1.8.2007 - Hedge funds pluck money from air in USD19 billion weather gamble
Credit Suisse Group trader Patrick Ayash rarely reads earnings estimates and just skims news about inflation. One thing he never misses: the daily weather report. Ayash, 31, is part of an army of mathematicians, hedge-fund whizzes and programmers pouring into the USD19 billion market for weather futures, financial instruments tied to everything from storms over Kansas, an early frost in the Netherlands, or a frigid spring in New York. The market was once a sideline for utilities looking to insure against swings in demand for natural gas or electricity. Now, with hedge funds increasingly hungry for market-beating returns, more are gambling on untested strategies. Tudor Investment Corp, DE Shaw & Co and other funds are turning teams of statisticians loose to devise novel ways of exploiting weather fluctuations.

2.8.2007 - Fortis Opens New York Derivatives Office, Expands London Team
Fortis has opened a commodity derivatives unit in New York and expanded its London team, bringing eight new dealers aboard. The New York office is pending approval from the National Futures Association.

2.8.2007 - Japanese retail investors bet against yen
Yield-hungry Japanese retail investors have used the recent sharp appreciation in the yen as a chance to build up record bets against the Japanese currency, sparking speculation that Japanese housewives could put the brakes on the recent carry trade unwind.

2.8.2007 - Orc Launches Colocated-Hosted Algo Derivatives Platform
Orc Software has launched Orc Liquidator Hosted, a new hosted platform geared at those deploying custom algorithmic derivatives trading strategies.

3.8.2007 - Reuters Business Week  Video news
A century old reign ends for the controlling family of the Dow Jones, mortgage worries weigh, and job growth weakens. 92,000 new jobs were added to American payrolls in July, the slowest pace since February. The mortgage mess continued to claim new victims, this week several more lenders taking a hit. Oil hits a new intraday record nearing 79 dollars a barrel.

3.8.2007 - Jim Rogers Says He Still Owns China, Japan; Likes Water Stocks  Video news
Jim Rogers, chairman of Beeland Interests Inc., talked with Bloomberg's Pimm Fox about his reasons for pulling out of emerging markets investments, conditions in the U.S. housing market, and investment strategy in Asia and in commodities.

10.8.2007 - Wheat prices weather broader downturn
Commodities prices suffered losses this week as the credit turmoil hit the energy and base metals markets, triggering speculative liquidation. Fears that a global credit ...

10.8.2007 - Reuters Business Week  Video news
The Fed pumps money into the markets, triple digit swings in both directions, and former Home Depot boss Bob Nardelli gets a new job.

11.8.2007 - Renaissance hedge fund down 7 per cent
The Renaissance Institutional Equities Fund, a USD26 billion-plus hedge fund managed by mathematician James Simons, is down "in the order of 7 per cent" for the year through Aug 8, according to a letter the fund sent to investors Thursday. Renaissance, one of the largest "quantitative" hedge funds, told investors that it has "not had good luck during these last few days." It said it has been "caught in what appears to be a large wave of de-leveraging on the part of quantitative long-short hedge funds." Results for the past two trading days since the letter went out early Aug 9 could not be obtained.

12.8.2007 - Hedge funds braced for more pain
The much-heralded financial rocket scientists responsible for the explosion in complex mathematical trading strategies are bracing themselves for fresh pain after what one team of analysts called "the perfect storm" last week. Quantitative strategists, or "quants" as they are known, attempt to profit from pricing inefficiencies identified through mathematical models. These send buy and sell signals on small variations in price between different securities. One hedge funds manager said the average quantitative fund manager was down about 15 per cent in the first few days of August.

12.8.2007 - Man Group shares drop on sub-prime lending fears
Shares in Man Group PLC, the world's largest publicly traded hedge fund, fell 7.7 per cent Friday on investor concern the company could delay the public offering of one of its hedge funds and on weakness in financial market. Man Group stock dropped to 486.25 pence (USD9.88; EUR7.18) on the London Stock Exchange, while Britain's FTSE 100 fell 1.8 per cent, mirroring slides in the US and Asian markets. Shareholders are removing their money from fund managers as subprime mortgage lending in the US drags down global stock markets. Defaults on subprime loans, or those made to people with poor credit, have climbed sharply in recent months and have triggered concern about the impact on credit markets worldwide.

13.8.2007 - Quant quake shakes hedge-fund giants
Some of the largest firms in the $1.5 trillion hedge-fund industry have been hit this month by big losses among so-called quantitative funds, which use computer models ...

13.8.2007 - Cheaper metals help keep inflation down
Cheaper metals during July meant manufacturers’ raw material costs fell for the first time since the start of the year, helping to keep a lid on factory gate inflation, data released on ...

13.8.2007 - Equity derivatives volumes soar
Equity derivatives volumes are surging to daily records as traders scramble to take advantage of or hedge themselves against market turmoil and the resulting spike in volatility ...

13.8.2007 - Sonders of Charles Schwab Sees Risk Facing Hedge Fundsk  Video news
Liz Ann Sonders, chief investment strategist at Charles Schwab & Co., talks with Bloomberg's Lori Rothman from Stamford, Connecticut, about hedge fund redemptions ...

13.8.2007 - Quant funds reverse losses
Quantitative trading strategies turned in a good performance on Friday, potentially reversing up to 70 percent of the decline from the previous four days last week, said Matthew Rothman, global head of quantitative equity strategies at Lehman Brothers. But Rothman, speaking on a conference call, said further wide swings in financial markets were likely and that quantitative fund managers, who control more than USD1 trillion of assets, need to adjust their models.

14.8.2007 - David Tice Braces For Commodities Reversal
David W. Tice and Associates, the firm led by short-seller David Tice, is preparing for a reversal in natural resources markets. The firm has reduced the net exposure of its Prudent Global Natural Resources Fund to 51.7%--a "relatively defensive position," according to its latest monthly investor letter, which also names some of the biggest winners and losers held by the fund in June. Gary Lantta, managing director, did not return calls.

14.8.2007 - UBS Investment Bank launches algorithmic strategy system for commodities
UBS Investment Bank has launched the UBS Commodities Portfolio Algorithmic Strategy System (Comm-PASS), a portfolio-based algorithmic strategy that exploits momentum in the commodity markets to generate returns through automated long and short strategies.

14.8.2007 - CME Group to lay off 380 in restructuring
Chicago Mercantile Exchange, the derivatives exchange, will reduce its workforce by nearly 400 as part of a restructuring following its USD12bn (EUR8.8bn) merger with Chicago Board of Trade in July. The reductions will fall across CBOT and CME, but CME Group spokeswoman Anita Liskey declined to say how many reductions are coming from each company or how many people would be leaving in the first round of departures. The layoffs will be carried out through June 2008. The CME Group employs 2150 people. Each employee in the group will have individual meetings to discuss the cuts. Departing staff will be given enhanced packages including outplacement services.

15.8.2007 - Carry traders dash for the exit
As the turmoil on credit markets has spread to other asset classes, currency investors have been scrambling to reduce speculative trades. The result has been a sharp unwinding of the carry trade, where funds are borrowed in currencies of countries with low interest rates to invest in higher-yielding assets elsewhere.

17.8.2007 - CME raises margin requirement
The CME Group, the world’s largest derivatives exchange, on Thursday increased margin requirements across a range of products, limiting potential trading losses from increased market volatility. While exchanges review the leverage which traders can employ on a daily basis, the scope of the CME’s move was viewed as unusual.

17.8.2007 - Australian central bank buys currency to stem record fall
The Australian central bank bought its currency for the first time in six years Friday to stem the steepest one-day drop since it was allowed to trade freely in 1983.

17.8.2007 - Crude price edges up on hurricane worries
Commodities prices on Friday rose broadly after the US Federal Reserve stepped in to mitigate the economic impact of the credit turmoil by cutting the discount rate at which it makes loans to banks.

17.8.2007 - Dexion would rather switch than sink
Dexion Trading is out to prove there is more than one way to save a hedge fund. Rather than looking for a cash infusion from investors, a lá Goldman Sachs, the London-listed fund of hedge funds is urging its shareholders to vote to move its USD190 million in assets to the bigger, long-running Permal FX Financial & Futures Fund, that has USD8.7 billion AUM and 56 managers.

21.8.2007 - Pensions Go Soft On Commodities
The volatile market situation has prompted a growing number of institutional investors, especially pension funds, to turn to agricultural, or soft, commodities as a stabilizing factor, Pensions & Investments Online reports. “It’s unlikely that we would allocate simply to soft [commodities],” Andrew Raisman of Hermes Investment Management told PIO, “but we may include it as a portion of an investment in a fund of funds in which we would combine it with other [actively managed] commodity investments.”

21.8.2007 - John W Henry says fund up 15 pct in August
Hedge fund manager John W Henry, who suffered heavy losses on the yen carry trade in July, told the Boston Herald that one of his portfolios reversed course and is up 15 per cent in August. For days rumors swirled in the currency market and hedge fund industry that Henry's firm might be the next victim forced out business by volatile market conditions. John W. Henry's firm, which bets mostly on commodities, currencies, stocks and bonds, has suffered poor performance for more than a year.

22.8.2007 - Nymex broadens merger horizon
The New York Mercantile Exchange, the US energy and metals market which last week approached a Canadian peer, has confirmed it is in merger talks with other parties as rivals in the sector rush to consolidate. Nymex last night said in a statement it is in talks with "certain parties regarding a potential business combination" but said that discussions were only "preliminary".

22.8.2007 - Axiom's Syed Says Commodity Funds Trounce Falling Stock Markets
Axiom Fund Manager Ltd's Mohammed Syed, the world's best-performing investor in commodity hedge funds this year, says the stock market rout bolsters his view that grain, mining and oil beat falling equity prices. "If you'd invested in commodities, it would have limited the negative impact of the fallout,'' Syed, 44, founder and chief executive officer of Cayman Islands-registered Axiom, said in a telephone interview from his London office. The company manages more than USD200 million.

23.8.2007 - Gibbs of ABN Says Pace of Carry Trade's Return `Surprising'  Video news
Greg Gibbs, a currency strategist at ABN Amro Australia, talks with Bloomberg's Catherine Yang from Sydney about the yen and so-called carry trades, the U.S. and Australian dollars, and his forecast for monetary policies of the Federal Reserve and European Central Bank. The yen has risen 2.5 percent this week, rebounding from a nine-month-low on Aug. 17, as signs of growing appetite for risk such as higher stocks and commodity prices gave investors confidence to put on carry trades.

23.8.2007 - U.S. Treasury plan backfires: IMF focuses on dollar instead of yuan
The U.S. Treasury took two years to persuade the International Monetary Fund to police global currency markets - and just two months to trash the initiative once the IMF adopted it.

24.8.2007 - Weather hits wheat but oil avoids hurricane
Most commodities prices ended the week on firm footing, with a strong recovery among base metals, as traders bet that the impact of the credit turmoil on the global economy would be limited.

24.8.2007 - Xetra Hosts Commodity Index ETF
Deutsche Börse?s XTF segment welcomed the world?s first exchange-traded-fund to follow the performance of the Dow Jones AIG commodity index (DJ-AIGCI). Issued by Indexchange Investment, the Dow Jones AIG Commodity Swap EX is based on the index that includes 19 commodities weighted by activity and production volume, with the maximum set at 15%.

24.8.2007 - Gloom lifts from carry trades
Currency markets this week appeared to return to the trading patterns seen before the violent turbulence of the previous two weeks. Carry trades were re-established as volatility eased and yield-hungry investors emerged after a fortnight of extreme caution.

27.8.2007 - Pensions Still Wary Of HFs
Pension plans are still wary about investing in alternatives, especially in hedge funds, according to a new white paper by Northern Trust. In a survey conducted by CREATE Research of some 300 fund managers and defined benefit plans sponsors in 37 countries, Northern Trust found that just half of respondents invested in hedge funds, and of those, only one out of 10 expects to invest more in the future. Another 10% that don?t invest now, are contemplating HFs over the next three years, while one-third have no plans to allocate to them at all.