Looking back on Tudor’s flat panel play and a Bank of America credit spinout

March 19, 2012   Rob Copeland


AR also revisits fee increases for the biggest hedge funds.

One year ago
»» The largest hedge funds continued to raise fees as they reported strong fundraising figures. The average management fee charged by funds with $5 billion or more in assets was 2.04%, up nearly 56% from 1.31% a year earlier, while the average performance fee for those funds rose to 22.28%

Perhaps related to middling performance during the past year, the average price charged by the biggest funds is now slightly lower. They now collect an average of 1.84% in management fees and 21.74% in performance fees, according to an analysis of AR data. Major institutions, however, often negotiate breaks on the sticker price.

Overall as an industry, management and performance fees for new funds averaged out to 1.80%/19.86% last year.

See also: Going long: Managers collect fees and avoid shorts and high-water marksIn terms of fees, benefits of scale don't tilt in favor of investors

»» Srinivas "Srini" Dhulipala, co-head of credit investing on Bank of America Merrill Lynch's proprietary trading desk, hoped to raise $500 million for the third quarter launch of a credit hedge fund.

The strategy, named Kildonan Castle Global Opportunity Fund, did indeed launch in November, and fundraising documents filed with the SEC indicate a capacity of up to $1.5 billion. It was unclear how much the fund did raise, but it was at least $140 million, according to filings. And the fund launched during a period of relatively positive returns for credit hedge funds.

Dhulipala did not respond to a request for comment.

Five years ago
»» Tudor Investment Corporation purchased $12 million worth of convertible preferred shares in Uni-Pixel, which makes films to coat flat panel screens, and other related technology. At approximately the same time, two Tudor executives were appointed to the company's board of directors.

The agreement contained a provision that the company begin searching for a permanent chief executive officer, a milestone which was achieved two months later with the promotion of Reed Killion.

Tudor, which manages $10.3 billion, sold nearly all of the remainder of its Uni-Pixel stake in the last quarter of 2011, according to filings, and now owns just $1,520 of stock in the company. Its executives no longer sit on the Uni-Pixel board.

Tudor was not immediately available for comment.

See also: Paul Tudor Jones: I have had trouble sleeping this yearTudor returns to its roots



Latest Poll

Will other pension funds follow CalPERS out of hedge funds?

 - 30%
 - 70%

View previous results