Friday, 29 August 2014
Last updated 12 hours ago
Jan 29 2010 | 9:52am ET
Leave it to the hedge funds to rain on everybody’s parade. This time, the role of black raincloud is being played by quantitative hedge fund firm CQS, which argues that the growing economic optimism is misplaced.
The firm told clients this week that both the U.S. and U.K. housing markets are primed for another dip, and warned of a distressed cycle this year that will “dwarf” that seen over the past year, the Financial Times reports.
With the world’s governments and central banks planning to pull back from the markets this year after propping up the financial system with billions in bailout money, CQS founder Michael Hintze said “the easy liquidity trade has gone.”
And with its exit, according to CQS, will come market dislocations.
“We have serious concerns about the level of adjustment we have seen in the U.K. housing market,” Alistair Lumsden, who manages the firm’s asset-backed securities hedge fund, said. “Affordability is very challenged in the U.K. For the moment, we think the U.K. is quite stretched.” Lumsden said the U.S. housing market is in for some trouble, as well.
Trouble for the economy, of course, doesn’t necessarily mean trouble for a hedge fund. CQS is aiming to profit from its pessimism: Mark Unferth, who manages CQS’s distressed-debt strategies, said the firm has begun “harvesting capital” from its current investments as it prepares for market declines and widening credit spreads later this year.
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...