Wednesday, August 8, 2012

How To Name Your Hedge Fund: Most Common Firm Names

Let's face it, many hedge funds follow a seemingly standard equation for naming their firm.  As such, we thought it would be fun to create an exercise: how to name your hedge fund.

Naming your hedge fund can be boiled down to a very simple formula:

Step 1.  Based on past precedent, your firm should be named after one of the following:

- Predatory animals. Real world examples: Tiger Management, Lion Fund. Suggested: Honey Badger Partners, because honey badgers don't give a shit.

- A tree (preferably a big one).  Ex: Oaktree, Lone Pine, Sequoia, Fir Tree.  Available: The Entire Rainforest LLC.

- Some type of rock or stone. Ex: BlackRock, BlackStone.  Options: F'n Massive Mountain Management, Tiny Pebble Partners 

- Character or place from books/stories/shows.  Ex. Atticus Capital, Valinor Management.  Suggestions: Cobra Commander Capital, Ninja Turtle Associates.  And for Seinfeld fans: Art Vandelay Capital Partners.

- Geographic Locations/Regions. Ex: Pershing Square Capital, Blue Ridge.  Possibilities: Egyptian Pyramind Scheme Partners, Arctic Circle Capital

- Bodies of water and bridges are also very popular. Ex: Pine River, SkyBridge.  OR you can combine them together for an uber-bonus: Bridgewater.  Unfortunately, WaterBridge is also taken.  Perhaps just combine them all: Stream Creek River Lake Ocean Bridge Associates.

- Historical figures/civilizations.  Ex: Argonaut Capital, Viking Global.  Available: Ming Dynasty Management, Honest Abe Advisors 

- Manager's name/initials.  The obvious: SAC Capital, Soros Management, Tudor Investment.  Possibilities: Stalin Securities, Not That Madoff Capital

- Greek Mythology/Greek Words.  Ex: Cerberus, Kynikos,  Suggested: Beard of Zeus Capital, Toga Partners

- Something that has no relevance to what you're doing (bonus points for words that people struggle to pronounce).  Options: Floccinaucinihilipilification Fund, Onomatopoeia Partners, Jai Alai Holdings

- Some type of castle or fort.  Ex: Citadel, Knight's Bridge.  Available: Hogwarts Holdings

Step 2.  Add one of the following to help describe what the firm does  (because let's face it, the name you just picked above has nothing to do with investing): Capital, Partners, Capital Partners, Advisors, Holdings, Capital Management, Asset Management, Investment Management, Funds, Associates, Securities, Trust, etc.

Step 3.  Tack on either LLC or LP at the end of the name, depending on whether it's the management company or the limited partnership.

And voila, you have a hedge fund name that will blend in seamlessly.   

If you have difficulty coming up with the perfect name, you can always turn to  Yes, that's a real thing.  It automatically spits out a random combination using the same formula outlined above.  Here are some of the names it generated for us:

- Solid Road Management: obviously to let investors know there will be NO bumps along the way

- Brown Tree Capital: not redundant at all

- Winter Field: no "Capital" or "Partners" at the end.  Just Winter Field.

- Yellow Brick Road Associates: OK, it actually was just Yellow Road Associates, but given the ridiculousness of some of the other names it generated, it might as well have been Yellow Brick Road.

This post has been all in good fun.  What are some of the ridiculous hedge fund names you've come across?  Let us know in the comments below!

TPG-Axon's Dinakar Singh Likes Sirius XM & Time Warner Cable: Interview

Dinakar Singh, CEO of $4 billion TPG-Axon Capital recently sat down with Bloomberg TV so we wanted to post up some of the highlights of his rare appearance.

It seems as though he is betting against telecom stocks and is also bearish on some financials (in particular US regional banks).  He's bullish on names like Sirius XM (SIRI), Time Warner Cable (TWC), and W.R. Grace (GRA).  He sees growth in the chemical, aerospace, and healthcare industries.

A graphic on screen showed TPG-Axon's key long exposures in tech & media: SIRI, TWC, Viacom (VIA.B), Kabel Deutschland, Equinix (EQIX), Expedia (EXPE), (PCLN), and Yandex (YNDX).

On the current environment:   “For us, we pick stocks. That is how we make money. More and more, everyone has become more emotional in markets. We get scared by headlines and we all start acting the same way whether you are a CEO or a consumer. Jobs do matter. I think when you look at the U.S. in the last number of months, our view coming in this year is that people got too excited. There was a bounce back from last year and some good weather but it was going to be a slow gradual sloppy messy restructuring without a big recovery. Things have reversed. I think people are getting too pessimistic…I think ultimately consumers and CEOs are reading the same headlines and scared. I think you are seeing a cyclical or temporary step down. We do not think there one should expect a big bounce, but there won’t be much of a plunge either. It feels like the numbers are crummy but they will probably stay this way for a while. The fiscal cliff is a real issue. I think you're seeing an impact right now.”  

On how to play this market:   “People have gotten scared and they’re paying a lot for safety. On the safety side, people like dividends in safe industries. So Verizon is trading 18 times earnings because people want safety and a good dividend. There are companies like Time Warner Cable that we think are just as defensive but they did not happen to pay a dividend, they have even better cash flow, but they traded as a result much less well last year. For us, big opportunity. So media and cable that’s very cash flow rich and where we think management is going to turn that spigot on and turn it into a dividend or buy back machine that makes sense. Sirius, Time Warner Cable, companies like that. On the cyclical side, not everything is terrible. There are some sectors where we think there is good structural growth and balance sheets will be put to work. Some chemical companies are very good restructuring candidates. Aerospace suppliers.  Aerospace is in the middle innings of a very long term upgrade cycle.”

On telecom services:   “In a hedge fund, this is called a funding short. It is not that you think it is terrible and going straight to 0, but it is priced fully and not going up much so not a very good risk reward. Within telecom services there are two categories. There are the Verizons, we get it, they trade here for a reason, but they are pretty fully priced. On the other side, there are other companies that are legacy telecom companies where the dividend is a very high, but business really is eroding. It is priced well today because of a high dividend, but it is not sustainable. When you look around the world, a lot of high dividend stocks in Europe are not trading well because people are looking at them and saying I get it. I have a dividend today but it might not be there tomorrow.”

On China:   “If you look at China specifically, multiples had really collapsed…You have two general types of companies. Big, state-owned companies that people don’t trust and private companies that people really don’t trust. There isn’t a lot that trades at big multiples anymore. I think if you can find cases where there is real growth and they can pay cash back to you, you’ll make money.”

Embedded below is the first part of the interview of Dinakar Singh's interview with Bloomberg TV:

And here's the second part:

What We're Reading ~ 8/8/2012

Best Buy founder looking for graceful, confusing exit [Dealbreaker]

Looks like JAT Capital is going back to its TMT roots [FINalternatives]

Mark Casella on future of the hedge fund industry [AllAboutAlpha]

Yale's David Swensen on asset allocation [Mutual Fund Observer]

Facebook's lock-up release problem [Business Insider]

Why Fidelity dumping Facebook is a bad sign for the market [LeighDrogen]

Joy Global: a misunderstood cyclical? [Rational Walk]

Some smaller hedge funds outshine their bigger rivals [Reuters]

The hot new mutual fund company you've never heard of [Forbes]

Hedge fund marketing implications from new survey [FINalternatives]

Do individual investors learn from their mistakes? [SSRN]

Profile on Five Guys Burgers [Forbes]

America's top colleges [Forbes]

Tuesday, August 7, 2012

Bill Ackman To Speak at the Value Investing Congress: Discount For Readers

It's just been announced that Pershing Square Capital Management's Bill Ackman will be presenting his next investment idea at the Value Investing Congress in New York City on October 1st and 2nd.  You can register here using MarketFolly's discount.

Ackman joins a list of big speakers including:

- David Einhorn (Greenlight Capital)
- Barry Rosenstein (JANA Partners)
- Alex Roepers (Atlantic Investment Management)
- Guy Gottfried (Rational Investment Group)
- Bob Robotti (Robotti & Co)
- Lloyd Khaner (Khaner Capital)
- Kian Ghazi (Hawkshaw Capital)
... and many more.

*** Discount:  As always, Market Folly readers can receive a 32% discount to the event by clicking here and using discount code: N12MF7.  Take advantage, because the offer expires in two weeks! ***