This content is from: Portfolio

The Morning Brief: Paulson Bullish on Housing; Einhorn Not Taking the Herbalife Pill

John Paulson is bullish on the economy and housing. Speaking Tuesday evening at New York’s 92nd Street Y forum, the billionaire hedge fund maven who famously bet against the American housing market in 2007 said housing prices are up even as supply of available homes to buy is at a decade low. This would encourage homebuilders to ramp up new construction and the "most positive change in housing since the Lehman crisis," according to CNBC. 

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Greenlight Capital’s David Einhorn put an end to speculation that he was betting against supplements supplier Herbalife. Einhorn told investors this week he has no position in the health and nutrition products company at present, FOX Business reported Wednesday. He confirmed that he shorted Herbalife last year and made a profit. Shares of Herbalife fell about 2.5 percent to $43.01 on Wednesday. However, the shares are still up nearly 34 percent this year alone. 

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On the tech stock front. Shares of Apple could drop Thursday despite beating earnings estimates. The computer giant said it missed revenue targets and well as forecasts for iPhone sales in its most recent quarter. The stock is down more than 10 percent Wednesday in after-hours trading.

On the other hand: Shares of Google, another high profile hedge fund stock, surged 5.5 percent to $741.50 on Wednesday after the company reported what some investors felt was good financial news. 

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KKR said it will acquire 24.9 percent of Nephila Capital, an investment manager specializing in reinsurance risk. The private equity giant is buying its stake from Nephila management and Man Group plc, which had acquired a 25 percent stake in Nephila in June 2008. Man will retain an 18.75 percent interest after the deal. Nephila, founded in 1997 as part of reinsurance broker Willis Ltd., specializes in investing in reinsurance risk, including insurance-linked securities,
catastrophe bonds and weather derivatives.

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Jana Partners said it will meet with investors in several Canadian cities to make a case for breaking up fertilizer company Agrium Inc., Reuters reported. It also proposed five of its own candidates for Agrium's board of directors, who will visit with the investors.

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Good news for event-Driven and merger arbitrage hedge funds. A PwC survey found that 42 percent of U.S. CEOs say they plan to complete some sort of M&A/joint ventures/strategic alliances this year. In 2012, 30 percent said they completed a domestic deal. 

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Are hedge funds redemptions easing? SS&C GlobeOp says investor redemption notifications for January are the lowest since April 2012, based on its calculations. SS&C GlobeOp’s data represents about 10 percent of the hedge fund industry.

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