Wednesday, 30 July 2014
Last updated 13 hours ago
Jun 11 2014 | 9:54am ET
Polygon Investment Partners was mad last month over a research report attacking one of its largest investments, and it’s even madder now.
Polygon’s 11-month winning streak was snapped in April, after Gotham City Research called Quindell Portfolio “a country club built on quicksand” whose shares are worth no more than £0.03. The firm distributed its report to a number of hedge funds, sending Qundell shares plummeting.
Those losses extended into last month, sending Polygon down 1.39% and cutting its year-to-date gains to 8.69%.
“One of our underperforming strategies during the month was Quindell PLC, which traded down 17%, still reacting, we believe, to the publication of the Gotham report in April.” The hedge fund previously attacked that report as “highly sensationalized” and little more than a “dossier rehashing QPP’s historical red flags” that neglects “to mention any of what we feel are strongly mitigating factors such as the valuation and high-quality new business contracts.”
Polygon also dismissed Gotham City as a firm that has “been in business for less than two years and provide[s] little transparency about themselves.”
Polygon isn’t the only hedge fund fuming about the Gotham City report: In April, Algebris Investments accused the firm of insider-trading and market manipulation, filing complaints with both U.S. and British regulators.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…