Gazprom CEO Sounds Alarm on European Energy Crisis (Bloomberg)
BofA Global Fund Manager Survey Reveals Significant Tail Risks Exist
For quite some time, Fund Managers have kept a close pulse on the global economy and the key issues that effect broader markets. In a survey of roughly 250 fund managers, Bank of America reports a consensus of what the group believes is the "biggest tail risk" to global economies. Since last spring, rising inflation and a broadening hawkish stance by a number of Central Banks has topped the list. At this point in time, all U.S. major indices are in a bear market and the FED is having to recalibrate its quantitative tightening efforts after incorrectly labelling inflation as "transitory". While markets have quickly rebounded following recent drops, general consensus is that this newest retraction will likely require a longer recovery time.
"Even though the S&P 500 is down over 23% year to date, 9 single days make up that entire decline."
Nicholas Colas, DataTrek
Private Funding Pulse Check
Stairwell, a cybersecurity platform solution, has closed on a $45M Series B round that included Menlo Park, CA-based Single-Family Office Hillspire
The Late Paul Allen's Family Office, Cercano Management has participated in a Series C round that totaled $17.5M for Genetesis, a medical equipment manufacturing company that produces medical imaging devices
Peterson Partners engaged in a Series A investment with Trendsi, a B2B marketplace that provides inventory, dropshipping and back-end infrastructure support, totaling $25M
Square Peg Capital took part in a $100M Series E deal with Airwallex, the leading financial technology payment platform for modern businesses
Long-Short Hedge Funds Produce Underwhelming Returns
Since the inception of the first hedge fund nearly 75 years ago, hedge funds have promised investors extraordinary returns in exchange for high fees. More specifically, long-short hedge funds sought superior returns from not just their high conviction stock picks but also their short positions in companies they believed were over priced. However over recent years, many hedge fund LPs have grown sour due to disappointing returns, in some situations underperforming broad index funds. Experts predict multi-strategy funds, ones that invest over multiple asset classes and typically diversify heavily, will soon overtake long-short strategy funds. This year alone, stocks favored amongst hedge funds were down 31%, while the most common short positions dropped only 20%. The result is more than half of long-short funds down at least 10% this year and 80% of the group reporting losses.
IMF Updates its Economic Growth Forecast Amidst Global Slowdown
In a report from the International Monetary Fund (IMF), the group provided an update to its global growth forecast and world economic outlook (WEO) for the remainder of 2022 and 2023. The IMF's global GDP forecast remained unchanged at 3.2% for the current year, however its projection for 2023 was lowered to 2.7%, a 0.2% reduction from the July report. In addition to producing WEO forecasts, the IMF provided clarity on inflation, expecting a peak of 9.5% before decelerating to 4.1% by 2024. Downside risks remain abundant, as policy miscalibration, inflation and the Ukraine War all add to the possibility of a deeper recession. Other notable factors addressed in the IMF update included weakening real income and a surging U.S. dollar putting pressure on foreign currencies.
"The 2023 slowdown will be broad-based, with countries accounting for about one-third of the global economy poised to contract this year or next. The three largest economies, the United States, China, and the euro area will continue to stall. Overall, this year’s shocks will re-open economic wounds that were only partially healed post-pandemic. In short, the worst is yet to come and, for many people, 2023 will feel like a recession."
IMF
Singapore Family Office Supports Early-Stage Sustainable Ventures
The Rumah Group, a single-family office based in Singapore, has emerged as a leading figure in early-stage sustainable investments throughout Southeast Asia. The group was established to manage the wealth of the Tan Family, whose wealth stems from a successful international real estate business. Today the firm has nearly ten VC investments, including both fund and direct transactions that span the waste reduction, childhood development and "eco-hotel" spaces. When measuring the impact of the firm's ESG investments, the Tan family said it takes a similar approach to its philanthropic assessment. The firm believes there should be increased policing of ESG marketing, and offered the idea of a deal aggregator that curates a receptacle of previously vetted companies, providing the added benefit of reduced search times.
"So I think there is an opportunity there, whether it's family offices, whether funds, to deploy that little bit earlier, which might mean higher risk, but then actually spread the risk on your investments to get that early traction."
Newport Beach, CA-based SageView Advisory Group, one of the leading independent RIA firms, has acquired Lakeview Wealth Management and their $415M worth of assets (Cision)
Piper Sandler has completed its acquisition of DBO Partners, an independent technology investment banking firm based in San Francisco, CA (BW)
Savant Wealth Management has acquired a pair of wealth management firms based in Iowa that together oversaw $730M in assets (FAIQ)
Written by:
Andrew Popp | Data Research Associate
FINTRX delivers an industry-leading suite of private wealth data and research solutions to the alternative investment space and private capital markets. Engineered to help clients identify and access family office and RIA capital intuitively, the FINTRX platform ensures accurate and updated data and research on 850,000+ private wealth records globally. To subscribe to our newsletter and see previous versions click below.
