yes hedgie has returned from the HC sin bin! thats now 100 times! wooohoooooo .I. mods :)
i added to my shorts at 5720 on 12th feb now holding shorts from 6000, 5850,5750,5720......its make or break time for me ;)
nervous? with this sort of back up news to fuel the new pessimism in the market? NOPE
Citigroup shuts London fund to withdrawals
February 15, 2008 Angela Jameson
Citigroup has moved to stop investors withdrawing their money from one of its London-based hedge funds after panic selling that saw investors try to pull out more than 30 per cent of the fund's $500 million (£254.3 million) assets.
The bank has suspended redemptions in CSO Partners, a fund run from a Berkeley Square address which specialised in corporate debt and which lost 11 per cent last year, according to The Wall Street Journal.
Last month Citigroup injected $100 million into the fund to stabilise it.
John Pickett, the fund's long-term manager, has also departed after a dispute with Citigroup executives and complaints from investors that he put too much money into a single investment that went bad.
Alternative-investment products such as hedge funds have been a relatively new venture for Citigroup and remain a small part of the business.
Of the bank's $2.4 trillion assets, only $61.9 billion is invested in alternative products, of which about $11.5 billion represented Citigroup's own capital.
The problems at CSO Partners represent another embarrassment for the world's biggest bank as it tries to recover billions of dollars of losses related to sub-prime investments.
Vikram Pandit, the new chief executive if Citigroup, briefly ran the alternative-investments group, and some of the funds he oversaw have been struggling.
A large Citigroup hedge fund called Falcon Strategies suffered a 30 per cent decline last year as bets on the credit markets backfired.
Old Lane Partners, a hedge fund now run by Citigroup that was founded by Mr Pandit and other former Morgan Stanley executives, has also performed poorly, posting a 1.8 per cent loss in January.
The weak performance by CSO Partners and other Citigroup hedge funds contributed to an 89 per cent decline in fourth-quarter net income by the bank's alternative-investment unit.
Its profit fell to $61 million from $549 million a year earlier.
CSO, which stands for Corporate Special Opportunities, was started in 1999 with Citigroup's own capital.
In 2004 it began accepting money from outside investors, such as pension funds and wealthy individuals.
Those investors now account for most of the fund's assets.
Since its start, the hedge fund has been run by Mr Pickett, who in the late 1980s joined Salomon Brothers, now part of Citigroup, as a bond analyst in New York.
CSO compiled a solid track record investing in European and US corporate debt and had gained about 27 per cent since opening to outsiders.
Citigroup followed other investment banks into the hedge fund industry this decade as the funds boomed.
The banks bought stakes in existing funds and started some of their own in the hope of grabbing some of the cash pouring into these funds from large institutions.
Investment banks also wanted in-house alternative-investment products — with their lucrative management fees — to offer to their wealthy individual clients.
Within weeks of Mr Pickett's departure, anxious investors were trying to pull their money out of CSO.
In a letter to investors explaining the bar on withdrawals, the new fund manager said that if the fund honoured all the requests for redemptions, it would have to sell valuable assets at deep discounts.
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