| Bill Ackman at Ira Sohn 2010 (Photo: Bloomberg) |
One year ago»» The 2010 edition of the Ira Sohn Investment Research Conference didn’t disappoint. David Tepper of Appaloosa Management sang Elvis. Sam Zell of Equity Group Investments quoted “Charlie” Darwin, telling the crowd to evolve or go extinct. Steve Rattner’s proposal to close the income inequality gap got booed (or maybe the abuse was aimed at the ex-car czar himself). Steve Eisman of FrontPoint Financial Services said the for-profit education industry is just like the subprime bubble.
AR’s analysis of how manager recommendations performed a year later is here. The 2011 conference—held later today—will feature presentations by Bill Ackman, Jim Chanos, David Einhorn, Steve Eisman, Phil Falcone, Carl Icahn, Dinakar Singh and others. Watch for AR’s post conference recap Thursday.
»» Diamondback Capital Partners co-founder Chad Loweth left the firm.
The firm would attract national attention in November when the Federal Bureau of Investigation searched Diamondback’s offices as part of its probe of insider trading and how hedge funds used expert networks. While Diamondback was not the target of the investigation, news of the probe led to redemption requests totaling $1.3 billion, as AR recently reported. The firm managed $5.8 billion on January 1, 2011, according to AR’s Billion Dollar Club report, but currently runs about $4.4 billion. In an apparent sign of stabilization, some notable institutional investors, including the New York and New Mexico pension funds, have stayed in the fund despite former Diamondback employee Anthony Scolaro pleading guilty this month to insider trading, according to Reuters, suggesting the incident was isolated from the firm’s general practices. Diamondback declined to comment.
Five years ago
»» Duquesne Capital Management founder Stanley Druckenmiller backed Pennsylvania Republican Governor hopeful Lynn Swann.
Swann, a Pittsburg Steelers star and Republican, would lose the 2006 election to Democrat Ed Rendell. Druckenmiller announced his retirement in August, ending one of the most successful runs in hedge fund history. “I have had to recognize that competing in the markets over such a long time frame imposes heavy personal costs,” Druckenmiller wrote in a one-page letter announcing his plans to close his firm, also citing the challenges of running a large fund. Thanks to a late-year surge, Druckenmiller was able to reverse a 5% loss through August and finish the year up about 4.5%, according to AR’s Rich List. In all, he never had a down year and generated a 30% annualized return over 30 years. The closure of Duquesne spawned new funds, including Espalier Global Management and Point State Capital; Druckenmiller will reportedly continue to invest through a family office and turn his attention to philanthropy.
»» A rally in technology stocks boosted the Absolute Return Technology Index to a leading position among hedge fund investment strategies for the year. One of the big winners was none other than convicted inside trader Raj Rajaratnam’s Galleon Management and its tech-focused funds.
Sound familiar? The same AR Technology index was up 2.42% in April and 6.05% year to date. That’s second only to commodity-focused funds, which gained 7.86% over the first four months of the year.
