Apr 3, 2008

January of 2008 was the worst month for hedged strategies since Long Term Capital Mgt. (LTCM) “blew up” in August of 1998. According to HFRI, the first quarter of 2008 was the worst quarterly return for hedge fund in six years. Equity markets globally were down sharply and volatility increased substantially. The S&P 500 is off -9.45% for the quarter, and daily swings have become more dramatic.

Morgan Stanley has bought another stake in a hedge fund firm, taking a minority ownership position in London-based Hawker Capital. Hawker, a fundamental long/short commodities shop, is the seventh stake in a hedge fund management firm that Morgan Stanley has taken in the past two years. The firm owns stakes of various sizes in Brookville Capital Management, Lansdowne Partners, Avenue Capital Management, Front Point Partners, Oxhead Capital Management and Traxis Partners.

This is how it happens - Daniel Zwirn, the hedge-fund manager who froze withdrawals on USD4 billion in assets about a month ago after investors asked to pull more than half their money out, is already talking about starting a new fund.

A group of ex-Wachovia Securities investment managers has launched a traditional fund management business with the backing of private equity firm Robert W Baird & Co and an alternative investment management company. Riverfront Investment Group will provide separate account portfolios and analysis to financial advisors and their clients, which will include high net worth investors, families and institutions. Baird will offer Riverfront distribution and product development opportunities. Riverfront will work with Private Advisors, the independent global alternative investments firm that focuses on the management of hedge fund and private equity fund of funds products.