Hedge Fund Managers Liquidate: Expect Downward Pressure on Top Holdings

Boston-based Raptor Global Funds announced Tuesday in a letter to investors that it was closing shop. The firm was formed in January of this year when James Pallotta spun-off from Tudor Investments with Tudor's Raptor Global and Altar Rock hedge funds. Mr. Pallotta had been vice chairman and managing director of the Raptor funds at Tudor. After the spin-off, Mr. Pallotta’s team continued to sub-manage an equity portion of Tudor's main BVI Global Fund. The letter gave no indication of who will manage those assets after Raptor’s liquidation.

The liquidation process is likely to place downward pressure on some of the top stocks in Raptor’s portfolio. As of 3/31/09, the firm reported with the SEC that it held nearly $360 million across 61 US-listed Equity Securities. The positions where Raptor held the largest percent of share outstanding include:

• Mako Surgical Corp. (MAKO), $7.33 Million, 949,287 Shares, 5.2% Held
• CF Industries Holdings Inc (CF) - $61.34 Million, 862,378 Shares, 1.5% Held
• Hilltop Holdings Inc (HTH), $5.23 Million, 458,700 Shares, 0.8% Held
• Intermune Inc (ITMN), $4.31 Million, 262,200 Shares, 0.7% Held
• Terra Industries Inc (TRA), $13.76 Million, 490,000 Shares, 0.5% Held

Another Tudor-spin-off, Dwight Anderson’s Ospraie Management liquidated its main hedge funds in late 2008. Just last month, the firm announced it was returning to the commodities game by launching very similar funds. (for more info see here.)

Another Boston-based hedge fund that announced it was liquidating this week is Noble Partners, L.P. The firm was founded by CEO George L. Noble in 1991. Prior to founding the firm, Mr. Noble managed the global equities focused Fidelity Overseas mutual fund. As of 3/31/09, the firm reported with the SEC that it only held nearly $37.4 million across 6 US-listed Equity Securities. Three months earlier, the hedge fund manager had held $508.5 million across 21 securities.

Disclosure: No positions

Comments

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The good news is that Barclays Capital sees USD 50BN of new allocations this year to hedge funds.

2009 Jun 04 08:10 AM

[russ]

The article is valid and worthwhile, the headline for the column is misleading and poorly written

2009 Jun 04 08:30 AM

[notsosmart]

how much do you have to lose before you learn to quit these ponzi schemes??? i guess with some its easy come ,easy go.

2009 Jun 04 08:59 AM

[axelrod608]

In an ironic sense, it's good to know that even some of the "professionals" are losing/have lost the farm in these times.

What surprises me is that after last year's meltdown, there are still folks who turn their capital over to strangers to do what they don't know or understand. Talk about blind faith....

2009 Jun 04 09:24 AM

[rich c]

From the article, "The liquidation process is likely to place downward pressure on some of the top stocks in Raptor’s portfolio."

How is the title misleading??????


On Jun 04 08:30 AM russ wrote:

> The article is valid and worthwhile, the headline for the column
> is misleading and poorly written

2009 Jun 04 09:49 AM

[Kidmag]

I wouldn't trade on that information.

2009 Jun 04 11:29 AM