This content is from: Portfolio

Morning Brief: Steve Cohen’s New Hedge Fund Gets Pushback

Investors are balking at long-term lockups for the manager’s closely watched fund, according to Bloomberg.

  • By Michelle Celarier

Steve Cohen’s new hedge fund, which is expected to launch early in 2018, is meeting resistance from investors, Bloomberg reports.

Cohen wants to lock up capital for one to three years, which is making investors wary, according to Bloomberg. Cohen typically invests in liquid securities, so a long lockup may seem unnecessary to investors.

The former hedge fund kingpin’s prior hedge fund firm, SAC Capital Advisors, pled guilty to insider trading in 2013, leading to a ban on Cohen’s ability to take in outside capital until 2018.

Now Cohen is coming back into the industry at a time when terms are much tougher, and it’s harder to raise money.

The fundraising targets of the new fund, Stamford Harbor Capital, also have been lowered. Cohen is now seeking to raise $3 billion to $4 billion — which is still is huge by any standard. But it’s down from initial reports that he was seeking to raise $10 billion, according to Bloomberg.

A spokesman for Cohen and Stamford Harbor declined to comment.

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The stocks of companies in the Standard & Poor’s 500 Index with the highest tax rates have become 20 percent move volatile than the overall market as the tax debate has raged in recent weeks, Two Sigma reports.

And more volatility is on the way, says Gerardo Manzo in Two Sigma’s December StreetView. “Despite the likely imminent passage of major tax reform legislation, uncertainty about U.S. social and monetary policy appears to be trending higher — not lower — with potential ramifications for future financial market volatility, employment, corporate investment, and other measures.”

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Hedge Fund Research said it is launching two new investable indexes, the HFR Blockchain Composite Index and the HFR Cryptocurrency Index, which will track the performance of hedge funds investing in the hot new area.

The HFR Blockchain Composite Index will include “funds that invest directly in blockchain technology, cryptocurrency or other emerging blockchain innovations,” HFR said in a release announcing the new indices.

The HFR Cryptocurrency Index is a substrategy index of the Blockchain Composite. HFR said it “includes all funds which invest and trade in cryptocurrency directly, typically generating performance through an actively managed portfolio of cryptocurrency assets, including Bitcoin, Ethereum, Litecoin, Ripple and many other coins, as well as new initial coin offerings (ICOs).”

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PrimeStone Capital, a London activist hedge fund firm, has taken a 5 percent stake in Tennant, a U.S. company, and Nilfisk, a Danish competitor, and wants them to merge to “create the global industry leader in the professional cleaning equipment industry,” it said in a filing with the Securities and Exchange Commission.

“A combination of the two will generate extraordinary returns for shareholders,” PrimeStone said.

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Florida-based Vintage Capital Management has taken a nearly $20 million, or 14.9 percent, stake in Babcock & Wilcox Enterprises.

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