Institutional Investor and Alpha Present the 14th Annual MARHedge Global Hedge Fund Summit
Keynote Speaker: Dr. Alan Greenspan
The Fairmont Southampton, Bermuda
Golf Tournament - Belmont Hills Golf Club
Hole-In-One Prize: Flexjet 25 card (25 hours on a Learjet 45)
Sailing Excursion
Tennis Tournament
Registration Opens - Refreshments Sponsored by Orrick
Welcome Cocktail Reception, Poolside - Sponsored by Flexjet
After Party - Sponsored by Fidelity Prime Services
Breakfast - Sponsored by Butterfield Bank
Conference Opening & Welcoming Remarks
Toby Crabel - Chief Executive Officer and President, Crabel Capital Management: The Value of Short-Term Trading During Crises
Since founding Crabel Capital Management in 1987 (originally as Toby Crabel & Co.), Mr. Crabel has established a consistent trading record that has been maintained through all market cycles and disruptions while continuing to increase assets under management, which now stand at more than $3.3 billion (including notional equity). Among his most notable achievements is producing positive returns in his core strategy without having a losing year since the program’s inception. Mr. Crabel’s views on trading and markets are well respected and recognized by professional traders as well as those who aspire to be, as illustrated by the continuing demand for his now out of print book, Day Trading with Short-Term Price Patterns and Opening Range Breakouts,. Mr. Crabel will share how he adapted his management approach over the years to sustain his performance and ensure the continued growth of his firm as well as outline his views on the markets and developments he sees on the horizon as a result of current and evolving market trends and conditions. Mr. Crabel will share his views on both on the broader value of short-term trading strategies during periods of severe market turmoil generally, as well as offer his perspective on applying short-term trading techniques during the recent upheavals that resulted from the dislocations in the credit markets.
Hedge Fund Attributes: Understanding the Demands and Expectations of Institutional Investors
What lessons can or should hedge funds take away from the recently ended market cycle in which their average performance was lackluster enough to raise important and significant questions in the minds of investors? As was clear to many observers, a majority of hedge funds held heavily net long positions during the broad equity market downturn, and performance suffered as a result. What does this suggest about the ability of most hedge funds to take and to manage short positions? What needs to be weighed as it relates to different market cycles and strategies? How should this inform hedge funds as it concerns managing their risks and serving their clients? How can clients be made to feel comfortable in both making and sticking with an investment during varying market periods? This session will provide views from an experienced group of institutional hedge fund investors on what they have learned from their recent experiences, the expectations they now have, and what managers need to consider in order to continue serving their interests.
Perspectives on the Influences and Trends in the Global Credit Markets
Professor Edward Altman is considered one of the world’s leading experts on corporate finance, bankruptcy and reorganization,whose research and experience has given him an international reputation as an authority on high yield bonds, distressed debt and credit risk analysis. Professor Altman will provide a comprehensive view of the credit markets, putting into perspective how record levels of global liquidity and growth in the trading of sophisticated trading instruments is influencing rates and returns, and what events such as the subprime lending crisis may portend for both the broader market and distressed securities investors in particular. Professor Altman will also examine the risk and return profile of the high yield market and offer an outlook on default rates.
Professor Altman will be Introduced by:
Ron S. Geffner
Partner
Sadis & Goldberg LLP
Coffee Break
Strategies Track: Making it to the Next Level - What it Takes in Today’s Market
A number of recently published reports have reaffirmed that the concentration of assets in the top 50-100 hedge fund and fund of funds firms is growing at an accelerated rate, with some reports indicating that the top 50 firms are growing at a rate twice that of the smaller funds. This session will examine this trend from the perspective of trying to understand the reasons for this continued success in order to provide useful guidance to firms seeking to raise seed capital or those attempting to attract enough capital to reach the next level of growth. The panelists will both define key criteria necessary to raise capital in today’s market as well as outline how standards have evolved as institutional demands have established minimum requirements and raised expectations.
Business Operations Track: And Where Will It All Lead? Defining the Hedge Fund and Fund of Funds Business Model of the Future
There is no longer any real debate about hedge funds becoming part of the mainstream asset management industry. With an estimated $2 trillion now under management, an expansion into new product areas and sectors such as private equity and long-only fund offerings, and business models for growth that include adopting multi-strategy platforms, going public and selling stakes to far larger entities, hedge funds and funds of funds can be seen to have arrived. Clearly there is no one formula to for success. But what do these developments—and the experience of hedge funds and funds of funds to date—suggest might be the best way to succeed going forward? If one size can’t fit all and different business models can work just as well as others, how can hedge funds and funds of funds determine the best direction for them?
Governance, Risk and Compliance Track: Implementing Compliance Policies and Procedures for Effective Results
Regulatory compliance has grown ever more complex for hedge funds as they have attracted more scrutiny and scrambled to ensure they have properly trained personnel in place to ensure that appropriate policies and procedures are both implemented and followed. But many hedge funds without sufficient resources to retain a full-time compliance officer may frequently rely on another senior executive to fulfill that role. However, no matter what the background and experience of those given responsibility for this vital function, understanding the nuances of the many rules that must be followed to avoid regulatory problems can be both difficult and open to debate. In this session, the Regulatory Compliance Association will feature prominent experts to provide a practical and applicable appreciation of key compliance issues hedge funds need to understand in order to remain free of undue regulatory inquiries.
Produced by: The Regulatory Compliance Association/CCO University
Lunch
A Conversation with Dr. Alan Greenspan
Dr. Alan Greenspan probably requires no introduction. As the former Chairman of the Board of Governors of the Federal Reserve System for a period spanning eighteen and a half years, beginning in 1987 and ending in 2006, Dr. Greenspan’s terms covered four presidential administrations. During this period, through both bull and bear markets his analysis of economic trends for the long- and short- term influenced and often shaped the course of policy, international relations and financial markets. Through his steady leadership the Fed became an institution respected worldwide. Through thoughtful, in-depth question-and-answer sessions, listeners will better understand the issues affecting their future and the future of the world economy.
Coffee Break
Strategies Track: India - Understanding the Real and Perceived Investment Opportunities and Risks
Among the so-called BRICs of Brazil, Russia, India and China, India’s long-term trends have been cited as the most promising. Speakers in this session will provide some of the developments that have shaped that view and discuss what it takes for managers to succeed in India today as well as outline the barriers and risks that must be overcome and managed.
Business Operations Track: What it Takes: The Key Attributes Hedge Funds and Funds of Funds Seek from Their Service Providers
Each year, Alpha magazine asks hedge funds and funds of funds to respond to an annual survey to determine the best service providers in the industry in the areas of trading, legal, fund administration and prime brokerage. This detailed poll not only identifies the top service providers but also reveals a number of the important qualities that make hedge funds rank them so highly. Last year more than 1,100 hedge funds and funds of funds responded to the survey and more are expected to respond this year. In this session a sneak preview of the results will be revealed for the first time and a panel discussion will examine the key attributes hedge funds and funds of funds are seeking from service providers, how their needs are being met and where they believe service providers could improve on what they are delivering.
Governance, Risk and Compliance Track: Managing and Mitigating Compliance Risk
Regulatory compliance dictates that a firm’s primary responsibility comprises mitigating risk, especially during periods of increased regulatory scrutiny and litigation. As the regulatory and litigation environments continue to escalate, hedge funds, funds of funds and investment advisors must continually re-examine regulatory and litigation risk. In order to manage risk, firms must periodically assess, evaluate and review the complex set of relationships between personnel, third parties, systems, documentation and internal controls. The CCO University faculty designed this panel to assist firms in analyzing the complex series of activity as well as the design and development of a comprehensive internal control structure, including:
• Advertising and Marketing
• AML
• Valuation
• Books and Records
Produced by: The Regulatory Compliance Association/CCO University
Cocktail Reception
Breakfast - Sponsored by Nova Scotia, Canada
Opening Remarks
Louis C. Gerken, Chairman and Chief Executive Officer - Gerken Capital Associates
The Emerging Markets Era: Understanding the Opportunities, Risks and Complexities
Returns from emerging markets investments have exceeded many expectations over the last several years while the traditional volatility, opaqueness and skepticism about their long-term prospects has ebbed due to perceived better economic and monetary policies, increased trade and improved communications. But risks may remain higher than may often currently be recognized as much information remains closely held or provided only under pressure, the rule of law is still frequently applied arbitrarily and inconsistently, common financial and accounting standards are vary extensively and state interference and cronyism continues to be widespread. In addition, of course, problems related to language and cultural barriers exist while geographic distance adds yet another set of obstacles.
As a longtime investor in emerging markets Lou Gerken has gained an intimate understanding of the difficulties, complexities and multiple issues managers must contend with in pursuing profits in those regions—and gained first-hand experience in how managers have successfully dealt with many of the unique impediments with which they must contend. Mr. Gerken will explore a number of the most significant issues hedge fund managers must consider when investing in emerging markets and outline a strategy for building traction in those markets by allocating to single managers, using examples of successes and disappointme
It’s a Family Affair: Serving the Affluent Investor
The personal stakes highly affluent individuals have in the investments they make, combined with the family dynamics they frequently have to contend with, creates a unique set of circumstances hedge funds and funds of funds must grasp to properly serve this still important—and still growing—market. A demand for more personalized service, and knowing how to provide it, is one consideration that must be taken into account. Appreciating that there are often wide gaps among family members in their understanding of finance and investing options, as well as in their individual risk tolerances, is another. Speakers in this session will offer insights into these and other issues in an effort to explain and illustrate client marketing and servicing approaches that can help hedge funds and funds of funds attract and retain assets from affluent investors.
Strategies Track: New Directions in Active Management - Is 130/30 the Beginning of a Larger Trend?
Active extension products have been viewed as an example of the next generation in asset management in which traditional style/asset buckets are re-evaluated and techniques pioneered by hedge funds are made available to a broader group of investors or used more broadly by current hedge fund investors. The prime example is the growing interest in 130/30 and similarly named strategies by many institutional investors, as well as the increasing number of new fund launches to serve this demand. Speakers in this session will consider why hedge fund management companies may want to offer such products, discuss the ingredients necessary for success, and highlight the operational and marketing issues involved in pursuing the development of them.
Business Operations Track: Why Can’t We be Friends? Reflections on the Role and Influence of the News Media
Is the news media a friend or foe of the hedge fund industry-or is that simply the wrong way to think about its role and, more importantly, to understand it? Hedge fund executives struggle with comprehending the media and how to deal with it and consistently perceive that it has a built-in agenda that includes a negative view of their industry. But are those views any different than the opposing opinions between an activist fund manager targeting a company considered to be undervalued and the targeted company that feels it is being unfairly singled out? This session will provide viewpoints directly from news media representatives themselves and offer the audience an opportunity to ask the questions many may have wanted to ask but never had the chance to until now.
Governance, Risk and Compliance Track: What’s it Worth? Identifying the Issues and Best Practices in Securities Valuations
Two years ago, a group headed by former New York Federal Reserve President Gerry Corrigan issued a report on policy recommendations in response to concerns about the growth in the issuance and trading of credit derivatives. But while most of those recommendations were adopted, many of the issues identified in the report remain as the result of further growth in the number of instruments traded as well as the number of those participating in the sector. Fundamentally, the primary issue is related to ensuring that less liquid instruments are properly priced and that counterparties are using reliable standards and procedures in valuing them. A variety of observers have called this a thorny and perhaps unsolvable problem, but speakers in this session will outline the key issues and discuss how hedge funds can continue addressing them to reduce systemic risks.
Coffee Break
Strategies Track: Emerging Managers: Developing the Right Strategy to Attract, Retain and Serve Clients
With the vast share of capital managed by a relatively small universe of hedge fund managers who continue to attract the lion’s share of new allocations, standing out from the crowd and garnering real attention from investors can be a difficult, if not daunting task for emerging managers short on resources. This session will focus on some of the key attributes investors are seeking from emerging managers in a competitive environment and explain how they can play an essential role in attracting and retaining clients.
Business Operations Track: Compensation Practices - Developing the Right Model
Russ Prince has studied and researched compensation models for a variety of highly compensated executives and professionals, both to help define what reasonable or average levels of pay are in particular industries as well as to provide a better framework for understanding how to develop the right type of compensation packages to serve particular needs, whether by creating tax-advantaged pay structures or ensuring the correct level of salary and incentives to improve employee retention. In this session he will share exclusive research featuring examples of compensation packages at hedge funds that will provide models and guidelines for managers to consider in order to best serve the interests of their clients, themselves and their employees. In addition, a number of compensation trends will be highlighted from a new hedge fund compensation survey conducted by Alpha magazine, which is also well known for the Alpha Rich List featuring the 25 most highly compensated hedge fund managers in the industry.
Governance, Risk and Compliance Track: SEC Enforcement Actions
This session will provide an overview of the SEC Division of Enforcement and the types of cases usually subject to investigation. The characteristics of informal and formal investigations will be provided and discussed and extensive consideration will be given to the steps a firm must consider when responding to an SEC investigation—including in-depth coverage of the Wells process. There will also be discussion regarding the process of gaining approval for enforcement actions and federal court actions, including injunctive relief, civil fines and disgorgement. SEC administrative proceedings will also be covered, including administrative remedies, appeals to the Commission and judicial reviews.
Produced by The Regulatory Compliance Association/CCO University.
Secondary Strategies Track: The Outlook for Technology: Identifying the Trends and Sectors to Generate Profits
Technology spending and development continues to be a key indicator of economic trends and represents a sector where significant investment opportunities and risks always exist. What does the current macroeconomic climate suggest about information technology spending, particularly in the semiconductor sub-sector? What are the themes and new product offerings that will have the biggest impact on IT spending? And how will these developments influence the stock market and technology stocks in particular?
Strategies Track: Convertible Arb: Lessons on Surviving Extreme Market Cycles
Convertible arbitrage was a strategy that was essentially written off not long ago, with many observers suggesting it would not and could not be resurrected. Over the last year or more, however, convertible arb returns have experienced a remarkable recovery and are again attracting investors’ interest. This session will examine whether this trend is sustainable and will identify the factors likely to impact the market and discuss what managers can or should do to retain investors when strategies fall out of favor.
Business Operations Track: Convergence - Where is the Merging of Hedge Fund and Private Equity Strategies Headed?
The convergence between hedge funds and private equity funds continues unabated—as does the debate about its implications and consequences. Is this a model other hedge funds should emulate? Are the perceived benefits of longer lockups outweighed by other factors? Are there advantages to maintaining a more traditional hedge fund structure? Speakers in this session will examine these issues in an attempt to identify those factors hedge funds should consider in contemplating whether this is a business model they should adopt to serve their clients.
Governance, Risk and Compliance Track: Convergence of Regulatory Compliance and Risk Management
Regulators continue to expand their oversight beyond legal and compliance related risks into a firm’s risk management function. Consequently, risk managers must adapt to the heightened regulatory focus, and expand their knowledge beyond traditional risk management issues. This panel will explore the escalating regulatory landscape’s impact upon risk managers, and how the risk management and compliance functions shall continue to interact and converge. The panel will address:
• Risk management policies and procedures
• Hedge fund leverage issues
• Trade surveillance
• Risk management issues turned regulatory
• Interacting with investors
• An International perspective
Produced by: The Regulatory Compliance Association/CCO University
Lunch
Commodities in Institutional Portfolios – Supply & Demand Dynamics: Where are the Opportunities and the Risks?
Commodities offer well-documented benefits for institutional portfolios, benefits like diversification and inflation hedging and the opportunity for higher returns. But these investments also have limitations such as increased volatility. As commodities investing has evolved in response to institutional demand, there has been a lot of product development on the active side so that investors can now gain commodity exposure through commodity-linked notes, swaps and futures. Which new investment strategies are available to better control risks? What new sectors and assets offer better risk-adjusted returns? What role is the hedge fund industry playing as both buyers and suppliers of commodities products and strategies?
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