Monday, May 21, 2007

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“The nobler sort of man emphasizes the good qualities in others, and
does not accentuate the bad.”
- Confucius

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 Top Stories


Merrill to Acquire Stake in Goodman's GSO Hedge Fund (Update2)
Source: Bloomberg
Merrill Lynch & Co., the world's biggest brokerage, agreed to buy a minority stake in Bennett Goodman's GSO Capital Partners LP, the firm's second investment in a hedge fund in eight months. More...

OECD says hedge funds highlight need for stress testing, education
Source: MarketWatch
Hedge funds help provide liquidity and reduce volatility in financial markets, but because of their complexity and the growth of the structured products they often trade, portfolios should be stress-tested for the impact of a worst-case scenario, the Organization for Economic Cooperation and Development said in a report published Monday. More...


Packer cashes up in hedge-fund float
Source: The Age
JAMES Packer is expected to supply more evidence the bull market is full of believers as early as today by unveiling plans for a $600 million hedge fund float. More...

RCG Preps Global Fund Of Hedge Funds
Source: FINalternatives
Alternative asset management shop RCG Capital Advisors is gearing up to launch a global equity long/short fund of funds in the third quarter. The new hedge fund offering will start out investing with about 20 managers, each of whom typically has a track record of two or more years, so emerging managers need not apply. More...

More of Today's Stories continued below...  or  Today's Stories unabridged on the web

  Term of the Day & Related News

Derivatives

A derivative is a financial contract whose payoffs over a period of time are derived from the performance of assets, interest rates, exchange rates, or indices. This performance can determine both the amount and the timing of the payoffs. These payoffs can be in cash, as well as be the delivery of the underlying asset. The indices can range from a stock market index or the consumer price index (CPI) to an index of weather conditions.

One use of derivatives is as a tool to transfer risk. For example, farmers can sell futures contracts on a crop to a speculator before the harvest. The farmer offloads (or hedges) the risk that the price will rise or fall, and the speculator accepts the risk with the possibility of a large reward. The farmer knows for certain the revenue he will get for the crop that he will grow; the speculator will make a profit if the price rises, but also risks making a loss if the price falls.
More...
 
Related News:

Derivatives contracts prosper in '06
Source: InvestmentNews
Over-the-counter derivatives contracts flowered to $415 trillion in notional amounts during the second half of 2006, a 12% gain, the Bank for International Settlements said.
More...

Super Derivatives tops "Inside Market" provider rankings
Source: Globes Online
SuperDerivatives, a developer of software for multi-option asset pricing and risk management has won the “Best Data Provider for Derivatives” rating by financial institutions and corporations in investor news magazine "Inside Market" Data Awards for 2007. The company's competitors included global news agencies such as "Reuters" and "Bloomberg."
More...

  Scholarly Article & Related News

The Diversification Properties of Hedge Fund Investments
by Eckhard Freimann
This study analyses the trade off between manager specific and systematic risk of portfolio of hedge funds. We compare the properties of naively constructed portfolios with those of fund of hedge funds, in order to assess the added value of the hedge fund managers. The results suggest that the hedge fund investor is confronted with the dilemma of having either a concentrated portfolio with a high volatility but a low systematic risk or holding a well diversified portfolio with a low volatility but a high systematic risk...
More...

 
Related News:

Are You in the Right Stocks?
Source
: The Motley Fool
One thing that often gets lost in all the talk of sizzling stocks and 20-baggers is the benefit of diversification. It's a concept every investor can understand and profit from.
More...

‘REMFs will allow greater diversification across cities’
Source
: The Financial Express
While the RBI has asked banks to slow their exposure on the real estate sector sensing a bubble, the sector continues gets a slow and steady flow of investments from private equity players. Anuj Puri, MD, Trammell Crow Meghraj, advises investors to reposition, redevelop, and efficiently refinance their portfolios, which ensures converting a sub-performing asset to a stabilised asset. More...

  Top Stories by Category
  Book of the Day & Related News

   
The Futures Game
by Richard J. Teweles, Frank J. Jones
Average Customer Review: 4.5 
out of 5 stars
 
 
Book Description
Whether you are a trader, a broker, or an interested student, this second edition of the best selling classic-now in paperback-will satisfy your needs better than any comparable work in print. Written in an easy-to-grasp, nonmathematical style, it remains the only work to cover every facet of the futures game-from fundamental market theory to market-tested real-life applications-and gives you straight-from-the-shoulder counsel about the difficulties and potential rewards you may encounter. Scientifically researched, clearly presented, and chock-full of practical applications you can consult with confidence every working day, this essential work will form the cornerstone of your successful futures game plan.

Related News:

China`s futures investors to have security fund
Source: Zee News
China will set up a fund worth up to $103.9 million to compensate futures investors in case their brokers fail to pay back their margin, the securities watchdog said.
More...

ICE sees first Dubai crude oil futures trade
Source
: Reuters
ICE Futures (ICE.N: Quote, Profile, Research new Dubai sour crude oil futures contract saw its first trade early on Monday in the opening salvo of ICE's battle with the New York Mercantile Exchange for the dominant Middle East contract. More...

 

  Personal Interest


Fire damages London landmark Cutty Sark
Source: The Los Angeles Times
London's famous maritime landmark, the Cutty Sark, suffered substantial damage today after an early morning fire engulfed the national treasure and destroyed much of its deck and planking. More...


'Shrek The Third' Tops US Box Office Sales
Source: VOA News
A green ogre reigns atop the latest U.S. box office list. Shrek The Third took in $122 million in its first weekend - the best-ever debut for an animated film, according to studio estimates. The DreamWorks production bested the $108 million opening of its predecessor, 2004's Shrek 2. More...

 

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   Top Stories (Continued)


BIS warns banks on hedge funds
Source: FT Alphaville
The Bank for International Settlements will warn on Monday that investment banks have become less disciplined in their dealings with hedge funds and that regulators may need to press both the banks and hedge funds to reveal more data about their market activities and step up their level of stress-testing in areas such as derivatives. More...

G8 seeks to curtail risks from hedge funds
Source: The International Herald Tribune
The G8 is warning banks and securities dealers around the world to demand more accountability from the hedge funds they deal with - or else face stiffer regulations for hedge fund business in the future. More...


Hedge fund guru: Improve U.S. math skill
Source: The Prescott Herald
James Simons knows a thing or two about the laws of supply and demand. He has been running the successful Renaissance Technologies investment firm for more than 20 years. More...

JPMorgan ‘misled’ Athens over bond: hedge fund
Source: FT Alphaville
JPMorgan misled the Greek government about its handling of a highly controversial structured €280m bond earlier this year for the Athens government, a hedge fund involved in the situation has claimed. The investment bank knew the bond would be quickly passed along a pre-planned chain, contradicting a statement JP Morgan that it was ignorant of these pre-planned deals, according to London-based North Asset Management. Its allegations threaten to fuel a growing political scandal in Greece about structured bonds arranged by investment banks. More...

Merrill Lynch boosts hedge fund services
Source: The Age
Investment bank Merrill Lynch is beefing up its hedge funds brokerage service in Australia and overseas as it anticipates rapid growth in the $2 trillion global industry. More...

Rosenfeld plants hedge in Rye Brook
Source: Fairfield County Business Journal
Eric Rosenfeld, one of the financial engineers behind the collapsed Greenwich hedge fund Long-Term Capital Management (LTCM), reportedly is setting up a new fund in Rye Brook, N.Y., called Quantitative Alternatives L.L.C. More...

HK poised to relax hedge fund policy
Source: The Financial Times
The Hong Kong securities regulator is poised to relax an important licensing requirement for international hedge fund managers in a move that could help the territory fend off challenges from Singapore and other lightly regulated financial centres. More...

Worries grow over pension investments in hedge funds
Source: The Chicago Tribune
When the hedge fund Amaranth Advisors LLC flamed out last year after disastrous bets on energy prices, San Diego County's retirement fund was among those burned. Losses to its portfolio were estimated at $100 million. More...


Today's Stories unabridged on the web
 

 
   Today's Humor

We just hired a new consultant at my job. I asked him a question.

He said, "I could tell you, but then I would have to bill you."

 

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