Institutional Investor's Alpha Magazine - March 2008 - (Page 56) Top European Analysts By early March, Brandwood says, the Preferred List had returned 20 percent since inception. No firm has made more changes — personnel and other wise — than JPMorgan. Linares, the research head, says he has been “strengthening the This table shows rankings as determined by hedge fund managers compared with those as voted teams that were not strong enough,” pointing to by all portfolio managers. Many firms move up when only the votes of hedge funds are tallied. recent hires such as Utilities analyst Javier GarriDEVELOPED EUROPE do from Dresdner Kleinwort in October. He and Rank Total team positions Christopher Rogers co-lead the JPMorgan team, Hedge fund All-Europe Hedge fund All-Europe which is runner-up again. In November 2007, 2008 2008 Firm 2008 2008 Linares recruited Michael Gibbs from Goldman 1 Morgan Stanley 20 5 18 Sachs International to run the beverage-analysis 2 Merrill Lynch 19 3 25 team, and in February of this year, he hired Duncan Russell from Fox-Pitt, Kelton to head up the 2 UBS 19 1 33 insurance team. 4 Credit Suisse 14 4 24 JPMorgan also has a new lineup for its banking5 JPMorgan Securities 10 8 15 coverage team, which has ranked No. 2 for the 9 6 Citi Investment Research 2 30 past two years. Roger Doig has left, and Kian 6 Deutsche Bank 9 7 16 Abouhossein, who has been with the fi rm since 6 Lehman Brothers 9 2000, is now the senior analyst on European in6 17 vestment banks; Carla Antunes da Silva, who has 9 Goldman Sachs International 6 12 3 been on board since 2002, is now the lead analyst 10 Exane BNP Paribas 3 13 2 on U.K. banks. 11 Bear, Stearns International 2 13 2 The London office is offering more in the way Sanford C. Bernstein & Co. 2 11 10 4 of ser vices as well, Li nares says. By September 13 ABN Amro 1 13 2 2006, within a few months of his arrival, Linares had instituted a novel research series called “CEO 13 Crédit Agricole Cheuvreux 1 10 4 for a Day,” in which an analyst describes what 13 Euromobiliare 1 18 1 he or she would do to increase shareholder value HSBC Bank 1 13 13 2 in a company. “The job is to fi nd out what the Oddo Securities 13 1 18 1 road map is for stock performance,” he explains. EMERGING EMEA “And we do both — a road map on the upside and on the downside.” Rank Total team positions Hedge fund Emerging By September 2007, JPMorgan’s London Hedge fund Emerging 2008 EMEA 2008 Firm 2008 EMEA 2008 group had adopted an alpha-management tool 1 Renaissance Capital 9 2 10 — third-party software that allows its analysts to input “high-conviction trading ideas, both long 2 Deutsche Bank 5 1 11 and short,” and to track analysts’ performance, 3 UBS 3 3 9 making for “more discipline and more accounta4 Citi Investment Research 1 4 6 bility,” says Linares. 4 JPMorgan Securities 1 7 3 “Relative performance is almost dead,” he as1 4 UniCredit Markets & Investment Banking 6 5 serts. “In the past if you were down 3 percent but 4 UralSib Capital 1 10 1 the market was down 5 percent, that was okay. But today everyone is an absolute investor. From of the positions meant to be held for 30 to 60 days. But that perspective there’s been a monumental convergence Pink says he is looking at putting the concept out broadly between the hedge funds and the long funds.” in the U.K. this year. Linares says he believes an investment bank research Brandwood says the stocks on the Preferred List can department should be good enough to be “the idea genbe changed “at any point in time and with a very quick erator for both the cash sales force and the derivatives turnaround.” He also notes that since the stocks on the sales force.” list are equally weighted, the list is effectively a minialpha, That trend, he adds, should accelerate to the point or market-neutral, fund. where clients become completely indifferent as to whether He says, too, that by the end of 2007, his Preferred List, they are investing in one or the other. created in September, was up 11 percent. One hedge fund manager praises UBS for its “dedicated special-situations The ranking was compiled by Senior Associate Editor Tucker research, which is well done and differentiates them from Ewing under the guidance of Assistant Managing Editor many of their competitors.” Sathya Rajavelu and Senior Editor Jane B. Kenney. Hedge Fund Leaders Versus All-Europe and Emerging EMEA Research Teams 56 • INSTITUTIONAL INVESTOR’S ALPHA • MARCH 2008
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