[willsurelywin]

Originally Posted by anandv

Now that Tumtum Sir has opened the topic of Any idea about compensation of best HF manager in 2007? :More than 1000 mil USD.

bt is this not what has led to total diasaster of subprime which has hit middle class people in USA who were made to think they r rich by home equities and now everything is in tatters..

only thes ei bankers/hedge fund managers have made money with all kind of crap instruments but now ICEBERG was at tipping point ..

we need some rules regarding executive pays and fines if companies fail..

:argue:

[Tumtum]

Originally Posted by anandv

Now that Tumtum Sir has opened the topic of hedge fund, the best book to be read is: When the genius failed. It is about rise and fall of LTCM.
Talking about Hedge funds' secrecy, one will find that most of the funds don't have any websites or only a plain website. Most funds wont let their investors know about their exact investments either. All their efforts are towards the absolute returns by hook or crook.
Ofcourse given, the secretive nature of HFs have attracted strong critics from many, givent the fall of LTCM, AMaranth and more. But yes, still they prosper and do not come under the purview of SEC,SEBI,FSA etc.

Any idea about total compensation of Indra Nooyi in 2007? Approx 15-20 mil USD
Any idea about compensation of best HF manager in 2007? :More than 1000 mil USD.

In fact, apparently last year our beloved "loongi wala" FM Chidambaram tried to rein in the "hot money" put in by Hedge Funds into Indian markets.

How?
By asking for substantial disclosures from the Hedge Funds who invest in Indian market through the "Participatory Notes" mechanism (FYI, HFs are prohibited to invest directly in Indian capital markets).

Additionally, substantial disclosures were also asked from the Ibanks issuing these participatory notes. A condition was put forth that if either Ibanks or HFs fail to provide these disclosures, then they will have to wind up their investments in the next 18 months.

Needless to say, Hedge Funds have preferred to pull the plug and withdraw their investments from Indian capital markets. I clearly remember the day....as we waited with bated breath to see how market reacts to this blow on Participatory Notes regulation, we saw that after the market opened, there was no trade for the first 1 minute....and then bang...down 400 points....that day saw Sensex decline 1700 points in total.

You folks must be hearing often that the FII outlfow of capital has led to market crash.....this is that FII Outflow explained !

I was just sharing my experience to show how shrewd these Hedge Funds can be. Feel free to ask for more !

Regards.

[konqueror_vivek]

Originally Posted by anandv

Any idea about total compensation of Indra Nooyi in 2007? Approx 15-20 mil USD
Any idea about compensation of best HF manager in 2007? :More than 1000 mil USD.

It is difficult to compare a manufacturing CEO with a Hedge fund manager, will be like comparing apples to oranges.
You might think of comparing Blankfein with John Paulson.

[D i g i S y n c]

Originally Posted by Tumtum

Digi.


The “Prop Trading” desks that you are talking about in Ibanks are actually elite desks…as in only some traders who have a very good track record and experience in investing and making consistent “alpha” are given the job. However, these desks are specific to an asset class as in….”Equities Prop Trading Desk” or “Commodities Prop Trading Desk” and so on. So these desks in Ibanks deal only in specific asset classes.

The kind of "desks" or investments you are talking about are what we typically call “Hedge Funds”.

If I'm not mistaken Goldman Sachs have their Goldman Sachs Global Alpha Fund. I was mentioning it that way. Goldman Sachs may have specific prop. trading desks and Goldman Sachs Global Alpha Fund might refer to their hedge fund? Their fund might deal in more than one asset class. Something like, same shirt but a different pocket. But thank you for making it more clear

Secondly many aggressive Hedge Funds are known to promise upfront to their clients a “specific rate of return” that they guarantee on a client’s investments and hence in a bid to provide higher returns, they generally set up their shop in “tax havens” such as Cayman Islands, Mauritius and Dubai. Also they are very secretive about the kind of investments they do.

That is the basic idea really. They are supposed to make profits no matter how bad the market is. With their secretive methods, exploiting the markets and maximum use of all the loop holes, it must be quite possible to keep their promises to their clients. Though there are some thousands of hedge funds in London, only a few are doing really very well.


Cheers!

[D i g i S y n c]

Originally Posted by anandv

Any idea about total compensation of Indra Nooyi in 2007? Approx 15-20 mil USD
Any idea about compensation of best HF manager in 2007? :More than 1000 mil USD.

You might find few different figures with one or two rank up/down, considering errors made by various agencies. But in general the information given below is true.

Top 10 moneymakers in the hedge-fund industry in 2007:

1 $3.7 billion, John Paulson, Paulson & Co.
2 $2.9 billion, George Soros, Soros Fund Management
3 $2.8 billion, James Simons, Renaissance Technologies Corp.
4 $1.7 billion, Philip Falcone, Harbinger Capital Partners
5 $1.5 billion, Kenneth Griffin, Citadel Investment Group
6 $900 million, Steven Cohen, SAC Capital Advisors
7 $750 million, Timothy Barakett, Atticus Capital
8 $710 million, Stephen Mandel Jr., Lone Pine Capital
9 $625 million, John Griffin, Blue Ridge Capital
10 $520 million, O. Andreas Halvorsen, Viking Global Investors


The average pay for any top hedge fund manager is $363 million.


Cheers!

[D i g i S y n c]

Originally Posted by Tumtum

In fact, apparently last year our beloved "loongi wala" FM Chidambaram tried to rein in the "hot money" put in by Hedge Funds into Indian markets.

How?
By asking for substantial disclosures from the Hedge Funds who invest in Indian market through the "Participatory Notes" mechanism (FYI, HFs are prohibited to invest directly in Indian capital markets).

Additionally, substantial disclosures were also asked from the Ibanks issuing these participatory notes. A condition was put forth that if either Ibanks or HFs fail to provide these disclosures, then they will have to wind up their investments in the next 18 months.

Needless to say, Hedge Funds have preferred to pull the plug and withdraw their investments from Indian capital markets.

You folks must be hearing often that the FII outlfow of capital has led to market crash.....this is that FII Outflow explained !

Regards.

Foreign investment is considered as favorable for the economy. What Mr. P. Chidambaram did was not really a bad move. Market crashed because of outflow of capital but it can always recover. I'm taking the long term benefits into consideration here. In a way, it's a positive sign for Indian investment banks, hedge funds, boutiques etc considering their future in the market.

If foreign investors invest in or capital markets or the reality sector (which they already did) will always help us grow. They have the capacity to make heavy investments. But they will make heavy profits and withdraw their capital. I'm not saying that is mean. It's simply business for them. This has happened. Eventually, all that capital will go back to London, NY or any other city from where they operate.

Why not let our Indian banks do the same? Most of that money will stay in India itself for few years atleast. It is not really wrong when our banks ask the government to tighten rules for international banks. It should be a fair game


This is what I feel. I guess few others might have some different opinion and I'd like to understand them.

Cheers!

[Tumtum]

Originally Posted by D i g i S y n c

Foreign investment is considered as favorable for the economy. What Mr. P. Chidambaram did was not really a bad move. Market crashed because of outflow of capital but it can always recover. I'm taking the long term benefits into consideration here. In a way, it's a positive sign for Indian investment banks, hedge funds, boutiques etc considering their future in the market.

If foreign investors invest in or capital markets or the reality sector (which they already did) will always help us grow. They have the capacity to make heavy investments. But they will make heavy profits and withdraw their capital. I'm not saying that is mean. It's simply business for them. This has happened. Eventually, all that capital will go back to London, NY or any other city from where they operate.

Why not let our Indian banks do the same? Most of that money will stay in India itself for few years atleast. It is not really wrong when our banks ask the government to tighten rules for international banks. It should be a fair game


This is what I feel. I guess few others might have some different opinion and I'd like to understand them.

Cheers!

IMO,
the move by PC was not at all wrong. He just wanted to rein in the "hot money" that was jacking the Sensex and Nifty and the stop that he took for it was but logical.

In fact he did this to prevent another South-East Asian crisis in waiting. Remember what had happened with the South-East Asian economies of Malaysia, Thailand, Indonesia at the turn of the century?


As such it definitely makes sense to rein in the hot money that comes into the economy because such money always creates asset bubbles....at the turn of the century it was the IT bubble and then came the bubble in valuing "India's Growth Story" which led to the markets growing from 5000 pt levels in 2004 to 22000 pt level in 2008. Can you imagine any market growing 4 times in size in a 4 year period.

Currently most of the top economists at big Ibanks opine that India is grossly overvalued and tend to keep away from investing in India.

To top it, we have our own inflation woes and to control it the RBI is jacking up interest rates. As such these inflation figures are totally fudged and just look at the irony....government wants to bring down the inflation rate from 11.89% to 6-7% level by the year-end....just in time for elections.


These jokers are playing around with our economy, hope some good sense prevails in them.

[Tumtum]

This is crazy folks.......look at how we still don't know the extent of sub-prime related liquidity crunches...one more victim- IndyMac Bancorp Inc (Bloomberg: IDMC US Equity)

Indymac is second-largest independent mortgage lender in the U.S.
It has been forced to curtail lending and has filed for bankruptcy after a run by depositors left it severely short on cash.
IndyMac will today file for bankruptcy in a California court, seeking relief under Chapter 7 of Title 11 of the U.S. code.

Just think of this folks....IDMC was trading at one point of time in 2006 at $50/shr and now its current price in pre-market open has dropped to just $0.13 (or 13 cents) !!! Hey bhagwan !

I will share more such information regarding all global/regional markets as and when it comes.

Cheers !

[Tumtum]

Sab chup kyon ho gaye?
2 mahine chup reh kar 3rd thread kholna hai kya (Investment Banking....Yes Yes Yes Again) ?

Let us continue discussions folks ! Dont let the thread die again !

[Oxymoron]

Interesting thread but how about actually discussing whether there is any "real method" to all this "madness"? I very very strongly recommend both the books " Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets "
and "The Black Swan: The Impact of the Highly Improbable " by Nassim Taleb. ( Thanks to Yogesh for recommending me this! ) . I wouldnt exactly claim these books were "life changing" but they did give moral sanction to certain perspectives I have held so far which made "sense" and reconsider some other things.

Notwithstanding the ponderous style of the author ( am not complaining...have been accused of the same so can identify with the author ) the points made in the books are simply brilliant! And very very relevant to the investment banking industry. Mind you this is no "Liar's Poker" but will give you a fresh perspective on that book again.

Girish...!