This content is from: Portfolio

The Morning Brief: Hedge Funds Fear the Taper, Survey Finds

A majority of hedge funds fear tapering, according to a new survey by hedge fund research and portfolio advisory firm Aksia. The managers surveyed expect the Treasury to begin scaling back on its purchases of debt in the next few months, and 75 percent of respondents anticipate this will have a significant negative impact on global markets. The survey also found that managers figure they need to deliver, on average, 9 percent annualized returns to keep investors happy. Also, just 1 percent of survey participants plan to take advantage of the JOBS Act and start advertising.

Hedge fund favorite MasterCard jumped 3.53 percent Wednesday after the bank-card network announced an 83 percent dividend hike, a new share repurchase program for up to $3.5 billion of common stock and a 10-for-1 stock split. Bloomberg points out that MasterCard has returned more than 1,600 percent including dividends since its May 2006 IPO. Among significant hedge fund holders are Tiger Cubs Stephen Mandel, Jr.’s Lone Pine Capital, Andreas Halvorsen’s Viking Global Investors and Chase Coleman and Feroz Dewan’s Tiger Global Management, as well as non-cub Citadel Advisors. In response to the company’s announcement, Credit Suisse raised the price target to $810 from $760.

Nelson Peltz’s Trian Fund Management disclosed it owns 5.98 percent of the shares of Allegion. The firm received the shares when the Dublin-based provider of security products and services was recently spun off from Ingersoll-Rand, another major Trian holding. The Allegion holding was disclosed in a 13-G filing, indicating the investment is passive.

Shares of Herbalife fell 4.27 percent, to close at $69.67, its lowest price since Thanksgiving. Investors apparently weren’t too impressed that the multi-level marketer won the “Choice of the Year 2013” award in the “Food Supplements” category in an annual Ukraine competition.

Duncan Hennes, a former top executive of Soros Fund Management, has been elected to Citi’s board of directors. Hennes is the co-founder and partner of Atrevida Partners, an alternative investment firm that runs the Atrevida Multi-Strategy Master Fund. Earlier in his career he was chief executive of Soros Fund Management for about a year, until he resigned in June 2000. His departure at the time was preceded by the resignation of Stanley Druckenmiller. ‘’I was brought in to do one thing, and George doesn’t want to do that anymore,’’ Hennes told the New York Times in an interview when he resigned from Soros, referring to a plan to build a larger hedge fund business.

Related Content