Hedge Funds
This week, the Managed Funds Association (MFA) is holding its conference in Palm Springs, FL.
Recently, the SEC and CFTC issued a new form stating that hedge funds should disclose their holdings quarterly to determine which ones are "too big to fail." Richard Baker, president of the MFA, believes no oversight is needed. Believers of more regulation over hedge funds often point to the failure of Long-Term Capital Management. In this instance, the Federal Reserve instituted a "Wall Street-style" bailout of the hedge fund. To counter this, Mr. Baker stated there are no hedge funds that are systemically important as Long-Term Capital was. In addition, hedge funds use less leverage today and investors are often pension funds and endowments. The industry is more transparent as a result of these pension fund and endowment investments as investors often perform more due diligence.
Is No Hedge Fund Too Big to Fail? (click here)
At this conference, much time appears to be spent to tell managers how to "woo" future investors. The jist of the story out of the conference is managers of large pension funds or endowments often have a strategy of their own. In addition, because of their large investment, they want concessions on pricing individual investors often cannot get. To help bag the "whale," an investment from a substantial client, hedge fund managers simply need to be patient and do their homework. This includes initiating the relationship with the pension fund, knowing the size of the fund and understanding the fund's investment strategy.
For Fund Managers, a Class in Raising Money (click here)
How a Hedge Fund Can Land a Whale (click here)
Massey Energy
Massey Energy, which has faced safety problems, will sell itself to Alpha Resources. When the deal is completed, the two companies will create the largest American coal producer. Also, Massey has a strong presence in metallurgical coal, which is used in steel.
Massey Energy Is to Be Sold to Alpha Natural Resources (click here)
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