Hedge Fund Report: Activists Don't Always Shout

Franklin Templeton(FTF Quote), for instance, has such a product with (TLSAX Quote)Templeton Global Long-Short, and Janus is readying its Advisor Long/Short fund. The latest in the series is the (BETAX Quote)Beta Hedged Strategy fund launched last week by AIP Alternative Strategies, a White Plains, N.Y.-based money manager specializing in alternative mutual funds. It's a more aggressive version of AIP's first hedgelike mutual fund, the (ALPHX Quote)Alpha Hedged Strategies fund launched in 2002.

Casualty Report

The convertible arbitrage market is recovering, but there are still some casualties.

The latest is Saranac Capital Management, a hedge fund run by Ross Margolies, a former Citigroup(C Quote) trader. The fund is closing down due to a loss of 80% of its assets, according to a Bloomberg report published on Friday. Saranac opened at the end of 2004 with $2.9 billion and is left today with only $600 million, according to the report.

The loss of assets, which generate fees for the fund, is what prompted Margolies to close down his shop. Two-third of the firm's assets were in arbitrage strategies, with 60% of that amount invested in convertible arbitrage. The convertible arbitrage funds lost 2% last year, sending investors to the exit door. Margolies expects to return money to his investors by June 30.