Hedge Funds and CTAs

Global Recovery Investments, a joint venture set up by a former Bear Stearns executive, is prepping its Global Recovery Fund, a distressed hedge fund, for launch in the third quarter with between $10 million to $20 million in assets.

A team of Bear Stearns distressed debt traders have joined Tudor Investment Corp. to incubate a new credit-related strategies firm.

Diamond Lake Investment Group, the hedge fund firm set up by former Merrill Lynch investment banking co-chief Dow Kim, has suffered another setback with the departure of Namuk Cho.

With more than 96% of its assets evaporating in the withering heat of the credit crisis and its manager running for the exit, Odey Asset Management has liquidated its Japan & General fund, once its largest.

Portland, Ore.-based JE Moody & Co. is soft closing its $203 million JEM Commodity Relative Value Program, which celebrated its second anniversary last month and is up an estimated 7.54% year-to-date.

Copenhagen, Denmark-based Danfonds is readying its first hedge fund, Frontier Market Fund, for launch later this year with more than €25 million (US$39 million). The firm will cap the fund at €200 million (US$315 million) and is in talks with potential seed investors.

The Frontier fund, which will debut after September, will look for long positions in the frontier markets of sub-Saharan Africa, central Asia and the Caucasus, the Balkans, the Baltics and the Middle East.

Hedge fund assets have soared to more than $2.9 trillion despite disappointing returns, although investors are showing slightly less enthusiasm for the asset class.

Not content with beating horse hedge-fund-to-be International Equine Acquisitions Holdings on the track, Hall of Fame trainer Nick Zito plans to beat them at their own game.

Accelerator Capital, the $150 million seeding joint venture between Arrow Hedge Partners and Marret Asset Management, is making its first commitments to a pair of Canadian long/short managers.

The explosive growth of hedge funds over the past several years has been driven, in no small part, by sovereign wealth funds.