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Equity Market Neutral Related News
 in chronological order

 See also: Equity Market Neutral Related Books, Equity Market Neutral Related Scholarly Papers, or Equity Market Neutral Home Page.

Table of Contents:
 

New Marshall Wace Market-Neutral Fund Tops In ‘08

March 10, 2006
From FINalternatives:
 Marshall Wace has raised some €2 billion (US$3.1 billion) for a market-neutral version of its popular Tops hedge fund strategy.

To date, the global market-neutral strategy is the largest hedge fund launch of the year, according to the Financial Times. The firm is also reportedly prepping further versions of its Tops strategy, including a short-bias fund.

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Sprott Makes Market Neutral Offering

March 3, 2006
From FINalternatives:
 Toronto-based Sprott Asset Management last month launched a new hedge fund aimed at Canadian investors. Sprott’s Global Market Neutral Fund, a long/short equity vehicle designed as an open-ended mutual fund trust, launched with C$15 million (US$15.2 million).

Global Market Neutral employs a global quantitative strategy, investing in companies with market capitalizations of at least US$1 billion, according to fund documents. Its portfolio will be diversified by both sector and geography.

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CEC Preps Market Neutral Strategy, Halts Ocean Program

October 18, 2006
From FINalternatives:
 CEC Capital has a new Goal in mind.

The Stuart, Fla.-based commodity trading advisor is gearing up to launch a market neutral strategy with the help of an industry veteran after putting the brakes on its two-and-a-half year old Ocean program.

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Credit Suisse launches HS Market Neutral Index

October 15, 2006
From MoneyMarketing:
 Credit Suisse has announced the launch of its global HS Market Neutral Index, the latest in the HOLTSelect series.

Credit Suisse says the index offers investors the opportunity to invest in a rules-based market neutral strategy with low correlation to other asset classes and market risk is reduced by ensuring both sector and region neutrality.

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Eight Truly Market-Neutral Funds

September 18, 2006
From TheStreet.com:
 The recent one-two punch of the credit crunch and last month's negative jobs report has noticeably raised the decibel level of the bear market talk.

But with spirited rallies interrupting attempts by the ursiforms to establish dominance of the stock market, it's hard for an investor to know what to do. A strategy with exposure to equities but with potential immunity to downturns would seem to make sense.

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Market-Neutral Funds: Three Misconceptions

September 12, 2006
From SeekingAlpha:
 Alpha Male has been getting a lot of media inquiries recently about why market neutral funds lost money last month. It’s almost as if some of the more skeptical members of the press now smell blood in the hedge fund water. They see that there were market gyrations in August and that some market neutral funds were down. Ergo, market neutral funds aren’t that “neutral” after all.

In fairness, it’s easy for some to reach this erroneous conclusion. Through a grand game of “broken telephone” involving the industry and the popular press, the impression has been established that market neutral funds must have a low volatility, won’t move in the same direction as the markets, and will act as a hedge against market drawdowns.

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JP Morgan re-opens Highbridge venture

September 10, 2006
From Reuters UK:
 JP Morgan Asset Management (JPMAM) has re-opened its JPM Highbridge Statistical Market Neutral fund after assets fell by over 1 billion pounds in the recent market volatility.

The Luxembourg-domiciled fund, which has been backed by leading fund of funds managers, launched in November 2006 and is a joint venture between JPMAM and US global asset management firm Highbridge Capital Management.

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Barclays to Terminate European Market-Neutral Fund (Update1)

September 4, 2006
From Bloomberg:
 Barclays Global Investors, the fund unit of the U.K.'s third-biggest bank Barclays Plc, is closing its European market-neutral fund for administrative reasons.

The Dublin-registered fund, which had about 17.1 million euros ($23.2 million) at the end of July, has been wound up and a similar fund has now been set up based in the Cayman Islands, said Mike O'Brien, who is in charge of selling to institutions at BGI. The changes for the fund, which took bets on rising and falling European stocks, had nothing to do with recent volatility in stock markets, he said.

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Staying The Course Amidst This Relative Valuation Reversal

July 24, 2006
From SeekingAlpha:
 The quant fund liquidations of the last couple weeks distorted relative valuations. Overvalued, shorted stocks were bid up due to short covering, and cheap stocks were oversold due to aggressive selling. Now, the performance is reversing, and quant long/short funds are seeing big gains, which might continue as they retrace their losses and if no more panic trading occurs.

Looking at how market neutral funds performed speaks volumes on how, in the near term and during a crisis, correlations can increase and solid strategies can fall apart. For a quick primer of these strategies, realize that market neutral funds have minimal market correlation, so they earn their returns from the performance spread between their longs and short positions. Say, for example, a fund expects to earn a 4% annual long/short spread. Add to that an interest rate from the short sale proceeds of T-bills less some haircut, call it 4%, and the total return expectations of the strategy are about 8%. The risk, or annual variability of the long/short spread might be around 6%, and interest rates have their own volatility, so all in the expected risk for the strategy might be around an 8% standard deviation.

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An each-way FTSE bet looks relatively attractive

July 17, 2006
From Telegraph.co.uk:
 Something interesting has happened in the UK stock market over the past three months, one of those watersheds that look obvious in hindsight. Pay attention at the back because this could be your "If only I'd seen it then" moment.

What has happened is that between April 16 this year and yesterday lunchtime the FTSE 100 index rose from 6,516 to 6,713 while the FTSE 250 fell from 12,016 to 11,900. The blue-chips rose by 3pc while the mid-caps fell by 1pc.

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Old Mutual Global Equity Market Neutral Fund wins HFR Award

July 12, 2006
From Easier Finance:
 Old Mutual Asset Managers (UK) (‘OMAM’) announces that the Old Mutual Global Equity Market Neutral Fund (USD) was awarded first place in the Best Equity Market Neutral Hedge Fund on a Risk-adjusted Basis category in the 2007 HFR European Performance Awards.

The Old Mutual GEM Plus Fund was also shortlisted in the same category.

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JP Morgan US fund has cash plus 4% target

July 3, 2006
From Citywire:
 JP Morgan has launched a US-focused market neutral fund with a return target of US one month Libor plus 4%.

The JP Morgan Investment funds - US Market Neutral Sicav, which launched on 14 June, is a sub-fund in the firm’s Luxembourg-domiciled umbrella and has UK distributor status.

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Investing: Absolute-return funds: Are they worth the trouble?

June 29, 2006
From The International Herald Tribune:
 Rube Goldberg was a cartoonist renowned for designing comical and ostentatiously complex machines for accomplishing simple tasks. Flipping a switch might set off a chain of 30 mechanical operations that result in an egg's being dropped into a pot of boiling water across the room.

Goldberg is not known to have moonlighted as a manager of absolute-return funds, but providers of these products seem to have drawn inspiration from him. The funds employ complicated and expensive asset allocation procedures with the aim of generating returns greater than those available on cash deposits in all market conditions.

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Cannon Fires Up Second Market Neutral Fund

June 18, 2006
From FINalternatives:
 Two months after making his first hedge fund offering, Rusty Cannon is back with a market-neutral offering dubbed the RKC Matador Market Neutral Fund. The fund launched on June 1 with $1 million.

RKC’s new offering follows the same strategy for picking long stocks as its predecessor long/short fund, but couples each long position with a corresponding short position in the sector exchange-traded fund, according to principle Rusty Cannon. “We’re trying to garner the alpha perfomance of those long stocks over and above those sectors and it’s diversified across all sectors across the markets,” said Cannon.

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Ten Asset Adds 130/30 To Product Line

June 13, 2006
From FINalternatives:
 Quantitative shop Ten Asset Management recently introduced a 130/30 strategy to its mix of equities products. The strategy, which has been trading since January, is up 11.5% through May.

John Flynn, a consultant for the firm, said the 130/30 offering is a natural extension of the firm expertise. “Our team has been managing U.S. market neutral strategies for the past nine years and we’ve got a quantitative approach, so running 130/30 strategy is easy for us,” he said.

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JPM soft-closes Highbridge fund

June 8, 2006
From Citywire:
 JP Morgan has closed the JPM Highbridge Statistical Market Neutral fund to new investors after assets under management surged to $8.7 billion (£4.36 billion) within six months of launch.

The Luxembourg-domiciled Ucits III Sicav has proved a favourite among fund of funds managers.

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The Do-It-Yourself Market-Neutral Portfolio

June 4, 2006
From SeekingAlpha:
 The hedge fund business has been growing rapidly in recent years—with no end in sight. Wealthy investors are seeking alternative investments to meet their needs and hedge fund managers have an array of tools and strategies at their disposal. One of the core strategies employed by hedge funds is what is called market-neutral investing. A market-neutral portfolio is designed to deliver returns that are not impacted by the movements of the broader market. This does not mean that a market-neutral approach is low risk, however. Goldman Sachs' (GS) largest hedge fund employs market-neutral strategies and has attributed their very poor recent performance partly to this approach.

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Hedge Funds 101 : Understanding Current Concepts And Lingo

April 24, 2006
From Best Syndication:
 What exactly is a "hedge fund " ?

In essence , it is a managed pool of capital for institutions or wealthy individual investors that employes one of various trading strategies in equities, bonds or derivatives , attemting to gain from market inefficiencies and , to some extent hege underlying risks.

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Shield Plus Pushes Alternative Energy & Inflation Fund

April 19, 2006
From FINalternatives:
 Shield Plus, a Minneapolis-based CTA and CPO, is revving up its marketing effort for its three-year old energy and inflation hedge fund.Shield Plus 90-Alternative Energy & Inflation Fund, a market-neutral vehicle investing in the alternative energy and inflation-related markets with some $5.5 million in assets.

According to Shield founder Jim Mahnke, the fund is a net-long volatility play on options, concentrated primarily in the energy complex such as crude oil, natural gas, ethanol and other renewable energy sources including gold and corn. It employs a bottom up market-neutral investment process in an attempt to capitalize on a net change in volatility, and does not seek to anticipate market direction.

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Funds to help get a foot in the door

June 21, 2006
From International Herald Tribune:
 Hedge fund returns have slipped, so it may be just as well that gaining entry into them is difficult. Minimum investments can be more than $1 million, and sometimes all the money in the world is not enough because the effectiveness of many strategies erodes with too much use, and many funds, often the best performers, turn new investors away.

"It's tougher to sift through and pick the better managers," said Andrew Craighead, chief investment officer for J.P. Morgan's alternative-investment group. "The ones with long histories, the disciplined ones, either have closed or plan to close as they gather more assets."

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Strongest quarter for hedge funds in 3 yrs.

June 21, 2006
From InvestmentNews.com:
 Solid market performance from hedge funds earlier this year brought more investors into the fold, leading to a stellar performance by the funds in the second quarter, according to report by Chicago-based Hedge Fund Research Inc.

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US Hedge Funds strong in 2006 despite May pullback

June 20, 2006
From Finfacts Ireland:
 The Market Neutral Group yielded +0.35% in May (6.08% YTD). Convertible arbitrage managers, which returned 1.55%, continue to have an exceptional 2006 helped mainly through gamma trading activities. In the distressed space, managers were, for the most part, able to avoid widespread market carnage through selected defaulted issuers such as Northwest Airlines, Delphi, Owens Corning and Calpine. Meanwhile, credit spreads and capital market conditions were only slightly impacted by the equity market declines, leaving the new deal pipeline in vigorous condition. The Greenwich-Van Global Market Neutral Arbitrage, Event Driven and Equity Market Neutral Indices returned +0.80%, +0.34% and ‑0.78% in May, respectively.

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AIMA releases the first of its hedge-fund strategy papers

June 19, 2006
From Morningstar:
 The Canadian chapter of the Alternative Investment Management Association (AIMA) last week released the first of what will be an ongoing series of strategy papers designed for investors.

The inaugural topic, Equity Market-Neutral Strategy, proved very timely because its release coincided with a global stock-market plunge. The lead author of the paper is Chris Guthrie, president and CEO of Hillsdale Investment Management Inc. in Toronto.

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RBC's Alternative Assets Group Launches Broadly Diversified Investable Hedge Fund Index

March 13, 2006
From PR Newswire:
 RBC's Alternative Assets Group, a leading provider of structured product solutions for hedge fund investors, and a business unit of RBC Capital Markets, today announced the launch of the RBC Hedge 250 Index(TM), a broadly-diversified and representative investable hedge fund index.

The RBC Hedge 250 Index is comprised of 250 individual funds - which is up to six times greater than the number of funds referenced by other investable indices. Funds represented in the new RBC index capture approximately 20 per cent of total hedge fund assets under management, including many funds that are closed to new investors, have longer lock-up provisions or have recently launched operations.

"We have capitalized on RBC's significant experience and relationships in the industry to create the RBC Hedge 250 Index which we believe to be the most
representative investable hedge fund index in the market," said Winson Ho, co-head of the Alternative Assets Group and co-creator of the index. "There has been a great need in the market for an investable hedge fund index which does a better job of representing the performance of the asset class."

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SciVest Broadens Strategy Offering With Five New Funds Including Canada's First and Only 100% Oil Sands Pure Play Open-Ended Fund

March 2, 2006
From CNW Group:
SciVest Alternative Strategies Inc. ("SciVest"), a manufacturer and distributor of innovative alternative investment products, is pleased to announce that it is broadening its strategy offering with the launch of five new funds, aimed at meeting increasing investor demand for a more extensive mix of risk-managed products.

The new funds: SciVest Oil Sands Index PLUS Fund, SciVest Income Portfolio PLUS Fund, SciVest Commodity Index PLUS Fund, SciVest Asia Pacific Long-Short Equity Fund and SciVest Aggressive Market Neutral Equity Fund seek to provide investors with choice and flexibility to manage the risk characteristics of their portfolio, minimize volatility and market risk, and potentially enhance portfolio returns.

"Essentially, we are realigning our Market Neutral franchise of funds, expanding our Beta-Controlled franchise of funds, and introducing our PLUS franchise of funds," says Dr. John J. Schmitz, President and CEO of SciVest Capital Management Inc. "Although Market Neutral will remain a core strategy, we believe that Beta Controlled funds are a useful investment tool in the current market environment allowing investors to run with either the bulls or bears in a risk controlled manner."

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Retail hedge funds likely to appear on Irish market in medium-term

February 28, 2006
From Finance-Magazine.com:
 Ireland looks likely to follow the lead set by Germany and the UK by offering retail investors the chance to buy into hedge funds for the first time.

Leading figures in the Irish investment management industry believe that Ireland will follow in the footsteps of other countries in the medium term by giving retail investors an opportunity to buy into hedge funds for the first time.

Brian Gray, Goodbody Stockbroker’s chief investment officer, said that the individual Irish investor should be able to buy into hedge funds in Ireland in the medium-term rather than in the near future. ‘It will be an evolution rather than a revolution. There is a slow trend in that direction. As the pace picks up in the institutional market, we’ll see growth in the retail market,’ Gray told FINANCE magazine.

The UK and Germany are already offering hedge funds to retail clients. In 2004, Germany introduced new regulations that allowed asset managers to sell hedge funds to retail investors. Deutsche Bank now offers German retail investors the chance to buy into a hedge fund from as little as E124. Individual investors can opt for either Deutsche Bank’s ‘Hedge Long-Short Equity Market Neutral Fund’ or its ‘Hedge Long-Short Equity Opportunistic Fund’. The market neutral fund has equal long and short positions whereas the opportunistic fund can bet on rising markets by taking more long positions or on falling markets by taking more short positions.

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Hedge funds GROWING UP FAST

February 11, 2006
From TMCnet:
 Hedge funds GROWING UP FAST Institutional investors will ensure that hedge funds become less risky, if a little less exciting Hedge funds have evolved from being opaque and secretive funds, aimed at rich and sophisticated institutional investors.

But they still have a mysterious and glamorous image as get-rich investments, offering high consistent returns.

Domestic SA hedge funds barely existed before the mid-1990s investors arguably could get rich easily enough through the JSE itself, and much of the get rich money found its way, legally or not, into international markets.

A few fund managers, disillusioned with the traditional fund management industry's obsession with benchmarks and relative performance, identified a gap in the market for consistent positive returns, which hedge funds provide.

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Equity hedge funds beat stocks in January

February 9, 2006
From Reuters UK:
 Hedge funds which trade stocks and those that bet on financial market trends started the year with strong returns of nearly 4 percent, above the gains seen on equity markets, French business school Edhec said on Wednesday.

Long/short equity hedge funds, those that buy and short sell -- bet on a lower price for a security in the futures -- returned on average 3.93 percent in January compared with 3.16 percent for the MSCI index of world stocks.

"Equity markets generally rose in January," one hedge fund analyst said. "Hedge funds did better because they picked the right ones to be in and managed to beat the average stock market rise."

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Funds of Funds

February 1, 2006
From On Wall Street:
 For something that was once the Next Big Thing on Wall Street, hedge funds have not made much of a difference for the average wirehouse adviser. Only about 6% of brokers use them, according to Tiburon Strategic Advisors. But a series of developments--in the area of new products, investment approaches and regulation--is bringing hedge funds closer to the everyday investor. The real question is: Is that a good thing?

By far the biggest development is the proliferation of "funds of hedge funds." These products accounted for some 57% of all hedge-fund assets as of September 2005, up from 49% at the end of 2004, according to The Barclay Group, a Fairfield, Iowa, consulting firm. Funds of funds often have lower minimum thresholds than the underlying hedge funds--a key point since few clients have the multiple millions of dollars needed to invest directly in some hedge funds. The fact that funds of funds diversify their holdings across multiple hedge funds also reduces the possibility that money will be invested with a single dishonest manager--or one who's simply not that skilled. In that sense, funds of funds have the same risk-reducing characteristic as team-managed mutual funds.

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Ex NAPF chief named to BESTrustees board

January 19, 2006
From International Publishers Limited:
 Peter Thompson, former Mercer HRC worldwide partner and ex-National Association of Pension Funds (NAPF) chairman, has been appointed to the board of BESTrustees as director.

Thompson – an actuary with some 30 years of pensions experience – joined BESTrustees in April 2005 as an associate.

Thompson told IPE that this is a new position on the board, and that his new responsibilities are still to be confirmed.

He added that BESTrustees is taking on several new clients, and that there are plans to expand the number of associates. Thompson’s successor has not yet been named.

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Premium Content Added to DOW Jones Hedge Fund Indexes

January 18, 2006
From HedgeCo.Net:
 Dow Jones Indexes, a leading global index provider, has launched a premium content section on its hedge fund indexes Web site. The new section provides in-depth analytical tools and news to give media and investors greater transparency of the Dow Jones Hedge Fund Strategy Benchmarks and insight into the industry.

Dow Jones Indexes developed the new premium section in an effort to better inform market participants of the performance and break down of the six hedge fund strategies that make up the Dow Jones Hedge Fund Strategy Benchmarks.

To access the premium content of the Web site (www.djhedgefundindexes.com), users must fill out an online registration form. Registration is free.

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