On Tuesday a federal judge has approved SAC Capital Advisors’ $602 million settlement of insider trading charges brought by the Securities and Exchange Commission. However, the judge, District Judge Victor Marrero in Manhattan, granted approval contingent upon the outcome of Citigroup’s high-profile case in a federal appeals court. A ruling is expected soon in that case, in which a judge earlier rejected a $285 million settlement deal stemming from the banking giant’s involvement with mortgage-related securities. The sticking point in both cases is the ability of the defendants, SAC and Citi, to agree to the settlements without admitting or denying charges by the regulator. Judge Marrero wrote that it was “incongruous” for the hedge fund to admit no wrongdoing while agreeing to a huge settlement when it would cost “a fraction of that amount,” or about $1 million, to litigate.
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Third Point’s Daniel Loeb, fresh from his appearance as No. 10 on Institutional Investor’s Alpha ’s Rich List, with 2012 earnings of $380 million, sure knows a deal when he sees one. Loeb reportedly recently acquired a 200-foot yacht for between $50 million and $52 million, well below the asking price of $59.6 million. The vessel, called “April Fool,” was sold by former Citigroup CEO and chairman Sandy Weill, and boasts, among other features, a Jacuzzi on the sun deck, sauna, and a huge outdoor dining lounge.
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Caxton Associates’ key principal in Australia is leaving the firm, according to reports. Aaron Rowe, a partner and senior portfolio manager who relocated to Sydney from London in late 2010, has departed from the hedge fund firm headed by Andrew Law.
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Stephen Mandel Jr.’s Lone Pine Capital raised its stake in sports clothing maker Lululemon Athletica to more than 5.6 million shares, or 5.1 percent of the total outstanding. The stake, disclosed in a Schedule 13G filing late April 15, is passive. The Tiger Cub owned 4.83 million shares at year-end, according to a regulatory filing.
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So how long can one of the hedge fund industry’s hottest macro plays — the rising Japanese stock market — last? On Tuesday Credit Suisse Securities recommended that clients raise their exposure from a 6 percent ”Overweight” to a 16 percent “Overweight” position, saying it is “still a one- to two-year trade. “The long-term fiscal position and demographics continue to look very poor,” it warned.
