Bonus Season Brings More Pain for Traders (WSJ)
Investment bankers, including those who advise companies on mergers and underwrite stock offerings, and private-equity employees should see bonuses rise as much as 15% from a year ago, according to an analysis by Johnson Associates, a New York compensation-consulting firm. Bonuses paid to fixed-income and stock traders may decline by as much as 10%, Johnson Associates said. Hedge-fund payouts should range from an increase of 5% to a decrease of 10%, the firm said. The study echoes many of the same themes sounded by each of the biggest banks during their quarterly results. A stock-market rally and mounting confidence in the economy’s direction have emboldened corporate chiefs to pursue acquisitions.
Janus Attracted More Than $1 Billion After Gross Joined (Bloomberg)
The Janus Global Unconstrained Bond Fund (JUCIX), which Gross started managing last month, drew an estimated $364 million in client deposits in its first full month with the bond legend at the helm, bringing assets to $442.9 million through Oct. 31, according to data compiled by Bloomberg. Janus Flexible Bond Fund (JAFIX), a core bond strategy, saw $821 million of deposits in the month, pushing assets to $8.4 billion.
Pimco to Spend $280 Million on Staff Retention (MoneyBeat)
In a bid to stave off further departures during a year of management changes and heavy outflows, the bond giant unveiled a new “enhanced compensation program”. The initiative, implemented in the wake of co-founder Bill Gross’s abrupt departure in September, will cost about €225 million ($279.45) through mid-2017, parent insurer Allianz SE said Friday. Under the new plan, Pimco will make so-called “special performance awards” in addition to normal 2014 year-end compensation. The bonuses will be awarded to staff members that are senior, but below managing director level, and will be paid out over 12 to 30 months.
Paulson Event-Driven Fund Said to Plunge 14% in October (Bloomberg)
Billionaire John Paulson posted a 14 percent loss in his firm’s event-driven hedge fund during October, adding to declines this year, two people with knowledge of the matter said. The monthly drop left the Paulson Advantage fund down about 25 percent in 2014, said the people, who asked not to be identified because the information is private. Paulson Credit Opportunities lost 6.8 percent in October, leaving it down 3.4 percent in 2014.
Bond Swings Draw Scrutiny (WSJ)
The day’s trading was just hitting its stride in New York on the morning of Oct. 15 when bond investors, traders and strategists were stunned by an unusual move in the $12 trillion U.S. Treasury market playing out on their computer screens. The yield on the 10-year Treasury note took a sharp dive below 2% within minutes, and few could understand exactly why. Some dealers immediately pulled the plug on automated trading systems that provided price quotes to customers. Fund managers rushed to convene meetings. Many investors scrambled to pinpoint the reason behind the accelerating decline. “It starts moving faster and faster, and you can’t point to anything,” recalled Mark Cernicky, managing director at Principal Global Investors , which oversees $78 billion. Now, investors and regulators are burrowing into the causes of the plunge in yields to try to understand whether electronic trading and new regulations are fueling sudden price swings in a market that acts as a key benchmark for interest rates, investments and U.S. home loans.
Meth suspect wore 'I [heart] Crystal Meth' T-shirt (UPI)
The Laurel County Sheriff's Office said Deborah Asher, 37, was wearing the T-shirt when she was arrested alongside Richard Rice, 57, as part of a drug investigation Tuesday. Police said the suspects were in possession of 3.37 grams of crystal meth as well as a set of digital scales.
CFTC Turns Toward Administrative Judges (WSJ)
The Commodity Futures Trading Commission plans to start steering some of its cases against trading firms, brokers and others to administrative law judges appointed by federal agencies, instead of trials in federal court, according to a top official. The move comes as defense lawyers criticize the escalating use of administrative law judges by regulators pursuing financial wrongdoing, saying it eliminates an independent jury from the process. Securities and Exchange Commission officials have said previously they intend to more often use administrative proceedings for insider-trading and other complicated cases.
The money man who helped the GOP win (NetNet)
Better known as "Bob," Mercer is co-head of Renaissance Technologies, a secretive hedge fund firm that manages $25 billion using fast-trading computer programs from its headquarters in a quiet hamlet on Long Island. Thanks both to looser campaign finance rules and his promotion to help lead one of the largest hedge funds in the world, Mercer has quietly become a major player in politics since 2010. He donated more than $8 million this election cycle alone, putting him behind only Singer as the second-largest Republican booster. And Mercer was fourth overall regardless of party after hedge fund manager-turned environmentalist Tom Steyer and former New York City mayor Michael Bloomberg, according to data compiled by the Center for Responsive Politics.
Pregnant, unmarried, and fired, woman sues firm (NYP)
Ben Lorello, one of Wall Street’s most powerful investment bankers, humiliated and isolated a top female banker — a colleague at Jefferies & Co. — last year after she told the firm she was trying to get pregnant, according to charges in a wrongful-termination lawsuit filed by the woman. Amy Corinne Smith, an investment banker and co-head of Jefferies’ cleantech sector at the time — and the only female group boss at the firm — was subject to a hostile work environment created in part by Lorello and was eventually let go by the firm, it is alleged. During a business dinner in March 2013, after the unmarried Smith alerted Lorello and others at Jefferies that she was undergoing fertility treatments, he prodded her with personal questions in front of male colleagues during a work dinner, according to the complaint, filed in May 2013 but received little media attention.
BNP Paribas bankers frustrated by rejected expenses (NYP)
Top bankers at BNP Paribas are frustrated by compliance execs who are getting down to the nitty- gritty, analyzing every expense — even rejecting bankers’ lunches if they don’t recognize the venue. The French bank feels pressure after pleading guilty to money laundering for regimes in Iran and Cuba, paying nearly $9 billion in fines.
Ventriloquist Fights Gag Order Against His Puppet (AP)
A South African ventriloquist said Monday that he will challenge a gag order against his puppet. The ventriloquist, Conrad Koch, said he strongly denies allegations that tweets criticizing the singer Steve Hofmeyr amounted to hate speech. The singer said the tweets, which came from the Twitter account of the puppet, accused him of racism. He said he had obtained a court order barring the ventriloquist and his puppet, Chester Missing, from making any statements about him in public or on social media.