returns 15 per cent YTD… Indian equities boost Asian funds…

Senrigan Capital Group Ltd, the Asia event-driven hedge fund backed by Blackstone Group LP, returned 15 per cent in the first 10 months of this year, reports Bloomberg.

The USD348 million Senrigan Master Fund gained 6.4 per cent in September and 1.4 per cent in October, said people with knowledge of the matter
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Senrigan is headed for the best year since its November 2009 inception. Event-driven hedge funds globally had the worst two months in September and October since May 2012, according to an index compiled by Hedge Fund Research Inc, as US managers have been hit by the unraveling of deals involving Time Warner Inc, Sprint Corp, T-Mobile US Inc, Shire Plc and AbbVie Inc this year.

Senrigan gained in September and October from progress in the reorganization of two state-owned companies in China, which the person declined to identify. It does not own shares in Alibaba Group Holding Ltd., the e-commerce company whose 63 per cent surge since a September initial public offering has boosted fund investors’ returns in the last two months.

Senrigan is led by Nick Taylor, who oversaw more than USD1 billion for Modal Capital Partners, a Credit Suisse Group AG hedge fund that he helped set up in 1999. He went on to head Citadel LLC’s principal investments business in Asia and Europe between July and December 2008.

Senrigan is posting gains and seeing assets rebound after a losing streak from 2011 to 2013. Assets fell from more than USD1 billion in 2011 to just below USD270 million last year.

Eurekehedge reports that hedge funds are up 3.45 per cent year-to-date with roughly 18 per cent of funds boasting double digit returns for the year, half the number for the same period last year.
 
Total net asset flows for 2014 were trimmed to USD55 billion for the year as hedge funds saw their fourth consecutive month of net outflows in October, with investors redeeming USD20.3 billion over the last four months.
 
CTA/managed futures funds reported performance-based gains of USD12.3 billion for the year; their highest October year-to-date gains since 2010. North American CTAs lead with year-to-date returns at 8.04 per cent.
 
Asia ex-Japan focused funds grew their asset base by USD11.2 billion in 2014, and are up 7.44 per cent October year-to-date, outperforming the MSCI Asia ex Japan by almost 300 basis points.
 
India investing hedge funds reported their ninth consecutive month of positive returns with managers deploying long/short equities up 47.30 per cent year-to-date – outperforming the BSE Sensex by almost 16 per cent.
 
European managers continued to face headwinds, down 0.56 per cent for the month and 0.60 per cent year-to-date; though the region’s specialist distressed debt investing funds are up 12.77 per cent for the year.
 
Hedge funds registered their second consecutive month of losses in October, closing the month down another 0.27 per cent1, underperforming underlying markets as the MSCI World Index2 gained 1.15 per cent after a wild month. Concerns about global growth prospects amid a deflationary environment prompted a rise in investor risk aversion in the earlier half of October, sparking a global sell-off which drove the S&P 500 Index briefly into correction territory, with US 10-year treasury yields dipping below 2 per cent. However, the market subsequently made a sharp recovery in the latter half of the month, lifted by a positive slew of economic data including strong corporate earnings and GDP numbers. Even as the Federal Reserve officially ended its quantitative easing program this month, central banks elsewhere remain committed to tackling deflation. The ECB maintained its firm stance on an expansionary fiscal policy as growth and inflation in the region remained weak, while the Bank of Japan surprised financial markets with the magnitude of its quantitative easing, causing the yen to weaken further against the greenback.

Asia ex-Japan managers were the best performers during the month, returning 0.93 per cent as markets in Greater China advanced on hopes that Chinese authorities will soon ease monetary conditions in a bid to engineer a soft landing for the economy. On a year-to-date basis, Asia ex-Japan managers lead the table with returns of 7.44 per cent, attributing much of their gains to exposure to Indian equities, which has risen 31.62 per cent3 since the start of the year. Funds with a North American and Latin American mandate came in second and third place, delivering returns of 5.08 per cent and 3.38 per cent respectively. Japan focused funds returned 3.05 per cent while European managers came in last place at 0.60 per cent.

Credit Suisse AG said Thursday it has hired long-time Nomura Holdings Inc. hedge-fund executive Aditi Velakacharla to run a Hong Kong-based group at the bank that introduces its Asian hedge fund clients to potential investors, according to WSJ.

The Swiss bank is a major player in the Asian hedge fund industry, currently ranked as the second-largest prime broker in the region by assets under management after Goldman Sachs Group Inc, according to an annual survey by industry publication AsiaHedge. The bank’s prime-brokerage unit services roughly USD21.5 billion of Asian hedge fund assets.

Velakacharla is a well-known figure in Hong Kong hedge fund circles, previously working as the regional head of capital introductions for Lehman Brothers and later Nomura when the Japanese bank acquired Lehman’s Asian arm in 2008.

Asia has seen a flurry of new hedge fund launches this year as large overseas investors take an interest in the region’s better-performing hedge funds. At the end of the third quarter, hedge funds that bet on Asia excluding Japan were up 6.6 per cent for the year versus a 5.3 per cent gain for North American hedge funds, according to data provider Eurekahedge.

State Street Global Advisors (SSgA) is set to sell its hedge fund affiliate group SSARIS to the division's senior executives.

A spokesperson for the asset management firm confirmed that the two organizations “have decided to end their relationship” after 13 years of working together.
“This decision reflects a mutual agreement that operating independently is the best course of action for both organizations and their clients,” the spokesperson said.

According to SSARIS’ website, the Wilton, Connecticut-based firm serves as the “hedge fund and funds-of-hedge-funds investment platform for SSgA’s institutional clientele.” It also manages six hedge funds and six funds-of-hedge-funds for investors in North America, Europe, and Asia. Furthermore, SSARIS has a hedge fund advisory service for asset owners that assists with portfolio construction and hedge fund monitoring.

A regulatory filing revealed it managed USD1.4 billion as of 31 December , 2013.
SSgA joined up with SSARIS in 2001, purchasing a 60 per cent stake in the company. The parent firm revealed that the majority ownership would be sold to SSARIS’ employees.

As of September 30, 2014, State Street managed USD2.4 trillion in assets, of which USD124 billion were in alternative investments.

 

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