Hedge fund manager, Chris Rigg, manager of the Audley Japan Opportunities Fund and a 30 year veteran of the Japanese markets, has issued a stark message about investment in Japanese bonds… The level of debt Japan is running, which by some measures is far worse than in Greece, is unsustainable. With net debt at 140% even if Japan were to run a budget where revenue and expenditure were balanced before interest costs, the economy would have to grow by 1.8% in nominal terms just to stabilise the debt/GDP ratio. The reality is that the Japanese government spends twice as much

By EJ Liotta – The past several years have brought about rapid changes to the global banking industry. The post-credit crisis world has been defined by uncertainty and put pressure on revenues and operating margins. Combined with acute regulatory demands, this has created an unprecedented set of challenges for many firms. Organisations are facing significant obstacles to generating proprietary trading revenue and are now focusing as intensely as ever on their client franchises. With its focus on hedge fund financing and service, prime finance is a major pillar of any client-centred banking organisation. Prime finance is capable of driving many

By James Williams – Prime brokers are bracing themselves for a swathe of new regulations that will place them under fresh operational and cost pressure. “The operational expense and sheer implementation cost under all this new regulation is not something prime brokers will be able to pass on easily to their clients, so I expect their profit margins will be impacted by implementing the regulatory changes over the next two years,” comments Claude Brown, prime brokerage expert at law firm Clifford Chance. These are challenging times for prime brokers. On the one hand their hedge fund clients are becoming more

Interview with Jack Seibald (pictured), Concept Capital – Last year, the majority of the USD70billion in net new inflows went to the biggest well-established managers. And despite industry assets this year climbing USD183billion to USD2.19trillion, through Q3 only USD31billion represent net inflows, suggesting that capital raising, particularly for smaller and emerging managers, remains as hard as ever. To try and improve the efficacy of fund raising for such managers, Concept Capital have this year pushed on in their capital introduction efforts, expanding the team and hosting more regular investment meetings. As the firm’s managing member, Jack Seibald, explains: “Mid-way through

Interview with Kevin LoPrimo – “We provide an institutional service to a market segment that doesn’t typically receive such a service from the bigger, top tier prime brokers,” states Kevin LoPrimo (pictured), head of hedge fund services at London-based Global Prime Partners, an award-winning boutique prime broker. That market segment, predominantly, is hedge fund start-ups and small managers. Despite global macro headwinds, from what LoPrimo has been seeing this year Europe’s start-up market is as strong as ever. Global Prime’s position is to provide the go-to platform for these managers, who maybe don’t have sufficient working capital to be able

By James Williams – What is evident among the top-tier prime brokers is the emphasis they place on helping clients and their end investors do their best work. That starts with the quality of the prime brokerage offering, the safety of their assets, the safety of the counterparty handling those assets and the alignment between the fund, its investors and its financier according to Philip Vasan (pictured), head of prime services at Credit Suisse, New York. Pricing is a secondary function of this. “We’re aiming to get those right, after which pricing becomes an outcome. Are clients actually getting what