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The Morning Brief: Bridgewater’s Performance Woes; Rajaratnam’s Prison Blues

The Bridgewater All Weather Fund is down about 6 percent in June after dropping 5 percent in May, according to a report. The fund, managed by Westport, Connecticut-based Bridgewater Associates, is reportedly down 8 percent for the year. The $70 billion portfolio, managed by Raymond Dalio, began running into trouble in May when investors grew more concerned about Federal Reserve Chairman Ben Bernanke’s remarks that the agency is beginning to think about dialing down its easy money policies. The portfolio gained 14.7 percent in 2012.


Raj Rajaratnam’s insider trading conviction was upheld by a federal appeals court. Lawyers for the founder of the now-defunct New York City hedge fund firm Galleon argued in their appeal that the government improperly wiretapped Rajaratnam’s cellphone, enabling the government to record 2,200 private conversations. He is now serving an 11-year prison sentence.


Institutional investors are warming up to alternative mutual funds as substitutes for hedge funds, and more financial advisors are starting to favor them as liquid, transparent offerings in client portfolios, according to a survey conducted by Morningstar and Barron’s. The survey, which drew on responses from 235 institutions and 471 financial advisors, found that 61 percent of institutions said they accessed long-short strategies via hedge funds in 2010, compared with just 26 percent this year for the same purpose.


London-based hedge fund Odey Asset Management has cut its position in London-based hedge fund giant Man Group to 6.72 percent one month after rising stake to 7.37 percent. Shares of Man are down 40 percent since May 22.

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