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☆ Hedge Fund Two Sigma Is Hit by Trading Scandal
▼ + stars: | 2023-10-29 | by ( Gregory Zuckerman | Juliet Chung | ) www.wsj.com time to read: 1 min

Two Sigma, co-founded by David Siegel, is attracting fresh regulatory scrutiny. Photo: Jeenah Moon/Bloomberg NewsA researcher at Two Sigma Investments adjusted the hedge fund’s investing models without authorization, the firm has told clients, leading to losses in some funds, big gains in others and fresh regulatory scrutiny. The researcher, Jian Wu, a senior vice president at New York-based Two Sigma, was trying to boost his compensation, Two Sigma has told clients, without identifying Wu. He made changes over the past year that resulted in a total of $620 million in unexpected gains and losses, according to people close to the matter and investor letters. Two Sigma has placed Wu on administrative leave.

Persons: David Siegel, Jian Wu, Wu Organizations: Sigma, Bloomberg, Sigma Investments Locations: New York

☆ Elite Universities Face Donor Revolt Over Mideast Conflict
▼ + stars: | 2023-10-24 | by ( Rachel Louise Ensign | Juliet Chung | ) www.wsj.com time to read: 1 min

David Magerman was in Israel celebrating a holiday by dancing with a Torah in synagogue when Hamas attacked the country earlier this month. When his alma mater, the University of Pennsylvania, put out a statement a few days later that called the assault “horrific” but didn’t explicitly condemn Hamas, he was incensed. Magerman, a hedge-fund veteran turned venture capitalist who has donated millions to the school, has since cut his ties with Penn. “I was just pushed over the edge by the equivocation of the response,” he said.

Persons: David Magerman, didn’t, Magerman, “, ” Organizations: University of Pennsylvania, Penn Locations: Israel

☆ Big University Endowments Hampered by Startup Write-Downs
▼ + stars: | 2023-10-23 | by ( Juliet Chung | Eliot Brown | ) www.wsj.com time to read: 1 min

Yale University’s endowment gained 1.8% for the fiscal year ending June 30. Photo: Tim Tai for The Wall Street JournalThe hangover from the bursting of the startup bubble is weighing on big U.S. university endowments, with write-downs in their growth and venture-capital investments driving a second straight year of weak returns. The Massachusetts Institute of Technology reported a loss of 2.9% and Duke University, a loss of 1% for the fiscal year ending June 30, while endowments at Yale and Stanford gained 1.8% and 4.4%, respectively. The median return for endowments and foundations of more than $1 billion was 5.6%, according to a preliminary estimate from Cambridge Associates.

Persons: Tim Tai Organizations: Yale, Wall Street, Massachusetts Institute of Technology, Duke University, Stanford, Cambridge Associates

☆ Juliet Chung — Reporter at The Wall Street Journal
▼ + stars: | 2023-09-12 | by ( Juliet Chung | ) www.wsj.com time to read: 1 min

Juliet ChungJuliet Chung is a reporter covering hedge funds for The Wall Street Journal in New York. She has reported on private investments boosting hedge funds' returns, managers’ conflicts of interest and big trades. She also has broken news of regulatory probes on Wall Street. Juliet previously was a features reporter for the Journal, which she joined in 2007 after reporting stints at Newsday and the Los Angeles Times. She graduated from Harvard College with a degree in sociology and earned a masters in sociology from Oxford University.

Persons: Juliet Chung Juliet Chung, Juliet, Gerald Loeb Organizations: Wall Street, Newsday, Los Angeles Times, Harvard College, Oxford University Locations: New York

☆ Shari Redstone’s National Amusements Strikes Deal With Lenders
▼ + stars: | 2023-09-12 | by ( Juliet Chung | ) www.wsj.com time to read: 1 min

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/business/media/shari-redstones-national-amusements-strikes-deal-with-lenders-195dc8a7

Persons: Dow Jones

☆ This Hedge Fund’s Two Feuding Founders Are Under Pressure to Make Peace
▼ + stars: | 2023-08-09 | by ( Gregory Zuckerman | Juliet Chung | ) www.wsj.com time to read: 1 min

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/articles/this-hedge-funds-two-feuding-founders-are-under-pressure-to-make-peace-6e9dad93

Persons: Dow Jones, 6e9dad93

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/articles/paramounts-parent-company-in-talks-with-creditors-after-disclosing-financial-risks-48c66390

Persons: Dow Jones

☆ Inside the Escalating Feud at One of Wall Street’s Biggest Hedge Funds
▼ + stars: | 2023-06-20 | by ( Juliet Chung | Gregory Zuckerman | ) www.wsj.com time to read: 1 min

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/articles/inside-the-escalating-feud-at-one-of-wall-streets-biggest-hedge-funds-a6e09853

Persons: Dow Jones

☆ A war between 2 billionaire hedge-fund founders spilled out into the open in an alarming filing
▼ + stars: | 2023-06-20 | by ( Matt Turner | ) www.businessinsider.com time to read: +3 min

John Overdeck and David Siegel created hedge-fund giant Two Sigma, amassing billions in wealth. Here's the relevant section of the filing:There have been a variety of management and governance challenges at the Adviser. These disagreements can affect the Adviser's ability to retain or attract employees (including very senior employees) and could continue to impact the ability of employees to fully implement key research, engineering, or corporate business initiatives. Nor can it agree on the org chart, the management structure, corporate governance, or succession plans. These disagreements might hurt Two Sigma's ability to retain and attract star employees, and those employees' ability to actually implement research, tech, or business initiatives.

Persons: John Overdeck, David Siegel, Juliet Chung, Gregory Zuckerman, Chung, Zuckerman, Jamie Nash, Kleinberg Kaplan, I've Organizations: Sigma, Bloomberg, Wall Street, Management, Management Committee, Chief Investment Officers

☆ Wall Street’s New Trade: Covid-19 Insurance Claims
▼ + stars: | 2023-04-27 | by ( Juliet Chung | Leslie Scism | ) www.wsj.com time to read: 1 min

This copy is for your personal, non-commercial use only. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law. For non-personal use or to order multiple copies, please contact Dow Jones Reprints at 1-800-843-0008 or visit www.djreprints.com. https://www.wsj.com/articles/wall-streets-new-trade-covid-19-insurance-claims-fc4e191c

☆ Macro Hedge Funds Hit by Financial Turmoil
▼ + stars: | 2023-03-23 | by ( Juliet Chung | Sam Goldfarb | ) www.wsj.com time to read: 1 min

The yield on the two-year U.S. Treasury note suffered its largest weekly decline since 1987 last week. Hedge funds that bet on big-picture market moves have been hit with steep losses as a spate of recent bank failures upends bets that interest rates would remain elevated. The souring of the wager led some, including Maniyar Capital Advisors and Haidar Capital Management, to lose more than 20% this month. Many of the funds, which had notched big gains as rates marched steadily upward in 2022, are now flat to down for the year following a steep recent drop in Treasury yields. So-called trend-followers, which try to take advantage of momentum in markets, also were hurt.

☆ Tiger Global Writes Down Venture Funds’ Bets by 33% in 2022
▼ + stars: | 2023-03-16 | by ( Juliet Chung | Eliot Brown | ) www.wsj.com time to read: 1 min

The Manhattan offices of Tiger Global, which has invested in hundreds of companies including TikTok’s parent. Tiger Global marked down the value of its investments in private companies by about 33% across its venture-capital funds in 2022, according to people familiar with the firm. The markdowns erased $23 billion in value from Tiger’s giant holdings of startups around the globe, one of the people said. Its private portfolio includes big bets on hundreds of companies including TikTok parent ByteDance and payments company Stripe. In the fourth quarter, Tiger’s newest venture funds lost between 9% and 25%.

Investors have purchased the debt of Silicon Valley Bank’s parent at distressed levels in hopes of profiting in a possible sale of assets. Creditors of Silicon Valley Bank’s parent company have formed a group in anticipation of a potential bankruptcy filing, through which they hope to profit from a sale of the collapsed firm’s private-wealth and other units, according to people familiar with the matter. The investor group, which is being advised by PJT Partners Inc., includes Centerbridge Partners LP, Davidson Kempner Capital Management LP and Pacific Investment Management Co., or Pimco, the people said. Most members bought parent SVB Financial Group ’s bonds coming into the weekend as they traded down to around 30 cents on the dollar, the people said. The group now holds a sizable chunk of SVB Financial’s $3.4 billion face value of bonds.

☆ Meta Looks to Divest Kustomer Amid Efficiency Drive
▼ + stars: | 2023-03-11 | by ( Jeff Horwitz | Juliet Chung | ) www.wsj.com time to read: 1 min

Meta said it is exploring strategic alternatives for Kustomer, a business-software company it bought last year. Meta Platforms Inc. is planning to divest Kustomer, a business-software company it bought last year in one of its largest acquisitions, as the tech company looks to refocus on its core business, according to the company and people familiar with the planned deal. “In light of Meta’s efficiency efforts, we’ve made the decision to focus on our fastest growing business messaging offerings, including the monetization opportunity for WhatsApp,” said Ryan Moore, a spokesman for the company. “We are currently exploring strategic alternatives for Kustomer and will continue to support Kustomer’s product and customer base throughout this process.”

NJOY is one of the few e-cigarette makers whose products have clearance from federal regulators. Marlboro maker Altria Group Inc. is in advanced talks to buy e-cigarette startup NJOY Holdings Inc. for at least $2.75 billion and plans to divest its stake in Juul Labs Inc., according to people familiar with the matter. The deal for NJOY, one of the few e-cigarette makers whose products have clearance from federal regulators, could be announced as soon as this week, the people said, though the talks could still fall apart. The proposed deal includes an additional $500 million earnout if certain regulatory milestones are met, the people said. The Wall Street Journal reported last June that NJOY had hired advisers and was exploring a sale.

☆ Hedge Fund Seeks Ouster of Union Pacific CEO
▼ + stars: | 2023-02-26 | by ( Juliet Chung | Lauren Thomas | ) www.wsj.com time to read: 1 min

Union Pacific’s fourth-quarter profit and revenue fell short of Wall Street’s expectations. Hedge fund Soroban Capital Partners is pushing Union Pacific Corp. to replace Chief Executive Lance Fritz , arguing the railroad has underperformed on his watch, according to people familiar with the matter. Soroban is a longtime Union Pacific investor, one of the company’s biggest shareholders with a 1%-plus stake valued at about $1.6 billion, the people said.

☆ Union Pacific Plans to Name New CEO This Year
▼ + stars: | 2023-02-26 | by ( Juliet Chung | Lauren Thomas | ) www.wsj.com time to read: 1 min

Union Pacific’s fourth-quarter profit and revenue fell short of Wall Street’s expectations. Union Pacific Corp. said Sunday it plans to name a new chief executive this year, hours after a major shareholder publicly urged the railroad company’s board to oust Lance Fritz from the job. Soroban Capital Partners, a New York hedge fund managing about $10 billion, on Sunday disclosed a letter it wrote to Union Pacific directors pushing for the change, arguing that the company has underperformed on Mr. Fritz’s watch. The letter was earlier reported on by The Wall Street Journal.

☆ Crossover Hedge Funds Lost Big in 2022. They’re Still Launching in 2023.
▼ + stars: | 2023-01-15 | by ( Juliet Chung | ) www.wsj.com time to read: 1 min

Hedge funds investing in fast-growing public and private companies lost tens of billions of clients’ money last year. That isn’t stopping more “crossover” funds from launching. Mala Gaonkar, 53 years old, a former co-investment chief of Lone Pine Capital LLC, launched her New York-based crossover fund, SurgoCap Partners, on Jan. 3 with $1.8 billion, people familiar with her firm said. Ms. Gaonkar’s launch was widely anticipated given her experience and marks the largest-ever startup from a female hedge-fund manager. Lone Pine, which Ms. Gaonkar left roughly a year ago, lost 36% in 2022 in its flagship hedge fund.

☆ Citadel Posts Record Revenues for Hedge-Fund, Securities Operations
▼ + stars: | 2023-01-05 | by ( Juliet Chung | Alexander Osipovich | ) www.wsj.com time to read: 1 min

Citadel ’s winning streak continued in 2022, with Kenneth Griffin ’s hedge-fund and electronic-trading businesses both posting record revenues even as markets swooned, people familiar with the matter said. Citadel, the hedge-fund operation with $54.5 billion under management as of Jan. 1, had about $28 billion in revenue, the people said. That far outstripped its prior record of $16.2 billion the year before. The separate Citadel Securities, one of the world’s biggest electronic-trading firms, had $7.5 billion in revenue, up from the prior record of $7 billion in 2021.

☆ Citadel, Other Big Hedge-Fund Winners in 2022 to Return Some Profits to Clients
▼ + stars: | 2022-12-21 | by ( Juliet Chung | ) www.wsj.com time to read: 1 min

Kenneth Griffin, with arm raised, is the founder of Citadel, which expects to return about $7 billion in profits to its clients in January. Citadel expects to return about $7 billion in profits to its clients on the back of what is expected to be its most profitable year ever, said people familiar with the firm, highlighting the banner year some hedge funds have had even as others nurse deep wounds. Citadel’s flagship fund gained about 32% for the year through November, benefiting from bets across the firm’s strategies, the people said. The firm plans to return some profits from all four of its funds in early January but still expects to start 2023 with more than $50 billion in assets under management, one of the people said.

☆ Tiger Global Halts New Chinese Equities Investments
▼ + stars: | 2022-11-03 | by ( Juliet Chung | Jing Yang | ) www.wsj.com time to read: 1 min

Tiger Global Management, which has offices in Midtown Manhattan, had been shrinking its exposure to Chinese equities, concentrating on a smaller set of companies. Longtime China investor Tiger Global Management has hit pause on investing in Chinese equities, said people familiar with the matter, as the firm reassesses its exposure to the world’s second-largest economy after President Xi Jinping cemented his control over the country. Tiger executives, including founder Charles “ Chase” Coleman , have told others that Mr. Xi’s reelection and his stacking of the Communist Party’s leadership with loyalists at the recent party Congress could increase geopolitical tensions and means the country’s Zero-Covid policy will likely continue, the people said.

☆ After Record Year, University-Endowment Returns Drop Into Negative Territory
▼ + stars: | 2022-10-31 | by ( Juliet Chung | Melissa Korn | ) www.wsj.com time to read: 1 min

Investment returns for university endowments have fallen back to earth after scoring their biggest gains in a generation the year before, reflecting a dramatically changed investment environment in which stocks, bonds and other assets have sold off sharply. The endowment of Washington University in St. Louis lost 10.6% in the fiscal year ended June 30 after notching a 65% gain the prior year, the school told The Wall Street Journal, shrinking its size to $13.3 billion. Other schools that have reported big swings in their multibillion-dollar endowments include Stanford University, which lost 4.2% after gaining 40.1% previously; Brown University, down 4.6% after posting a 51.5% increase; and the Massachusetts Institute of Technology, down 5.3% after rising 55.5%.

Marlboro maker Altria Group Inc. is in advanced talks to buy e-cigarette startup NJOY Holdings Inc. for at least $2.75 billion, according to people familiar with the matter, moving to take over a new vaping brand after its bet on Juul fizzled. The deal for NJOY, one of the few e-cigarette makers whose products have clearance from federal regulators, could be announced as soon as this week, the people said, though the talks could still fall apart. The proposed deal includes an additional $500 million earnout if certain regulatory milestones are met, the people said. The Wall Street Journal reported last June that NJOY had hired advisers and was exploring a sale.

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