• Key market indices
    • S&P 500: 3,932.59 (-0.057%)
    • DJIA: 31,522.75 (+0.20%)
    • HSI: 30,746.66 (+1.90%)
    • STI: 2,935.34 (+0.13%)
    • Gold Spot $/Oz: $1,801.8 (-24.10)
    • Brent Crude: 63.46+0.11 (+0.17%)
    • Bitcoin: 49,091.71 (+2.16%)
  • Redhedge taps into credit market dislocations with new relative value UCITS hedge fund (Link)
    • The Redhedge Relative Value UCITS strategy fuses quantitative and qualitative investment processes, and aims to offer returns decorrelated from broader financial markets.
    • CEO of Redhedge, Seminara said the fund will offer institutional investors that cannot invest in non-UCITS, access to a market-neutral, low-volatility and risk-averse product.
    • "We look to achieve steady returns, with low volatility, that are uncorrelated to wider market movements. We take advantage of fair value dislocations in the bond market to form pair trades that are hedges of each other"
    • “The current low-rate environment has led to high cash balances and created a major challenge to invest in non-negative yielding assets, especially in credit markets. Our investment product addresses this issue.”
    • The fund's returns reached 1.3 per cent in January, having gained 3.38 per cent last year. The new UCITS launch replicates the fundamental strategy and investment approach of Redhedge ICAV, which launched in 2015, albeit in a UCITS-compliant framework with greater liquidity.
  • Sculptor Hedge Fund Hit Sixth Straight Year of Outflows in 2020 (Link)
    • Sculptor Master Fund lowered its AUM by $464 million, after the last withdrawal of $92 million in Q4 2020. Over the past six years, clients have pulled about $30 billion from those products.
    • Sculptor was founded in 1994 by billionaire Daniel Och. The outflows began after it was disclosed that it was the target of a bribery probe into its business in Africa in late 2014.
    • Robert Shafir (CEO) said he expects the multi-strategy hedge funds will soon begin to reverse the client departures. “Closing out the legacy issues opened up a lot of new conversations” referring to a $138 million settlement from African unit.
    • The Master Fund posted its best return in more than a decade, up 20%, raised a $2.6 billion real estate fund and strengthened its balance sheet to the strongest it has been since 2007.
    • AUM now stand at $36.4 billion, including $15.7 billion of collateralized loan obligations, with $10.5 billion in multi-strategy funds -- Sculptor’s highest-fee product.
  • Hedge Fund Anson Goes Big on Retail Trades, Outperforming Peers (link)
    • That is what pushed Anson to trade on themes and stocks popular with individual investors last year. The approach drove gains to a 44% last year, bringing total AUM to C$1.2 billion ($944 million). The benchmark's returns were 6.2%.
    • “People have to understand stocks don’t really move on fundamentals in the short term, rather they move on the sentiment,” Anson's CIO Moez Kassam.
    • Anson’s year-end letter to investors said it was able to spot the emergence of retail trends in 2020 and strategize around them, contributing to the fund’s performance. As well as investments in SPAC.
    • Anson’s strategy of shorting companies was less successful in 2020. The fund has downsized its short positions, but says it remains ready for opportunities.
    • “The same dynamics that are presently driving valuations to record levels are setting the stage for an eventual correction that will once again make a short strategy profitable,” Kassam said.
  • Activist Jeff Ubben to Seek Up to $8 Billion For Impact Fund (Link)
    • The new offering would focus on so-called impact investing, which aims to make systemic changes at companies and sectors to the betterment of society.
    • The Spring Fund II would be a successor to the $1.5 billion Spring Fund that Ubben started at ValueAct Capital Management in 2000.
    • Ubben launched Inclusive Capital after leaving ValueAct in June. While at ValueAct, Ubben agitated for changes at high-profile companies while at the new firm looks at electric-truck company Nikola Corp., power generator AES Corp. and bioenergy firm Enviva Partners among its investments.
  • Swiss Wealth Tax Rakes in Cash as Covid Stokes Global Debate (link)
    • The measure forces residents to tally the value of their investments, then a percentage is then skimmed off by cantonal governments. Switzerland can make a claim that it has the most effective one.
    • With the Covid-19 fallout causing government debt to swell, and hurting poorer people most, wealth taxes are being debated as a tool both to pay down debt and address inequality.
    • Criticisms range from the view that it’s wrong to target assets accumulated through income that is already taxed, to more practical questions of how to fairly operate such a levy. The Swiss don’t seem to be very bothered by all of that.
    • Switzerland derives a bigger share of total tax revenue from the levy than any other industrialized country. That’s not to say its effectiveness is unimpeachable, a cut in Lucerne was followed by a rise in declared assets, hinting at prior evasion.
  • Amundi launches emerging markets green bond fund (link)
    • The fund will invest in hard currency corporate green bonds, as well as sovereign bonds of select emerging markets. It seeks to take advantage of the growth in green bonds, which saw a record $52bn of issuance in 2019, with total issuances reaching $240bn.
    • The open-ended fund is managed by Amundi's Emerging Markets team, who have experience in emerging markets debt, FX and ESG, on behalf of the world's largest investors.
    • The lead PM, Maxime Vydrine, said "The strategy is an actively managed solution, benefiting from the Emerging Markets Credit Research and ESG Analysis teams' comprehensive issuer-level analysis"

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