News > All

96% of Chinese mutual funds were profitable in H1
Asset Management
<p>Here’s an interesting data point. According to Asia Asset Management, 2483 out of the 2593 registered mutual funds currently in China were profitable during the first half of the year.</p> <p>And not only that, the entire group apparently raked in a whopping $138 billion in revenue during the same time frame, almost $60 billion more than what the industry made in 2014.</p> <p>The three biggest winners appeared to be Shanghai-based China Universal Asset Management, which cashed in 46.7 billion yuan in earnings, the Deutsche Bank-backed Harvest Fund Management, which pulled in around 58 billion yuan in profits, while China Asset Management Co – otherwise known as China AMC – lorded above them all with an impressive 60.4 billion yuan in revenue.</p> <p>Granted, the Shanghai Composite did climb over 50% by mid-June, so even the most outright beta huggers should have came in deep in the black, but still, an impressive showing nonetheless.</p> <p>Everything kinda went downhill since that mid-June peak though, so it’d be interesting to see how the group fares during the second half. Unfortunately, Z-Ben Advisor’ Shichen Liu gave Asia Asset a pretty grim assessment:<br /> “Though [the] China Securities Regulatory Commission (CSRC) asked [the] China Securities Finance Corporation (CSF) and Central Huijin [Investment] to save the market, it [has] just simply slowed the drop of [the] stock market. However, [the] SHIBOR (Shanghai Interbank Offered Rate) (overnight)) has been increasing since July, which indicates that money market funds would have higher returns in the second half. The overall performance will still see a large decline compared to the first half [figures].”<br /> I wonder what happened to the 110 that didn’t make it, did they get caught by the sell-off? Curious what you guys have to say.<br /> Photo: Anthony Kelly</p>
Private instant messenger service thumbs its nose at critics
<p>Symphony, a messenger software for the banking sector, has taken a lot of flak recently. Backed by around fifteen large banks, the encrypted service had more than a few fans in the financial sector.</p> <p>Regulators hate it. The American Banker reports that Senate Banking Committee member Elizabeth Warren, among others, has come out saying the service would compromise regulators ability to stamp out fraud, and facilitate shenanigans like the Libor rate-rigging scandal. </p> <p>Symphony’s CEO David Gurle - who has had numerous meeting with US officials - appears unfazed by critics’ regulatory sabre-rattling and insists the service will go ahead with its planned September 15 launch. </p> <p>But he is going to have to convince the nay-sayers of Symphony’s merits to shift the focus away from its users. David Weiss, senior analyst at Aite Group, had this to say:<br /> "These are shots across the bow at Symphony's investors, whom they perceive as bad actors, not at Symphony itself. There's no regulatory oversight of Symphony as a company by any of these folks."<br /> Photo: Eleazar</p>
UBS settles with hedge fund over 'crap' CDO case
Hedge Funds
<p>Note to salesmen; if you’re selling crappy CDOs to hedge funds, try not to refer to them as such in your company emails, no matter how “kewl” it may be.</p> <p>According to Business Insider, UBS just forked over an undisclosed amount of money to Connecticut-based Pursuit Partners over allegations that the bank sold investment-grade collaterized debt obligations to the fund without disclosing that the notes were about to be downgraded.</p> <p>Apparently, Pursuit initially wanted $100 million from UBS, but brought the figure down to $35 million back in 2009, leading the Swiss bank’s legal team to say: “UBS is confident that it will prevail on the merits of the remaining claims.”</p> <p>Unfortunately for them, the bankers also had a lot to say about the notes, especially in their emails:<br /> “'Kewl', wrote UBS trader Evan Malik to Hugh Corcoran in an August 2007 email that began with the bankers talking over company email about wine purchases. ‘Sold some more crap to Pursuit.’</p> <p>In another email, UBS employee Tim Goodell said to Jared Menzel that the securities were ‘vomit;’ this was in September 2007.”<br /> The settlement came in just hours before a potentially scathing trial was about to take place.<br /> Photo: Frits Ahlefeldt-Laurvig</p>
Daily Scan: Chinese shares trim losses; S&P 500 futures on the rise
Capital Markets
<p>Updated throughout the day</p> <p>September 2</p> <p>Good evening everyone. Despite a rough and tumble ride to the finish, there was just no way Beijing would let the stock market rain on their parade. The Shanghai Composite closed down 0.2% after falling as much as 4.7% earlier in the day while the Shenzhen Composite trimmed its 4.8% drop to finish the session down 1.98%. Hong Kong’s Hang Seng Index and Japan’s Nikkei Average meanwhile, slipped 1.18% and 0.39% respectively.</p> <p>Here’s how the major European markets are faring:</p> <p> CAC 40: -0.11%<br /> FTSE 100: -0.01%<br /> DAX: -0.09%</p> <p>With Europe retracing losses, the futures market is signaling an upbeat open for the U.S. S&amp;P 500 minis are currently trading 0.61% higher, while contracts on the Dow as well as the Nasdaq point to a 0.58% and 0.63% climb at the open respectively. The upcoming ADP employment change and QoQ labor costs could easily throw a monkey wrench to that rally though.</p> <p>Here’s what else you need to know:</p> <p>“I am not sorry,” says North Korea. The hermit state has denied  Seoul’s claims that Pyongyang’s recent expression of “regret” after a marathon negotiations amounted to an apology for a land-mine explosion that maimed two South Korean soldiers. Japan Times</p> <p>U.K. construction hits longest growth period. The U.K.’s construction sector notched up its 90th month of growth today as the Markit/CIPS UK Construction PMI came in at 57.3 for August. The reading is slightly higher than July’s 57.1 showing and, as Markit notes, is well above the 50 threshold separating contraction from expansion. Markit</p> <p>Argentina calls for the head of HSBC chief. Argentina's central bank has ordered HSBC to replace its chief executive in the country within 24 hours, accusing the bank of failing to prevent tax evasion and money laundering. The bank was accused of helping clients hide money in Swiss bank accounts. BBC</p> <p>Streaming service Netflix launches in Japan. Netflix has partnered with Japanese mobile carrier SoftBank in a joint bid to tap some 36 million households with high-speed Internet access as part of global push. Channel News Asia</p> <p>Australian GDP growth falls. A slowdown in Australia’s mining and construction sectors dragged the June quarter’s GDP growth down to 0.2%, a substantial decline compared to last year’s 2% climb. A drop in exports also played a hand in the fall, though domestic final demand as well as the nation’s financial, transport, and health industries all helped buoy GDP from sinking lower. Australian Bureau of Statistics</p> <p> Thailand arrests “main” bombing suspect. Police hunting those responsible for the shrine bombing that killed 20 people in central Bangkok two weeks ago arrested a second foreign suspect on Tuesday, Prime Minister Prayuth Chan-ocha describes the man as the main person in the bombing. South China Morning Post (paywall)</p>
Buy the Great Bambino's apartment
<p>He's the sultan of swat, the king of crash, the colossus of clout, the Great Bambino, and his apartment is for sale.</p> <p>The late Yankee great Babe Ruth's Upper West Side apartment is on the market for $1.6 million, reports DNAinfo. The 1913 built apartment on 88th Street holds two bedrooms and three bathrooms, half of the entire floor that Ruth once owned. Monthly maintenance fees run close to $3,000.</p> <p>Julia Ruth Stevens, Ruth's now 99-year-old daughter, shared memories of the many Yankees that ate dinner and were visited in the home when the Ruths lived there between 1929 and 1940.<br /> “Mom and Dad loved to entertain there," Stevens told the Post. “We had a maid and cook, and Dad would always invite Yankees who had been traded and were in town with other teams. He knew they wanted a home-cooked meal [while on the road].”<br /> Photo: Jim, the Photographer</p>
Einhorn’s Greenlight reports August, down badly
Hedge Funds
<p>David Einhorn's Greenlight Capital revealed that its fund was down 5.5 percent in August, bringing the year to date loss to 14 percent, according to its web site. Looking for the silver lining, the hedge fund, known for its activism and finding value in the stock market with strong recent years past performance, did slightly outperform the S&amp;P 500 stock index at least on a monthly basis, which was down 6.3 percent in August.</p> <p>Greenlight under-performing on a yearly basis<br /> The August losses come as other hedge fund strategies had performed to various levels. Daniel Loeb's Third Pointhedge fund was down -5.1 percent in August, but remains higher on the year by a slim 0.02 percent. Balyasny Asset Management, meanwhile, adjusted its strategy parameters to hedge what they saw as the logical potential for volatility and were said to be near flat in August and up from 3 to 7 percent on the year, according to people familiar with the matter. (Additional report to come.)<br />  According to the most recent HSBC Holdings plc (ADR) (NYSE:HSBC) (LON:HSBA) Hedge Weekly performance ranking, through August the Equity Diversified / USA hedge fund category was up 0.88 percent year to date. The Multi-Strategy / Global category was up 1 percent while the Equity Diversified Long / Short category, which includes John Burbank’s Passport Special Opportunities Fund, was up 7.51 percent. It should be noted that some of the funds in the HSBC report had not reported their August performance. The Newedge CTA index, an benchmark of the largest algorithmic traders which requires firms to report performance on a daily basis, looked to close out August near a 1 percent loss.<br /> Greenlight asks questions, but likely not the questions that matter<br /> The sharp, unhedged losses come as the fund’s founder, David Einhorn, sent out a survey to his nearly 700 investors, according to a report in the New York Times. It is unclear It is unclear what the questions were, but below are a few questions that would have been most interesting for institutional investors to answer:</p> <p> When you invest in a “hedge” fund, do you expect that the fund will consistently “beat the market” on a multi-year basis, or do you expect that the fund will provide noncorrelated returns to a certain degree, help hedge a portfolio against negative stock market events?<br /> If a hedge fund c</p>
1 million TV viewers means $1M to charity
<p>Venture capital billionaire Tim Draper really, really wants people to watch his new reality show.</p> <p>Draper is offering $1 million to charities if his "Startup U" on ABC Family gets 1 million viewers this week, reports Hollywood Reporter. The reality show follows young entrepreneurs attending Draper University in Silicon Valley. The show, which premiered August 11, only attracted 47,000 viewers to its most recent episode. The philanthropy approach is certainly different than other business reality shows like "The Apprentice" and "Shark Tank" have used. Failure could sadly mean Americans are more interested in Donald Trump yelling at people than philanthropy.</p> <p>Draper's seven week, Draper University course teaches the basics of launching a startup, and gives students the opportunity to pitch their business ideas to venture capitalists. More than 150 past students have received more than $15 million total to begin their companies.</p> <p>Draper made his billions investing in companies like Hotmail, Skype, and China's Baidu, reports Venture Beat. For his next move, Draper announced that he is investing "a few million dollars" in California VC firm Wavemaker Partners.<br /> Photo: Disney | ABC Television Group</p>
Russian ETFs best performer in a very rough and tough August; commodities outperform stocks
Capital Markets
<p>This just in from Bespoke Investment:</p> <p>Russian ETFs edged down just 0.88% in August, outperforming other emerging market ETFs by a wide margin. Australia, China, Hong Kong, India, Brazil -- those ETFs all sank more than 10%</p> <p>Surprise, surprise, surprise: Oil ($USO) gained 1.92% in August after roaring back to life the last three days of the month. The S&amp;P 500 ($SPY) sank 6.10%.</p> <p>&nbsp;</p>
Daily Scan: Global markets slide; officer killed in Chicago
Capital Markets
<p>Updated throughout the day</p> <p>September 1</p> <p>Good evening,</p> <p>China continues to roil the markets: U.S. markets closed about 3% lower all around. The Dow lost 2.8%, after falling 2% right at the open. The S&amp;P 500 fell 3% and the Nasdaq dropped 2.9%. Oil slid about 8%, but continues to float just above $45/barrel. Car sales are bit more robust than expected and are likely to maintain their 17 million annualized pace for the fourth month in a row. The manufacturing orders report was a disappointment, still expanding but less than expected at 51.1%.</p> <p>Here's what else you need to know:</p> <p>Police officer fatally shot near Chicago. The Lake County officer was killed Tuesday morning while pursuing three suspects on foot. Police are currently looking for the suspects. CNN</p> <p>Kentucky clerk continues to defy court. Rowan County Clerk Kim Davis is refusing to issue marriage licences to same-sex couples, citing "God's authority" over the U.S. Supreme Court. Two gay and two straight couples filed a federal lawsuit against Davis in July after she refused to issue any marriage licenses. Davis may face fines if held in contempt of court. Reuters</p> <p>Pope Francis wants to forgive abortions. The pope announced Tuesday that all priests can absolve Catholics of the sin of abortion during the upcoming Extraordinary Jubilee Year of Mercy. The holy year, beginning December 8, is meant to focus on spiritual renewal. Only bishops have traditionally held the authority to forgive the gravest sins, including abortion, but in the past they have sometimes shared that power with priests. The pope's announcement doesn't give a pass on abortion for Catholics, but instead offers the opportunity of forgiveness and a change of heart in the Church. TIME</p> <p>Netflix ends relationship with Epix. The streaming service decided not to renew a deal with film distributor Epix, effecting pulling top movies including Hunger Games and Transformers. Netflix says it wants to focus more on exclusive content. Hulu is snapping up the Epix films for its subscribers instead. BBC</p> <p>Calpers, Calstrs want to separate Bank of America's CEO and Chairman roles. The two giant California pensions announced Monday that they would join shareholders in opposing the bylaw change that would allow Brian Moynihan to hold both roles in the company. Calpers and Calstrs, the two largest U.S. public pensions, hold a total of 63.6 million Bank of America shares, less than 1% of the total shares outstanding. Wall Street Journal</p> <p>U.S. to sanction Chinese hackers. The White House is reportedly creating sanctions against Chinese individuals and companies as U.S. tech firms – and the government itself – worry about the growing threat of China’s cyber-espionage. Financial Times </p> <p>UN confirms Palmyra temple destruction. A satellite</p>
Now there’s a “matchmaking service” for banks and fintech start-ups
<p>So banks now have a matchmaking service where they can hook up with financial technology startups. Its called Matchi.</p> <p>The Financial Times reports that Barclays, AIB, and Standard Bank are among a group of lenders partnering with fintech companies through Matchi. </p> <p>Accountancy firm KPMG has also struck an alliance with the online platform which it will introduce to its banking clients. Matchi will then support these clients with technology integration and advise on deals.   </p> <p>By “sponsoring” the platform, banks get privileged access to innovations developed by the startups. For example, the platform recently connected an Israeli fintech firm offering customer authentication with a global bank in India.</p> <p>It is another case of banks looking to embrace fintech start-ups, and the digital services they developing, rather than competing directly with them. In other words, keeping your enemies closer. </p> <p>Hopefully, the banks are getting into fintech for the long run, and not just a meaningless one-night stand they might regret in the morning.<br /> Photo: Jamz196</p>