Friday, 31 October 2014
Last updated 13 hours ago
May 2 2013 | 9:41am ET
Crestline Investors is going zombie-hunting.
The hedge fund has formed a joint venture with merchant bank Kirchner Group to acquire and manage "zombie funds"— private equity funds with little hope of earning performance fees again due to portfolios full of underperforming assets. Crestline-Kirchner Private Equity Group will seek to buy interests in such funds on the secondary market.
"Limited partners are realizing that there are alternative solutions to underperforming funds, and now is the right time for us to scale up to meet rapidly increasing market demand," Crestline said.
For its part, Crestline may look to recapitalize zombie funds, among other options.
It is estimated that zombie funds make up as much as $100 billion of the $1.5 trillion private equity industry.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Traders form habits quickly. Understanding these and their effects can better equip us to decipher actual market moves.