Now this is what I call a great Groupon deal. Forget about 50 percent off on some mediocre restaurant or a massage I’ll never wind up getting. Shares of Groupon surged another 20 percent on Wednesday and have now topped $4 a share. This means the stock is up 33 percent alone in the two trading days since Tiger Global, the long-short equity firm founded by Tiger Cub Chase Coleman, disclosed it owned 9.9 percent of the shares. The stock is also up about 50 percent from its price just several trading days prior to Tiger Global’s disclosure of its stake, presumably the period when it did a lot of buying. So far, there is no significant news out on the company.
Brevan Howard apparently loves the Big Apple again. Europe’s largest hedge fund firm is looking to hire more people in its New York office — which it all but abandoned several years ago — even though it has already brought in at least 14 people in the past few months, bringing the total to 16. The firm, founded by Alan Howard, is struggling this year, gaining less than 2 percent through mid-November. In its October report to clients, the firm said its main fund generated small gains in credit, mainly in commercial mortgage-backed securities and residential MBS, and on directional positions in European government bonds. However, it told clients these gains were more than offset by small losses in interest rate volatility trading, interest rate directional trading and to a lesser extent by small losses in commodity and foreign exchange trading.
The SPDR S&P 500 ETF and the SPDR Gold Trust were the two most popular exchange-traded funds among hedge funds in the third quarter. The former attracted the most long assets — $7.8 billion — and 100 hedge fund investors, up from 94 the previous quarter, according to Goldman Sachs. The gold ETF had nearly $7.3 billion in assets, from 120 hedge funds (up from 98 at the end of June) according to Goldman’s calculations.
UBS has given the green light to shares of Greenlight Re, upgrading its rating on the Bermuda reinsurance company controlled by Greenlight Capital’s David Einhorn to “buy” from “hold.” It also lifted its price target on the stock to $27 from $25.50. “We believe GLRE is a unique way to invest with the successful hedge fund Greenlight Capital, with other advantages such as enhanced liquidity, a tax advantage and additional leverage from insurance float,” the report states, adding that the current stock price is a good entry point since it currently trades below book value per share. The report was issued Wednesday, November 21, and the stock climbed about 2.50 percent, to nearly $23, on the news.
One of the worst performing hedge fund managers this year is Ronald Gutfleish’s Elm Ridge Capital Management, which had a little more than $2 billion in assets under management at the beginning of this year. His two funds, Elm Ridge Value Partners, L.P. and Elm Ridge Offshore Master Fund, are down about 15 percent through October after generating a return of less than 1 percent in 2011 and less than 2 percent the prior year. The value investor generally owns 30 to 50 long positions and 40 to 60 short positions, according to the U.S. Offshore Funds Directory.
The SS&C GlobeOp Forward Redemption Indicator shows an increase in November forward redemption requests from hedge funds from October levels. However, this is in line with seasonal expectations, says Bill Stone, chairman and CEO of SS&C Technologies, in a press release. The figure is calculated by taking the total number of forward redemption notices received from investors in hedge funds administered by SS&C GlobeOp on the GlobeOp platform, divided by the assets under administration at the beginning of the month for the firm’s clients. The firm points out redemptions have been generally trending down since peaking at 19.27 percent in November 2008.
