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Goldman Fund Up (And Also Down)

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I’ve always maintained that it pays to have a sugar daddy in the man Eliot Spitzer made the poster boy for his Wall Street witch-hunt in pursuit of Albany residency, and, if you can swing it, a Jew from Detroit, too. Case in point: Goldman’s previously floundering Global Equity Opportunities shot up 12 percent last week after the 85 Broads got a $1 billion pick-me-up from former AIG chairman Maurice “Hank” Greenberg and billionaire Eli Broad, in addition to $2 billion, from itself (by which we mean GSC, the bank. Let it go). In what some might regard as a nice recovery, assets more than doubled to $7.5 billion, after the fund lost approximately 30 percent earlier this month, due to some messiness in the mortgage sector.
Another quant fund that quantifiably improved its performance was RenTec, which made up almost the entire lot of its 8.7 percent decline from the beginning of August. An apparently clairvoyant James Simons had written to investors on August 10, “Usually such behavior—[market turmoil]—causes first pain and then opportunity… [with a return to normal conditions], we anticipate an attractive opportunity.” The turnaround made both investors who would choose to make money over losing it happy, and those of us keeping tabs on how many times the word “opportunity” is used in a letter by a hedge fund manager MTD, and having it actually mean something other than “bull shit.”
Goldman’s Global Alpha, down 27 percent for the year through August 13, is not doing as well. Clients’ requests for withdrawals totaling $1.6 billion have left the fund with a mere $6.8 billion in assets.
Goldman Global Equity Hedge Fund Rises 12% After Cash Infusion [Bloomberg]