This content is from: Portfolio

The Morning Brief: Tudor Shuts Down Flagging Managed-Futures Fund

Tudor Investment Corp. is shutting down its $120 million Tudor Tensor Fund and returning money to clients after the managed-futures fund lost money for three straight years, according to Bloomberg. Investors in the fund can put their money in a managed account that follows the same strategy, according to the report. As we have regularly chronicled, many managed futures funds and their cousins, trend followers, have lost money for the past few years. They had their best year in 2008, when they made money while most global stock markets imploded.

John Paulson is making another big bet on the mortgage market. The founder of Paulson & Co., who personally made $3.7 billion in 2007 betting against sub-prime mortgages, has bought a “significant” minority stake in mortgage company ResCap Liquidating Trust, which since December has filed lawsuits claiming $9 billion in mortgage loan losses, according to the New York Post. Paulson is hoping that, through the ResCap lawsuits, he can reap millions of dollars from lenders that sold crappy mortgages. Paulson & Co. also holds one seat on the trust’s five-member board, which is unwinding the bankrupt mortgage company. Paulson made nearly $13 billion from 2007 through 2010.

Activist hedge fund firm Barington Capital Group, which along with activist hedge fund firm Starboard Value is opposing Darden Restaurants’ spin-off of Red Lobster, has asked the restaurant company to consider ousting chief executive officer Clarence Otis, according to Bloomberg, citing a letter sent by Barington. According to the report, Barington believes Darden would be worth “substantially more” if Otis had done a better job of running the company. Barington owns about 2.8 percent of the shares.

Herbalife has launched a new website,,which makes the case the multi-level marketer of nutrition supplements helps the lives of its customers as well as its sales force. It also defends charges by William Ackman that the company is a pyramid scheme.

“An illegal pyramid scheme awards payments to participants for the simple act of signing up other participants,” the website states. “A legitimate multi-level marketing company, like Herbalife, pays compensation to participants based on the sale of product to satisfy demand by end-users.”

This is the latest development in an escalating battle between Herbalife and Ackman and his hedge fund firm Pershing Square Capital Management, which has maintained a high-profile short position in the stock for about 1.5 years. Carl Icahn, who makes it clear that he dislikes Ackman (who he claims screwed him on an earlier business deal), will soon control five of the 13 seats on Herbalife’s board of directors.

Shares of Nutrisystem jumped 2.55 percent, to $15.51, one day after New York hedge fund firm Clinton Group urged it to buy back stock or consider a leveraged buyout.

UBS began coverage of Tesla Motors with a Hold rating and a $230 target price. “While Tesla has been extremely successful to date, investors should appreciate that the downside this early in its life is material,” the bank states in its report. “The failure of a current or future product could quickly unravel all the progress. Moreover, we’d expect more luxury competitors to respond over the next few years given Tesla’s initial success.”

Actifio, which describes itself as a copy data virtualization company, announced that it received $100 million in funding, led by Tiger Global Management, with participation from current investors North Bridge, Greylock IL, Advanced Technology Ventures, Andreessen Horowitz and Technology Crossover Ventures.

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