It looks like Wednesday, July 10 is the day the Securities and Exchange Commission will finally vote on the provision of the Jumpstart Our Business Startups (JOBS) Act that would permit hedge funds and other private partnerships to advertise to investors. The long delayed rule is controversial because some people — including myself — believe it will lead to more fraud by unscrupulous managers preying on individuals who qualify for hedge funds.
To address this concern, the SEC is proposing a so-called bad actor provision that would prevent felons and prior violators of securities laws from marketing hedge funds and other types of deals that fall under the JOBS Act. However, some lawyers are skeptical. “These ‘bad actor’ provisions also raise a number of issues concerning both the scope and implementation of the new disqualification sections,” wrote law firm McGuireWoods LLP in a client letter dated July 5.
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Several of John Paulson’s hedge funds lost money in June. Paulson Credit Opportunities fell 3.7 percent, trimming its gain for the year to 12 percent. The Paulson Partners fund dropped 0.5 percent in June, bringing its gains to the year to 8 percent, while Paulson Partners Enhanced, a leveraged version of the same fund, fell 1.2 percent in June and is now up 16 percent for the first six months.
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BlueCrest Capital Management’s BlueTrend fund lost 16.9 percent between May 17 and June 28. The computer-driven fund is a feeder fund which closely replicates the performance of BlueTrend’s flagship fund, headed by Leda Braga, according to Reuters.
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David Harding’s Winton Futures fund, another computer-driven London-based hedge fund, lost 1.77 in June and is up 4.5 percent for the year, according to sources.
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Louis Bacon’s Moore Capital Management has hired Morgan Stanley credit trader Anthony Wainer. He was head of high-yield credit trading for Europe, the Middle East and Africa at the investment bank.
