Skip to main content
MENU
Subscribe
  • Login
  • My Account
  • Logout
  • Register For Free
  • Subscribe
  • Topics
    • Alternatives
    • Artificial Intelligence
    • CIOs
    • Consultants
    • Defined Contribution
    • ESG
    • Face to Face
    • Hedge Funds
    • Industry Voices
    • Investing
    • Money Management
    • Partner Content
    • Private Credit
    • Pension Funds
    • Private Equity
    • Real Estate
    • Regulation
    • Special Reports
    • Washington
    • White Papers
  • International
    • U.K.
    • Canada
    • Europe
    • Asia
    • Australia - New Zealand
    • Middle East
    • Latin America
    • Africa
  • Rankings & Awards
    • 1,000 Largest Retirement Plans
    • Top-Performing Managers
    • Largest Money Managers
    • DC Money Managers
    • DC Record Keepers
    • Largest Hedge Fund Managers
    • World's Largest Retirement Funds
    • Best Places to Work in Money Management
    • Excellence & Innovation Awards
    • WPS Innovation Awards
    • Influential Women in Institutional Investing 2024
    • Eddy Awards
  • Resource Guides
    • Active Thematic Global Equities
    • Retirement Income
    • Fixed Income
    • Pension Risk Transfer
    • Pooled Employer Plans (PEPs)
  • ETFs
    • Latest ETF News
    • Fund Screener
    • Education Center
    • Equities
    • Fixed Income
    • Commodities
    • Actively Managed
    • Alternatives
    • ESG Rated
  • ESG
    • Latest ESG News
    • The Institutional Investor’s Guide to ESG Investing
    • ESG Sustainability - Gaining Momentum
    • ESG Investing | Industry Brief
    • Innovation in ESG Investing
    • ESG Rated ETFs
    • Divestment Database
  • Defined Contribution
    • Latest DC News
    • The Plan Sponsor's Guide to Retirement Income
    • DC Money Manager Rankings
    • DC Record Keeper Rankings
    • Innovations in DC
    • DC Plan Design: Improving Participant Outcomes
  • Searches & Hires
    • Latest Searches & Hires News
    • Searches & Hires Database
    • RFPs
  • Research Center
    • The P&I Research Center
    • Earnings Tracker
    • Endowment Returns Tracker
    • Corporate Pension Contribution Tracker
    • Pension Fund Returns Tracker
    • Pension Risk Transfer Database
  • Careers
  • Events
    • View All Conferences
    • View All Webinars
  • Print
Breadcrumb
  1. Home
  2. REGULATION AND LEGISLATION
November 09, 2016 12:00 AM

Hedge fund managers expect more deregulation under Trump

Christine Williamson
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print
    Spike Liseiko
    Sir Michael Hintze

    Hedge fund managers, true to form, have been quick to assess the impact of Donald J. Trump's impending presidency on global markets and their own investment strategies.

    Most hedge fund chiefs expect continued U.S. economic growth within a deregulatory environment and possibly uneasy relations between the Republican president and the Republican majority in the Senate and the House of Representatives.

    “I think it unlikely the U.S. economy will be derailed,” said Sir Michael Hintze, CEO, senior investment officer and a portfolio manager, CQS (UK), London, in a statement.

    “Market attention will also now turn to Europe ahead of the Italian (constitutional) referendum and the French and German elections — anything is now possible. While volatility is the name of the game, credit provides some attractive opportunities,” Mr. Hintze added.

    Mr. Hintze focused on the likelihood that Mr. Trump's presidency will feature “more deregulation than at any other time since (Ronald) Reagan's presidency is certainly on the agenda,” but he also noted that “Donald Trump was always an outsider. He had minimal support from the Republican Party and therefore has minimal obligation to them. Of particular interest will be how a Republican Senate and Congress will work with the new president.”

    CQS manages $12 billion in multistrategy and credit hedge funds and long-only strategies.

    Jens Foehrenbach, deputy chief investment officer of hedge funds-of-funds manager Man FRM noted in an e-mail that “one of the attractions of the new political leadership seems to be that they are not part of the establishment (and) as such, there is a higher degree of uncertainty surrounding likely future actions.”

    He added that the increased uncertainty going forward could lead to a period of higher market volatility and new correlation regimes which “may give hedge funds a chance to prove their value in portfolios as investments that aim to be uncorrelated to markets and seek to provide alpha in uncertain environments in particular. I believe that systematic strategies that run diversified books across asset classes have an advantage over hedge funds that run concentrated positions,” Mr. Foehrenbach said.

    Man FRM manages $12.8 billion in hedge funds of funds and customized hedge fund portfolios.

    “In general, a lower-regulation environment should be good for more deal-making,” said John Melsom, chief investment officer of Omni Partners' $350 million Omni Event Fund, a traditionally managed event-driven hedge fund, in an e-mail.

    Mr. Melsom said he thinks there may be increased activity in health-care stocks “since a Hillary win was seen as a negative due to her pushing for increased regulation and pricing caps on drugs.”

    “On the other side of the coin, Trump will be more protectionist from a foreign investment point of view, so we expect Chinese inbound investments to face more pushback than they did under Obama,” Mr. Melsom added.

    Hedge fund manager David M. Einhorn decided against making tactical changes in his portfolio to prepare for market volatility tied to the results of U.S. elections, according to Bloomberg.

    “I'm sure it matters to a lot of the holdings. It's not clear when it matters to the portfolio as a whole, however. The portfolio is a mix of longs and shorts, and I'm sure various securities will be impacted in different ways,” Mr. Einhorn said during an earnings call Tuesday discussing results for Greenlight Re, the offshore reinsurer for which he serves as chairman.

    Mr. Einhorn also is president and director of Greenlight Capital Inc., which manages $8.6 billion in hedge funds, including for the firm's affiliated reinsurer.

    By contrast, Daniel S. Loeb, founder and CEO, of hedge fund manager Third Point, said he had reduced some positions and increased hedges because of concerns that election-related surprises could rattle financial markets, during a Nov. 3 earnings call for offshore affilitate Third Point Reinsurance, Bloomberg reported.

    Third Point manages $16 billion in hedge funds, including the assets of its reinsurance affiliate.

    Kenneth J. Heinz, president of industry tracker Hedge Fund Research, said he is “extremely positive. There’s no question that the Trump administration is more pro-business, and that’s going to be good for the broader U.S. economy.”

    The hedge fund industry will benefit as economic and market conditions improve, Mr. Heinz said, adding that as interest rates are allowed to rise normally — “which we haven’t seen for some time” — global markets will be easier for hedge fund managers to make money in.

    As markets further normalize, equities will continue to rise and correlations between individual stocks likely will fall, providing hedge fund managers with more opportunity to exploit differences to produce alpha, Mr. Heinz said.

    Bloomberg contributed to this story.

    Related Articles
    Hedge fund invasion of U.S. Treasuries puts bond traders at risk
    SEC proposal challenges liquid alternatives funds
    FSOC to scrutinize leverage in hedge funds
    Stocks, futures and currencies roiled by Trump presidential election victory be…
    Most investors sticking with hedge funds; management fees fall in 2016 — survey
    How pension plans can build the case for hedge funds
    Recommended for You
    Houses of Parliament
    U.K. government looks to launch consolidator for small retirement plans
    U.K. banknotes and coins.
    U.K. government planning deregulation for alternatives managers
    Headshot of Daniel Aronowitz
    In a personal blog, Trump's EBSA nominee calls for a special ERISA court to reduce legal uncertainties
    Sponsored
    White Papers
    The State of Lifetime Income Report
    The Next Wave of LDI Evolution
    Retirement security to future income wins, TIAA brings you the latest financial…
    U.S. Public Funds Top Performers: Q2 2024
    Generative AI Investing: Opportunities at a Key Tech Inflection Point
    Research for Institutional Money Management: Advancing Physical Risk Modelling,…
    View More
    Sponsored Content
    Partner Content
    The Industrialization of ESG Investment
    For institutional investors, ETFs can make meeting liquidity needs easier
    Gold: the most effective commodity investment
    2021 Investment Outlook | Investing Beyond the Pandemic: A Reset for Portfolios
    Ten ways retirement plan professionals add value to plan sponsors
    Gold: an efficient hedge
    View More
    E-MAIL NEWSLETTERS

    Sign up and get the best of News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today
    October 23, 2023 page one

    Get access to the news, research and analysis of events affecting the retirement and institutional money management businesses from a worldwide network of reporters and editors.

    Subscribe
    Connect With Us
    • RSS
    • Twitter
    • Facebook
    • LinkedIn

    Our Mission

    To consistently deliver news, research and analysis to the executives who manage the flow of funds in the institutional investment market.

    About Us

    Main Office
    685 Third Avenue
    Tenth Floor
    New York, NY 10017-4036

    Chicago Office
    130 E. Randolph St.
    Suite 3200
    Chicago, IL 60601

    Contact Us

    Careers at Crain

    About Pensions & Investments

     

    Advertising
    • Media Kit
    • P&I Custom Content
    • P&I Careers | Post a Job
    • Reprints & Permissions
    Resources
    • Subscribe
    • Newsletters
    • FAQ
    • P&I Research Center
    • Site map
    • Staff Directory
    Legal
    • Privacy Policy
    • Terms and Conditions
    • Privacy Request
    Pensions & Investments
    Copyright © 1996-2025. Crain Communications, Inc. All Rights Reserved.
    • Topics
      • Alternatives
      • Artificial Intelligence
      • CIOs
      • Consultants
      • Defined Contribution
      • ESG
      • Face to Face
      • Hedge Funds
      • Industry Voices
      • Investing
      • Money Management
      • Partner Content
      • Private Credit
      • Pension Funds
      • Private Equity
      • Real Estate
      • Regulation
      • Special Reports
      • Washington
      • White Papers
    • International
      • U.K.
      • Canada
      • Europe
      • Asia
      • Australia - New Zealand
      • Middle East
      • Latin America
      • Africa
    • Rankings & Awards
      • 1,000 Largest Retirement Plans
      • Top-Performing Managers
      • Largest Money Managers
      • DC Money Managers
      • DC Record Keepers
      • Largest Hedge Fund Managers
      • World's Largest Retirement Funds
      • Best Places to Work in Money Management
      • Excellence & Innovation Awards
      • WPS Innovation Awards
      • Influential Women in Institutional Investing 2024
      • Eddy Awards
    • Resource Guides
      • Active Thematic Global Equities
      • Retirement Income
      • Fixed Income
      • Pension Risk Transfer
      • Pooled Employer Plans (PEPs)
    • ETFs
      • Latest ETF News
      • Fund Screener
      • Education Center
      • Equities
      • Fixed Income
      • Commodities
      • Actively Managed
      • Alternatives
      • ESG Rated
    • ESG
      • Latest ESG News
      • The Institutional Investor’s Guide to ESG Investing
      • ESG Sustainability - Gaining Momentum
      • ESG Investing | Industry Brief
      • Innovation in ESG Investing
      • ESG Rated ETFs
      • Divestment Database
    • Defined Contribution
      • Latest DC News
      • The Plan Sponsor's Guide to Retirement Income
      • DC Money Manager Rankings
      • DC Record Keeper Rankings
      • Innovations in DC
      • DC Plan Design: Improving Participant Outcomes
    • Searches & Hires
      • Latest Searches & Hires News
      • Searches & Hires Database
      • RFPs
    • Research Center
      • The P&I Research Center
      • Earnings Tracker
      • Endowment Returns Tracker
      • Corporate Pension Contribution Tracker
      • Pension Fund Returns Tracker
      • Pension Risk Transfer Database
    • Careers
    • Events
      • View All Conferences
      • View All Webinars
    • Print