Investors seem to be cooling on equity-oriented hedge funds.
There were 74 hedge fund launches in the first quarter,
according to a new report from Preqin, 89 percent of which were
single-manager hedge funds. Interestingly, the percentage of
the new funds that employ an equity strategy fell to 28 percent
of the total, the second straight quarterly decline. Equity
strategies accounted for 32 percent of total launches in the
fourth quarter of 2017 and 37 percent of the total new launches
in the third quarter, according to Preqin.
"This may indicate that fund managers’ outlook
for equity strategies aligns with the views of many investors,"
Preqin states in its report. The firm points out that a recent
survey of investors found that 45 percent think we are at the
peak of the equity cycle. Rather, event-driven
funds’ proportion of new launches surged to 21
percent in the first quarter, up from 6 percent the previous
period and 9 percent in the third quarter of 2017. There was
also a surge in the share of relative value funds, to 17
percent in the recent quarter from 8 percent in the fourth
quarter of 2017, 9 percent in the third quarter of last year,
and just 6 percent in the second quarter of 2017.
Chase Coleman’s Tiger Global Management led a $17 million
Series A round of financing for Green Bits, which offers a
management and automated compliance platform to help cannabis
dispensaries and retailers run their businesses, according to
the company. The new round of financing boosts Green
Bits’ total outside funding to $19.3 million. "We
are honored and excited to have Tiger Global join our team,"
said Ben Curren, co-founder and chief executive officer of
Green Bits, in a press release. "We have grown quickly in a
short period, and this new capital will allow us to
exponentially accelerate our growth. Our goal is to be in every
state that has legalized cannabis in some way."
Adage Capital Partners said in a regulatory filing that as of April 11, it
owned 2.225 million shares of AveXis, or 6.04 percent of the
clinical-stage gene therapy company. We don’t know
how many shares the hedge fund owned at the end of the first
quarter, but at year-end it owned slightly fewer than 1.5
million shares. In a 13D filing, Adage said it acquired the
shares for investment purposes in the ordinary course of
business "and not with the purpose nor with the effect of
changing or influencing the control or management" of the
company. It explained that it filed a 13D because it believed
it may not be eligible to file on a 13G. It engages in
investment strategies that include merger arbitrage and
event-driven strategies. Meanwhile, earlier this month, AveXis
agreed to be acquired by Novartis.
Boaz Weinstein’s Saba Capital Management said
that as of April 12 it owned 5.99 percent of Nuveen Connecticut Quality
Municipal Income Fund, a closed-end mutual fund. The stock is
trading at close to a 14 percent discount to its net asset
value (NAV). In recent years Saba has been aggressively pushing
for closed-end funds to take some sort of measures to narrow or
close their NAV discount.