Making Unique Observations in a Very Cluttered World

Wednesday, 21 January 2015

Hedge Fund Manager Loses 99.8% In 9 Months, Tells Investors He Is "Sorry" For "Overzealousness" -

Hedge Fund Manager Loses 99.8% In 9 Months, Tells Investors He Is "Sorry" For "Overzealousness" - 

Day after day, mainstream media proclaimed December the month to be in stocks: seasonals, Santa Claus rally, and performance-chasing funds would 'guarantee' upside. For Owen Li, former Raj Rajaratnam's Galleon Group trader, and the clients of his Canarsie Capital hedge fund, December 2014 will never be forgotten. According to CNBC, from around $100 million in AUM in March 2014, Li told investors in a letter, the fund had lost all but $200,000 and he was "truly sorry," for "acting overzealously" in the last 3 weeks.

Lawrence Delevingne reports:

A hedge fund manager told clients he is "truly sorry" for losing virtually all their money.

Owen Li, the founder of Canarsie Capital in New York, said Tuesday that he had lost all but $200,000 of the firm's capital—down from the roughly $100 million it ran as of late March 2014.

"I take responsibility for this terrible outcome," Li wrote in a letter to investors obtained by CNBC.com

"My only hope is that you understand that I acted in an attempt—however misguided—to generate higher returns for the fund and its investors. But even so, I acted overzealously, causing you devastating losses for which there is no excuse," he added.


Li said in the letter that he made a series of "aggressive transactions" over the last three weeks to make up for poor returns in December. He said he bet on stock price options, predicated on the broader market rising. But stock indexes instead fell, causing the huge losses along with several undisclosed direct investments, according to the note.
Li is a former trader at Raj Rajaratnam's Galleon Group, which collapsed amid insider trading charges.

Li's lieutenant at Canarsie is Ken deRegt, who joined in 2013 after having retiring as the global head of fixed income sales and trading at Morgan Stanley.

To Mr. Li's less than sophisticated investors we have a short clip summarizing what just happened:

As for Mr. Li, we look forward to his next "hedge" fund reincarnation so that we too can give him some of our money to manage because it really is not easy to find someone who can blow through $100 million in less than a year. And who knows: if someone is willing to fund a guy that dumb and that clueless, next time he actually is due to hit it out of the ballpark.


STUDY: Circumcision carried out before age of 5 'can increase risk of autism by 46%'... -

STUDY: Circumcision carried out before age of 5 'can increase risk of autism by 46%'... - 

Boys who are circumcised before the age of five are more likely to develop autism, a study has suggested. 

Autism is a disability that affects people's communication and behaviour and, according to the paper published in the Journal of the Royal Society of Medicine in January, circumcised boys are more likely "than intact boys" to develop ASD (Autism Spectrum Disorder). 

Researchers at Statens Serum Institut, Copenhagen, consulted the national registers to analyse information of 342,877 boys born in Denmark between 1994 and 2003.

"With a total of 4,986 ASD cases, our study showed that regardless of cultural background circumcised boys were more likely than intact boys to develop ASD before age 10 years," the paper said.

The study concluded that circumcision increased the risk of developing ASD by 46%.

Researchers explained that the link between circumcision and autism could be caused by the pain felt during the procedure.

According to some, painful experiences in babies "have been shown in animal and human studies to be associated with long-term alterations in pain perception, a characteristic often encountered among children with ASD." 

Others, however, have criticised the report linking circumcision to autism.

Speaking to the Huffington Post, Dr Douglas S Diekema, a pediatrician at the University of Washington in Seattle, warned that people should be careful when drawing conclusions after reading the report, which "raises questions for further study, but does not provide answers. Correlation does not imply or prove causation."

Diekema also explained that if there was a link between circumcision and autism, then the rate of the latter would have fallen in recent decades given that less boys are circumcised now - but in fact the opposite is true. 

Dr Howard Cohen, a Mohel (Jewish person trained to carry out circumcision) for the London and South East UK Jewish community, wrote in the Jewish News Online: "The wrong type of study was done to explore whether a causative link exists.

"Observational studies can suggest associations but cannot explain the mechanisms of diseases. The authors seemingly failed to grasp both what autism is or what happens at a circumcision."

The latest research has further ignited the long debate on circumcision. 

Supporters of this practice argue that circumcision helps reduce risks of infection, some cancers and also the transmission of STDs (sexually transmitted diseases).

Side-effects of circumcision can include pain, bruising and swelling of the skin around the penis, formation of abnormal scar tissue and damage to the urethra. Opponents argue that this practice can also cause negative effects on sexual health and emotional, sexual and social negative side effects that are visible only after childhood. 

Last April, a joint US and Australia study claimed that the benefits of circumcision exceed the risks "a hundreds times over" and that the practice has no adverse effect on sexual function, sensitivity or pleasure. 

In May 2014, however, a study from the American Academy of Pediatrics said that risk of circumcision side effects are 20 times greater if boys are subjected to this practice after the first year of birth. 

Circumcision is very controversial in some countries, which have banned it. A report published by the European Council in 2013 called the practice a human rights violation.

In 2012, Germany criminalised circumcision if it is carried out for religious purposes.

Medical associations in Sweden and Denmark urged for non-medical circumcision of boys to be banned and last October a survey revealed that almost three quarters of Danes want the practice to be abolished. 

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