Misplaced Pages

#322677

106-699: Kitimat is a district municipality in the North Coast region of British Columbia , Canada. It is a member municipality of the Regional District of Kitimat–Stikine regional government. The Kitimat Valley is part of the most populous urban district in northwest British Columbia, which includes Terrace to the north along the Skeena River Valley. The city was planned and built by the Aluminum Company of Canada ( Alcan ) during

212-414: A bull market , distressed investing works best during a bear market . Risk arbitrage or merger arbitrage includes such events as mergers , acquisitions, liquidations, and hostile takeovers . Risk arbitrage typically involves buying and selling the stocks of two or more merging companies to take advantage of market discrepancies between acquisition price and stock price. The risk element arises from

318-439: A counterparty to derivative contracts , and lends securities for particular investment strategies, such as long/short equities and convertible bond arbitrage . It can provide custodial services for the fund's assets, and trade execution and clearing services for the hedge fund manager. Hedge fund administrators are typically responsible for valuation services, and often operations , and accounting . Calculation of

424-1006: A lack of transparency . Another common perception of hedge funds is that their managers are not subject to as much regulatory oversight and/or registration requirements as other financial investment managers, and more prone to manager-specific idiosyncratic risks such as style drifts, faulty operations, or fraud. New regulations introduced in the US and the EU as of 2010 required hedge fund managers to report more information, leading to greater transparency. In addition, investors, particularly institutional investors, are encouraging further developments in hedge fund risk management, both through internal practices and external regulatory requirements. The increasing influence of institutional investors has led to greater transparency: hedge funds increasingly provide information to investors including valuation methodology, positions, and leverage exposure. Hedge funds share many of

530-535: A "fundamental growth" strategy invest in companies with more earnings growth than the overall stock market or relevant sector, while funds using a " fundamental value " strategy invest in undervalued companies. Funds that use quantitative and financial signal processing techniques for equity trading are described as using a "quantitative directional" strategy. Funds using a " short bias " strategy take advantage of declining equity prices using short positions. Event-driven strategies concern situations in which

636-440: A CTA from a regulatory perspective and the main divide is between systematic and discretionary strategies. A classification framework for CTA/Macro Strategies can be found in the reference. Directional investment strategies use market movements, trends, or inconsistencies when picking stocks across a variety of markets. Computer models can be used, or fund managers will identify and select investments. These types of strategies have

742-623: A century to describe a region of the province that extends west from the Coast Mountains and North Cascades . This definition makes the term British Columbia Coast largely synonymous with the 15 regional districts that have territory in this region. Among locals, the British Columbia Coast can further be divided into seven major subregions: Research from the 1990s has indicated that the Ice Age-era coastline of

848-431: A computerized system, known as "systematic/quantitative". The amount of diversification within the fund can vary; funds may be multi-strategy, multi-fund, multi-market, multi-manager, or a combination. Sometimes hedge fund strategies are described as " absolute return " and are classified as either " market neutral " or "directional". Market neutral funds have less correlation to overall market performance by "neutralizing"

954-413: A detailed investigation of the area. Alcan was searching for a site for a large aluminum smelter , an activity requiring vast amounts of electricity. Alcan concluded that the area was more than adequate to generate the required electricity, and decided to build a smelter there. The timing was right because the post- World War II boom saw a rising demand for aluminum. Between 1951 and 1954, after signing

1060-521: A fund has too much exposure to a particular investment, sector, trading strategy, or group of correlated funds. These risks may be managed through defined controls over conflict of interest , restrictions on allocation of funds, and set exposure limits for strategies. Many investment funds use leverage , the practice of borrowing money, trading on margin , or using derivatives to obtain market exposure in excess of that provided by investors' capital. Although leverage can increase potential returns,

1166-446: A fund manager "drifting" away from an area of specific expertise, manager risk factors include valuation risk , capacity risk, concentration risk , and leverage risk . Valuation risk refers to the concern that the net asset value (NAV) of investments may be inaccurate; capacity risk can arise from placing too much money into one particular strategy, which may lead to fund performance deterioration; and concentration risk may arise if

SECTION 10

#1732776775323

1272-470: A good year. Earnings at the very top are higher than in any other sector of the financial industry, and collectively the top 25 hedge fund managers regularly earn more than all 500 of the chief executives in the S&;P 500 . Most hedge fund managers are remunerated much less, however, and if performance fees are not earned then small managers at least are unlikely to be paid significant amounts. In 2011,

1378-403: A greater appetite for risk , with the intention of maximizing returns, subject to the risk tolerance of investors and the fund manager. Managers will have an additional incentive to increase risk oversight when their own capital is invested in the fund. Hedge fund management firms typically charge their funds both a management fee and a performance fee . Management fees are calculated as

1484-604: A greater exposure to the fluctuations of the overall market than do market neutral strategies. Directional hedge fund strategies include US and international long/short equity hedge funds, where long equity positions are hedged with short sales of equities or equity index options . Within directional strategies, there are a number of sub-strategies. " Emerging markets " funds focus on emerging markets such as China and India, whereas "sector funds" specialize in specific areas including technology, healthcare, biotechnology, pharmaceuticals, energy, and basic materials. Funds using

1590-466: A joint venture between Shell and affiliates of Petronas , Mitsubishi Corporation , Korea Gas Corporation and PetroChina would, if permitted, begin construction in 2015 of a gas pipeline from northeastern BC and a LNG export terminal with an expected lifespan of 30 years. The terminal, located on the Douglas Channel near the aluminum refinery, would be able to accommodate two LNG vessels at

1696-439: A large amount of flexibility (due to their ability to use leverage to take large positions in diverse investments in multiple markets), the timing of the implementation of the strategies is important in order to generate attractive, risk-adjusted returns. Global macro is often categorized as a directional investment strategy. Global macro strategies can be divided into discretionary and systematic approaches. Discretionary trading

1802-445: A management fee of 2% on total assets and a 20% fee on realized gains. In the 1970s, hedge funds specialized in a single strategy with most fund managers following the long/short equity model. Many hedge funds closed during the recession of 1969–1970 and the 1973–1974 stock market crash due to heavy losses. They received renewed attention in the late 1980s. During the 1990s, the number of hedge funds increased significantly with

1908-400: A manager is only rewarded if the fund generates returns in excess of the returns that the investor would have received if they had invested their money elsewhere. Some hedge funds charge a redemption fee (or withdrawal fee) for early withdrawals during a specified period of time (typically a year), or when withdrawals exceed a predetermined percentage of the original investment. The purpose of

2014-422: A manager will sometimes close a fund that has suffered serious losses and start a new fund, rather than attempt to recover the losses over a number of years without a performance fee. Some performance fees include a " hurdle ", so that a fee is only paid on the fund's performance in excess of a benchmark rate ( e.g. , LIBOR ) or a fixed percentage. The hurdle is usually tied to a benchmark rate such as Libor or

2120-400: A percentage of the fund's net asset value and typically range from 1% to 4% per annum, with 2% being standard. They are usually expressed as an annual percentage, but calculated and paid monthly or quarterly. Management fees for hedge funds are designed to cover the operating costs of the manager, whereas the performance fee provides the manager's profits. However, due to economies of scale

2226-533: A population density of 34.4/km (89.1/sq mi) in 2021. According to the 2021 census , religious groups in Kitimat included: The Alcan project was not free from controversy. Politicians, aboriginal groups, farmers and residents of the Nechako Lakes District opposed the contractual release of provincial resources with the profits going to a private firm. Many individuals and groups protested

SECTION 20

#1732776775323

2332-665: A position based on the predicted movement of the security or securities in question. Large institutional investors such as hedge funds are more likely to pursue event-driven investing strategies than traditional equity investors because they have the expertise and resources to analyze corporate transactional events for investment opportunities. Corporate transactional events generally fit into three categories: distressed securities , risk arbitrage , and special situations . Distressed securities include such events as restructurings, recapitalizations , and bankruptcies . A distressed securities investment strategy involves investing in

2438-501: A predominantly oceanic climate in the north along the coast and further inland into the foothills of the Pacific Ranges . Higher elevations feature a subpolar oceanic climate ( Köppen : Cfc) with cool summers, cold winters, and constant rainfall that peaks during the winter months. The highest elevations feature a subarctic climate ( Köppen : Dfc). The British Columbia Coast is dominated by temperate rainforest . According to

2544-415: A second tunnel through the mountain and extended the generating station within the mountain, the provincial government of the day called a halt to the project for a variety of reasons. Having invested over $ 500 million into the project, Alcan took the provincial government to court. This controversy was settled when Alcan and the provincial government signed the 1997 KCP agreement. Most of the first decade of

2650-410: A single strategy or multiple strategies for flexibility, risk management , or diversification. The hedge fund's prospectus , also known as an offering memorandum , offers potential investors information about key aspects of the fund, including the fund's investment strategy, investment type, and leverage limit. The elements contributing to a hedge fund strategy include the hedge fund's approach to

2756-627: A state of maturity that is consolidating around the larger, more established firms such as Citadel, Elliot, Millennium, Bridgewater, and others. The rate of new fund start ups is now outpaced by fund closings. In July 2017, hedge funds recorded their eighth consecutive monthly gain in returns with assets under management rising to a record $ 3.1 trillion. Hedge fund strategies are generally classified among four major categories: global macro , directional, event-driven , and relative value ( arbitrage ). Strategies within these categories each entail characteristic risk and return profiles. A fund may employ

2862-401: A strategy based on predicting the final approval of new pharmaceutical drugs ; and legal catalyst strategy, which specializes in companies involved in major lawsuits. Relative value arbitrage strategies take advantage of relative discrepancies in price between securities. The price discrepancy can occur due to mispricing of securities compared to related securities, the underlying security or

2968-496: A substantial portion of the asset management industry, with assets totaling around $ 3.8 trillion as of 2021. The word "hedge", meaning a line of bushes around the perimeter of a field, has long been used as a metaphor for placing limits on risk. Early hedge funds sought to hedge specific investments against general market fluctuations by shorting other, similar assets. Nowadays, however, many different investment strategies are used, many of which do not "hedge" risk. During

3074-681: A time. Annual volume would be 24 million tonnes. In July 2014 the Financial Post reported that Apache Corp. will "completely exit" the Kitimat LNG mega-project planned for B.C.'s West Coast. The U.S. hedge fund Jana Partners LLC has pressured Houston-based Apache to sell its 50% stake in the BC shale gas plays. Pending energy projects that have identified Kitimat as a strategic gateway include Pacific Northern Gas' Pacific Trail Pipeline (federal and provincial environmental assessments issued) and

3180-517: A total cargo volume of 76.5 million metric tons. By the same metric, the Port of Vancouver is also the fifth largest commercial shipping port in North America. The Port of Prince Rupert possesses the deepest ice-free natural harbour in North America, and the 3rd deepest natural harbour in the world. Situated at 54° North, the harbour is the northwesternmost port in North America linked to

3286-446: Is 629 km (391 mi) to the east. Kitimat has a warm-summer humid continental ( Köppen climate classification Dfb ) with mild summers and cold, snowy winters (much warmer than inland) with significant snowfall averaging 128 inches (325 cm) each year. The rainiest season is fall, with the wettest month, October, having 320 mm of rainfall. There is also a significant drying trend (Mediterranean pattern) in summer, but it

Kitimat - Misplaced Pages Continue

3392-453: Is also renewed interest in mineral development potential in the Kitimat area. The neighbouring community of Terrace is also in advanced stages of approval for a number of clean energy projects along with the associated infrastructure for linking those projects to the provincial electrical grid. Air services for the community are provided through Northwest Regional Airport , with connections to Prince George , Smithers , and Vancouver . In

3498-602: Is carried out by investment managers who identify and select investments, whereas systematic trading is based on mathematical models and executed by software with limited human involvement beyond the programming and updating of the software. These strategies can also be divided into trend or counter-trend approaches depending on whether the fund attempts to profit from following market trend (long or short-term) or attempts to anticipate and profit from reversals in trends. Within global macro strategies, there are further sub-strategies including "systematic diversified", in which

3604-666: Is common for hedge fund investment strategies to aim to achieve a positive return on investment regardless of whether markets are rising or falling (" absolute return "). Hedge funds can be considered risky investments; the expected returns of some hedge fund strategies are less volatile than those of retail funds with high exposure to stock markets because of the use of hedging techniques. Research in 2015 showed that hedge fund activism can have significant real effects on target firms, including improvements in productivity and efficient reallocation of corporate assets. Moreover, these interventions often lead to increased labor productivity, although

3710-492: Is connected to the rest of B.C by various roads depending on the region. The populous Fraser Valley and Lower Mainland is linked to the rest of the province by Highway 1 (Fraser Canyon Highway), Highway 5 (Coquihalla Freeway), Highway 3 (Crowsnest Highway) and Highway 99 (Sea to Sky Highway). The Lower Mainland is also connected to the U.S. by four highway border crossings with the Peace Arch on Interstate 5 being

3816-510: Is dominated by a moderate oceanic climate ( Köppen : Cfb) with warm summers, cool winters, and constant rainfall that peaks during the winter months. These areas enjoy the mildest winter weather in all of Canada, as temperatures rarely fall below freezing. The southernmost region of the coast (surrounding the Salish Sea ) features a warm-summer Mediterranean climate with warm, dry summers and cool, wet winters. This gradually transitions to

3922-537: Is estimated to be in 2025. The LNG Canada terminal project will see large LNG carrier ships loading liquefied natural gas at the future Kitimat LNG terminal, and sailing along the Douglas Channel to carry it to export destinations, mainly in Asia. Kitimat is located 63 km (39 mi) south of Terrace and Thornhill on Highway 37. Prince Rupert is 207 km (129 mi) northwest, and Prince George

4028-400: Is no north–south highway linking the coastal communities of the province between Port Hardy and Kitimat . Instead, travellers utilize one of the coastal ferry lines operated by BC Ferries . The exceptions are Bella Coola is accessible by a long largely gravel Highway 20 from the B.C interior over a high pass; and the towns of Terrace , Prince Rupert and Kitimat which is assessed from

4134-557: Is reduced but cannot be eliminated. According to a report by the Hennessee Group, hedge funds were approximately one-third less volatile than the S&P 500 between 1993 and 2010. Investors in hedge funds are, in most countries, required to be qualified investors who are assumed to be aware of the investment risks , and accept these risks because of the potential returns relative to those risks. Fund managers may employ extensive risk management strategies in order to protect

4240-420: Is the main employer in the municipality. Local government, schools, small manufacturing and service/retail are secondary contributors. Secondary core activities include engineering, import of petrochemical products (methanol and condensate), and metal fabrication. Approximately $ 5 billion in manufacturing investment is anticipated in the 2010–2015 period with a further $ 5 billion-plus in the investigative stage over

4346-430: Is too cold and rainy to classify as such. Cloud cover is significant, especially in winter, and less than 30% of possible sunshine occurs each year. In the 2021 Census of Population conducted by Statistics Canada , Kitimat had a population of 8,236 living in 3,604 of its 4,381 total private dwellings, a change of 1.3% from its 2016 population of 8,131. With a land area of 239.28 km (92.39 sq mi), it had

Kitimat - Misplaced Pages Continue

4452-476: Is transported 80 km (50 mi) across mountains via a custom built twin circuit transmission line. After avalanches tore away transmission towers, a catenary system was built. In three years, 6,000 construction workers built the dam, tunnel, powerhouse, transmission line, smelter, and town. The town of Kitimat was carved out of old-growth forest . The company invested over CA$ 500 million (equivalent to CA$ 3.3 billion) and employed over 35,000 workers over

4558-479: The 1990s stock market rise , the aligned-interest compensation structure ( i.e. , common financial interests), and the promise of above average returns as likely causes. Over the next decade, hedge fund strategies expanded to include credit arbitrage, distressed debt , fixed income , quantitative , and multi-strategy. US institutional investors , such as pension and endowment funds , began allocating greater portions of their portfolios to hedge funds. During

4664-615: The Enbridge Northern Gateway Pipelines (currently being reviewed by the National Energy Board ). Additional investigations into clean energy developments include a Kitimat port development project featuring break-bulk port facilities and consideration of the best uses for the former Eurocan Wharf. In addition, the decommissioning of the former Eurocan pulp and paper facilities or a slimmed down operation are still under consideration. There

4770-521: The ecoregion system used by the World Wide Fund for Nature (WWF), the BC Coast is part of five distinct ecoregions: Puget lowland forests , Central Pacific coastal forests , British Columbia mainland coastal forests , Haida Gwaii coastal forests , and Pacific Coastal Mountain icefields and tundra . According to the ecozone system used by Environment and Climate Change Canada (ECCC),

4876-408: The net asset value ("NAV") by the administrator, including the pricing of securities at current market value and calculation of the fund's income and expense accruals, is a core administrator task, because it is the price at which investors buy and sell shares in the fund. The accurate and timely calculation of NAV by the administrator is vital. The case of Anwar v. Fairfield Greenwich (SDNY 2015)

4982-726: The 1,226 people on the Forbes World's Billionaires List for 2012, 36 of the financiers listed "derived significant chunks" of their wealth from hedge fund management. Among the richest 1,000 people in the United Kingdom, 54 were hedge fund managers, according to the Sunday Times Rich List for 2012. A portfolio manager risks losing his past compensation if he or she engages in insider trading . In Morgan Stanley v. Skowron , 989 F. Supp. 2d 356 (S.D.N.Y. 2013), applying New York's faithless servant doctrine,

5088-568: The 100 m (330 ft) contour, and the Ice Age existence of such a coastal plain has put a new light on Ice Age populations in North America as well as on the strong likelihood of this area having been the major migration route from (and perhaps to) Asia . The heavy indentation and mild climate of the British Columbia Coast have led to inevitable comparisons with the geography's predisposition to encouraging increased human settlement and movement as well as cultural foment and population growth in

5194-723: The 15 regional districts of British Columbia defined as being in the Coast region: The fishery of the Pacific Northwest Coast is legendary, especially for its many salmon runs and the cultures that built on top of them throughout the region. Salmon runs have greatly diminished since pre-Contact years and the advent of commercial canning and, ultimately, depletion of stocks by high-seas fishing. Other commercial fisheries include halibut , herring and herring roe, sea urchin and other specialty sushis , hake , haddock , cod , crab and shellfish. The Coast Region of B.C

5300-608: The 1920s, the provincial government of British Columbia extensively evaluated the province's hydroelectric generating potential. In the late 1940s, the Canadian Government sought to tap the untapped resources of northwest British Columbia. All this led to the identification of the Eutsuk / Ootsa / Nechako River drainage basin as a potential site for a sizable reservoir. The potential of this vast system of rivers and lakes prompted British Columbia to invite Alcan to conduct

5406-484: The 1950s. Its post office was approved on 6 June 1952. Kitimat's municipal area is 242.63 km (93.68 sq mi). It is located on tidewater in one of the few wide, flat valleys on the coast of British Columbia. The 2016 census recorded 8,131 citizens. The District of Kitimat Development Services situates the port of Kitimat as an integral part of the Northwest Corridor connecting North America to

SECTION 50

#1732776775323

5512-635: The Aegean, the Irish Sea/Hebrides and in the Danish Archipelago and adjoining Scandinavian coasts. The natural fecundity of the environment – rich in seafood , wild game , and greenery – combined with the ease of travel (by water) is seen in all cases (British Columbia, Denmark , Greece ) to have generated a dynamic and gifted civilization. And there are comparisons to be made between the artistic and political and social level of

5618-674: The B.C. interior on Highway 16 . Haida Gwaii has an extension of Highway 16 on it, one of Haida Gwaii's few paved roads. The sheltered waterways of the British Columbia Coast form part of the Inside Passage , a coastal maritime route along which vessels navigate to avoid the rough waters and bad weather of the open North Pacific . As such, the maritime route is heavily trafficked by cruise ships , cargo ships , ferries , and other marine vessels. BC Ferries , an independently managed publicly-owned company , operates scheduled daily crossings between major population centres throughout

5724-584: The BC Coast is part of four distinct ecozones: Pacific Coastal Mountains , Coastal Western Hemlock-Sitka Spruce Forests , Pacific and Nass Ranges , and Strait of Georgia/Puget Lowland . According to the British Columbia Ministry of Forests , which uses an ecosystem classification system independent of the WWF and ECCC , the BC Coast is part of two distinct biogeoclimatic zones: Coastal Western Hemlock and Coastal Douglas-fir . Below are

5830-435: The British Columbia Coast was lower by about 100 m (330 ft). The effect of the sea level on the coastline was such that Queen Charlotte Sound , which is between Haida Gwaii and the northern end of Vancouver Island, was a coastal plain, as were all the straits inland from it, except for those that were mountain valleys. Underwater archaeology has shown the presence of permanent human habitations and other activity at

5936-428: The British Columbia Coast. Dozens of smaller ferries ply lesser routes within and between these regions. The Alaska Marine Highway also operates nonstop ferry service through the British Columbia Coast along its Bellingham-Ketchikan route. The Port of Vancouver is the largest commercial shipping port in all of Canada and along the entire Pacific Ocean / Pacific coast of North America by metric tons , which handles

6042-489: The District appear to have become more cordial, with the two parties working to achieve modernization of the aluminum facilities. In December 2011, Rio Tinto Alcan announced its investment of $ 2.7 billion to complete the modernization of the smelter. British Columbia Coast While the exact boundaries are variously defined, the region is generally defined to include the 15 regional districts that have coastline along

6148-545: The Island. Although the Sunshine Coast is on the mainland it is connected to the highway network only by ferries. It has one route which is Highway 101 , a narrow curvy 2 lane road split in two by a ferry crossing. Texada Island , a large island off the Sunshine Coast and has its own network of highway standard roads although they are unnumbered. Owing to the challenging topography of the British Columbia Coast, there

6254-602: The Pacific Northwest Peoples and those of pre-Conversion pagan Scandinavia, Ireland and Archaic-Era Greece. The British Columbia Coast stretches from the southern tip of Vancouver Island along the Strait of Juan de Fuca to the community of Stewart at the head of Portland Canal . The aerial distance between these two points is approximately 954 km (593 mi). However, due to its deeply incised coastline and over 40,000 islands of varying sizes,

6360-897: The Pacific Ocean and the Pacific Rim. "Kitimat" in the Tsimshian language refers to the Haisla First Nation as the "People of the Snow". Before 1950 the Kitimat township was a small fishing village at the head of the Kitimat Arm of the Douglas Channel , a deepwater fjord . The municipal town of Kitimat came into existence in 1951 after the Provincial Government of British Columbia invited Alcan to develop hydroelectric facilities to support one of

6466-614: The Pacific Ocean or Salish Sea , or are part of the Lower Mainland , a subregion of the British Columbia Coast. Other boundaries may exclude parts of or even entire regional districts, such as those of the aforementioned Lower Mainland . While the term British Columbia Coast has been recorded from the earliest period of non-native settlement in British Columbia, it has never been officially defined in legal terms. The term has historically been in popular usage for over

SECTION 60

#1732776775323

6572-654: The US bull market of the 1920s, there were numerous private investment vehicles available to wealthy investors. Of that period, the best known today is the Graham-Newman Partnership, founded by Benjamin Graham and his long-time business partner Jerry Newman. This was cited by Warren Buffett in a 2006 letter to the Museum of American Finance as an early hedge fund, and based on other comments from Buffett, Janet Tavakoli deems Graham's investment firm

6678-620: The US, either existing or planned on the West ( Alaska , Washington , Oregon ), Gulf ( Louisiana , Texas ) and Atlantic coasts ( Maryland , Virginia ). This new terminal being built in the port of Kitimat will be connected to the Pacific Ocean via the existing Douglas Channel . This development will add new sensitive ship traffic when the LNG Canada natural gas storage and liquefaction terminal will be completed and operational, which

6784-499: The United States and Europe following the financial crisis of 2007–2008 with the intention of increasing government oversight of hedge funds and eliminating certain regulatory gaps. While most modern hedge funds are able to employ a wide variety of financial instruments and risk management techniques, they can be very different from each other with respect to their strategies, risks, volatility and expected return profile. It

6890-547: The United States collectively held $ 1.335 trillion. In April 2012, the hedge fund industry reached a record high of US$ 2.13 trillion total assets under management. In the middle of the 2010s, the hedge fund industry experienced a general decline in the "old guard" fund managers. Dan Loeb called it a "hedge fund killing field" due to the classic long/short falling out of favor because of unprecedented easing by central banks . The US stock market correlation became untenable to short sellers . The hedge fund industry today has reached

6996-728: The agreement with the British Columbia government for land and water rights, Alcan undertook the Kitimat– Kemano Project , one of the most ambitious Canadian engineering projects of the 20th century. The project required not only building the Kenney Dam to reverse the Nechako River, but also boring a 16 km (10 mi) tunnel under Mt. Dubose, within the Coast Range , to the large hydroelectric Kemano Generating Station built under Mt. Dubose. Electricity from Kemano

7102-426: The benefits may not fully accrue to workers in terms of increased wages or work hours. A hedge fund usually pays its investment manager a management fee (typically, 2% per annum of the net asset value of the fund) and a performance fee (typically, 20% of the increase in the fund's net asset value during a year). Hedge funds have existed for many decades and have become increasingly popular. They have now grown to be

7208-479: The bonds or loans of companies facing bankruptcy or severe financial distress, when these bonds or loans are being traded at a discount to their value. Hedge fund managers pursuing the distressed debt investment strategy aim to capitalize on depressed bond prices. Hedge funds purchasing distressed debt may prevent those companies from going bankrupt, as such an acquisition deters foreclosure by banks. While event-driven investing, in general, tends to thrive during

7314-528: The coast. The proximity of these mountains to the coast produce fjords that rival those of Norway in length and depth. Several large Islands fill the strait between Vancouver Island and the Mainland with Texada Island , Cortes Island and Salt Spring Island being the largest in size. Fjords of note include Burrard Inlet , Burke Channel , Howe Sound , Jervis Inlet , Desolation Sound , Dean Channel , Douglas Channel , and Portland Inlet . The BC Coast

7420-461: The community. The substantial greenspace areas and future expansion concepts designed by Stein have been upheld to this day by the city planners, thereby resulting in a low-density settlement pattern interspersed with forested patches. Also, the Alcan-based city origin and land provenance remain documented in the form of restrictive covenants registered on title. Aluminum producer Rio Tinto

7526-555: The construction of a new liquified natural gas port terminal project named LNG Canada , coupled with the construction by a subsidiary of TransCanada of a gas pipeline, known as the Coastal GasLink Pipeline , linking this terminal to the Montney , British Columbia, natural gas field. When completed, LNG Canada will become the first Canadian LNG export ocean terminal, which will compete with other LNG terminals in

7632-558: The continent's railway network. The port is the first inbound and last outbound port of call for some cargo ships travelling between eastern Asia and western North America since it is the closest North American port to key Asian destinations. Hedge fund A hedge fund is a pooled investment fund that holds liquid assets and that makes use of complex trading and risk management techniques to improve investment performance and insulate returns from market risk . Among these portfolio techniques are short selling and

7738-541: The court held that a hedge fund's portfolio manager engaging in insider trading in violation of his company's code of conduct, which also required him to report his misconduct, must repay his employer the full $ 31 million his employer paid him as compensation during his period of faithlessness. The court called the insider trading the "ultimate abuse of a portfolio manager's position". The judge also wrote: "In addition to exposing Morgan Stanley to government investigations and direct financial losses, Skowron's behavior damaged

7844-609: The effect of market swings whereas directional funds utilize trends and inconsistencies in the market and have greater exposure to the market's fluctuations. Hedge funds using a global macro investing strategy take large positions in share, bond, or currency markets in anticipation of global macroeconomic events in order to generate a risk-adjusted return . Global macro fund managers use macroeconomic ("big picture") analysis based on global market events and trends to identify opportunities for investment that would profit from anticipated price movements. While global macro strategies have

7950-431: The fee is to discourage short-term investing, reduce turnover, and deter withdrawals after periods of poor performance. Unlike management fees and performance fees, redemption fees are usually kept by the fund and redistributed to all investors. Hedge fund management firms are often owned by their portfolio managers , who are therefore entitled to any profits that the business makes. As management fees are intended to cover

8056-540: The firm's operating costs, performance fees (and any excess management fees) are generally distributed to the firm's owners as profits. Funds do not tend to report compensation, and so published lists of the amounts earned by top managers tend to be estimates based on factors such as the fees charged by their funds and the capital they are thought to have invested in them. Many managers have accumulated large stakes in their own funds and so top hedge fund managers can earn extraordinary amounts of money, perhaps up to $ 4 billion in

8162-736: The firm's reputation, a valuable corporate asset." A hedge fund is an investment vehicle that is most often structured as an offshore corporation , limited partnership , or limited liability company . The fund is managed by an investment manager in the form of an organization or company that is legally and financially distinct from the hedge fund and its portfolio of assets . Many investment managers utilize service providers for operational support. Service providers include prime brokers, banks, administrators, distributors, and accounting firms. Prime brokers clear trades and provide leverage and short-term financing . They are usually divisions of large investment banks. The prime broker acts as

8268-604: The first decade of the 21st century, hedge funds gained popularity worldwide, and, by 2008, the worldwide hedge fund industry held an estimated US$ 1.93 trillion in assets under management (AUM). However, the financial crisis of 2007–2008 caused many hedge funds to restrict investor withdrawals and their popularity and AUM totals declined. AUM totals rebounded and in April 2011 were estimated at almost $ 2 trillion. As of February 2011 , 61% of worldwide investment in hedge funds came from institutional sources. In June 2011,

8374-471: The first hedge fund. The sociologist Alfred W. Jones is credited with coining the phrase " hedged fund" and is credited with creating the first hedge fund structure in 1949. Jones referred to his fund as being "hedged", a term then commonly used on Wall Street to describe the management of investment risk due to changes in the financial markets . Jones also developed the popular 2-and-20 structure of hedge funds, in which hedge funds charged investors

8480-579: The five years required to build the Kenney Dam, the hydropower plant under Mt. Dubose at Kemano , a 250,000 tpy aluminum smelter, a year-round deepwater port, a townsite designed for a population of 50,000, and a paved highway to the outside world. As a result of this project other companies saw the potential of the area, resulting in further industrial development in the Kitimat valley. On 1 October 2018, Royal Dutch Shell and its Asia partners gave formal approval to an estimated $ 40 billion investment into

8586-595: The flooding caused by the creation of the new reservoir, with the destruction of homesteads, villages, burial grounds, millions of board feet of prime timber, and the disruption of prime fish habitat on the Nechako River . In the late 1980s, the company began work on the Kemano Completion Project which would have doubled the generating capacity of the Kemano plant. After Alcan had already bored

8692-585: The four main categories, there are several strategies that do not entirely fit into these categories. For an investor who already holds large quantities of equities and bonds, investment in hedge funds may provide diversification and reduce the overall portfolio risk. Managers of hedge funds often aim to produce returns that are relatively uncorrelated with market indices and are consistent with investors' desired level of risk. While hedging can reduce some risks of an investment it usually increases others, such as operational risk and model risk , so overall risk

8798-652: The fund and investors. According to the Financial Times , "big hedge funds have some of the most sophisticated and exacting risk management practices anywhere in asset management." Hedge fund managers that hold a large number of investment positions for short periods are likely to have a particularly comprehensive risk management system in place, and it has become usual for funds to have independent risk officers who assess and manage risks but are not otherwise involved in trading. A variety of different measurement techniques and models are used to estimate risk according to

8904-654: The fund trades in diversified markets, or sector specialists such as "systematic currency", in which the fund trades in foreign exchange markets or any other sector specialisation. Other sub-strategies include those employed by commodity trading advisors (CTAs), where the fund trades in futures (or options ) in commodity markets or in swaps. This is also known as a "managed future fund". CTAs trade in commodities (such as gold) and financial instruments, including stock indices . They also take both long and short positions, allowing them to make profit in both market upswings and downswings. Most global macro managers tends to be

9010-436: The fund's net asset value , whereas private-equity funds generally invest in illiquid assets and return capital only after a number of years. Other than a fund's regulatory status, there are no formal or fixed definitions of fund types, and so there are different views of what can constitute a "hedge fund". Although hedge funds are not subject to the many restrictions applicable to regulated funds, regulations were passed in

9116-464: The fund's leverage, liquidity, and investment strategy. Non-normality of returns, volatility clustering and trends are not always accounted for by conventional risk measurement methodologies and so in addition to value at risk and similar measurements, funds may use integrated measures such as drawdowns . In addition to assessing the market-related risks that may arise from an investment, investors commonly employ operational due diligence to assess

9222-418: The hedge fund management firms with the greatest AUM were Bridgewater Associates (US$ 58.9 billion), Man Group (US$ 39.2 billion), Paulson & Co. (US$ 35.1 billion), Brevan Howard (US$ 31 billion), and Och-Ziff (US$ 29.4 billion). Bridgewater Associates had $ 70 billion in assets under management as of March 2012 . At the end of that year, the 241 largest hedge fund firms in

9328-402: The hedge fund manager must identify an upcoming event that will increase or decrease the value of the company's equity and equity-related instruments. Other event-driven strategies include credit arbitrage strategies, which focus on corporate fixed income securities; an activist strategy, where the fund takes large positions in companies and uses the ownership to participate in the management;

9434-733: The largest. Several freeways connect lower mainland communities together. The backbone of Vancouver Island's highway network is the Highway 19 which along with a portion of Highway 1 forms the Island Highway . The Island highway is a mix of 4-lane freeway, 4 lane arterial highway and 2 lane highway running roughly along the east shore of Vancouver Island. Access to the west coast of Vancouver Island can be accomplished by crossing mountain passes on Highway 4 to Tofino and Highway 28 to Gold River . Thousands of other roads ranging from small freeways near Victoria to logging roads exist all over

9540-539: The management fee from larger funds can generate a significant part of a manager's profits, and as a result some fees have been criticized by some public pension funds, such as CalPERS , for being too high. The performance fee is typically 20% of the fund's profits during any year, though performance fees range between 10% and 50%. Performance fees are intended to provide an incentive for a manager to generate profits. Performance fees have been criticized by Warren Buffett , who believes that because hedge funds share only

9646-456: The market overall. Hedge fund managers can use various types of analysis to identify price discrepancies in securities, including mathematical, technical , or fundamental techniques. Relative value is often used as a synonym for market neutral , as strategies in this category typically have very little or no directional market exposure to the market as a whole. Other relative value sub-strategies include: In addition to those strategies within

9752-592: The market, the particular instrument use, the market sector the fund specializes in ( e.g. , healthcare), the method used to select investments, and the amount of diversification within the fund. There are a variety of market approaches to different asset classes , including equity , fixed income , commodity , and currency . Instruments used include equities, fixed income, futures , options , and swaps . Strategies can be divided into those in which investments can be selected by managers, known as "discretionary/qualitative", or those in which investments are selected using

9858-450: The most power-intensive of all industries—the aluminum smelting industry. The company built a dam, 16 km (10 mi) tunnel, powerhouse, 82 km (51 mi) transmission line , a deep-sea terminal and smelter . The company also designed, laid out and assisted with the initial construction of the city. At the time, the combined development was considered "the most expensive project ever attempted by private industry." Alcan employed

9964-630: The next decade. Anticipated investment includes an approximately $ 2 billion modernization to the Rio Tinto Alcan facilities and $ 3 billion in the Kitimat liquefied natural gas export development on Haisla Industrial Land at Bish Creek. The export facility would see natural gas piped in from the Western Canadian Sedimentary Basin (particularly from shale gas developments such as the Montney and Horn River ) and shipped to Asian markets. The LNG Canada project,

10070-413: The one-year Treasury bill rate plus a spread. A "soft" hurdle means the performance fee is calculated on all the fund's returns if the hurdle rate is cleared. A "hard" hurdle is calculated only on returns above the hurdle rate. By example the manager sets a hurdle rate equal to 5%, and the fund return 15%, incentive fees would only apply to the 10% above the hurdle rate. A hurdle is intended to ensure that

10176-499: The opportunity for larger gains is weighed against the possibility of greater losses. Hedge funds employing leverage are likely to engage in extensive risk management practices. In comparison with investment banks , hedge fund leverage is relatively low; according to a National Bureau of Economic Research working paper, the average leverage for investment banks is 14.2, compared to between 1.5 and 2.5 for hedge funds. Some types of funds, including hedge funds, are perceived as having

10282-481: The possibility that the merger or acquisition will not go ahead as planned; hedge fund managers will use research and analysis to determine if the event will take place. Special situations are events that impact the value of a company's stock, including the restructuring of a company or corporate transactions including spin-offs , share buy backs , security issuance/repurchase, asset sales, or other catalyst-oriented situations. To take advantage of special situations

10388-491: The profits and not the losses, such fees create an incentive for high-risk investment management. Performance fee rates have fallen since the start of the credit crunch . Almost all hedge fund performance fees include a " high water mark " (or "loss carryforward provision"), which means that the performance fee only applies to net profits ( i.e. , profits after losses in previous years have been recovered). This prevents managers from receiving fees for volatile performance, though

10494-416: The risk that error or fraud at a hedge fund might result in a loss to the investor. Considerations will include the organization and management of operations at the hedge fund manager, whether the investment strategy is likely to be sustainable, and the fund's ability to develop as a company. Since hedge funds are private entities and have few public disclosure requirements, this is sometimes perceived as

10600-454: The same types of risk as other investment classes, including liquidity risk and manager risk. Liquidity refers to the degree to which an asset can be bought and sold or converted to cash; similar to private-equity funds, hedge funds employ a lock-up period during which an investor cannot remove money. Manager risk refers to those risks which arise from the management of funds. As well as specific risks such as style drift , which refers to

10706-613: The services of city planner Clarence Stein in order to ensure the community design facilitated an environment that would attract and retain workers, although Alcan intended it to not be a company town . Today, Kitimat benefits from the quality of planning resulting from the Garden City design concept . Stein's design kept industry well separated from the community with large areas for expansion. He also created looped streets surrounding an urban city centre mall and linked by over 45 km (28 mi) of walkways connecting to all areas of

10812-490: The top manager earned $ 3 billion, the tenth earned $ 210 million, and the 30th earned $ 80 million. In 2011, the average earnings for the 25 highest-compensated hedge fund managers in the United States was $ 576 million while the mean total compensation for all hedge fund investment professionals was $ 690,786 and the median was $ 312,329. The same figures for hedge fund CEOs were $ 1,037,151 and $ 600,000, and for chief investment officers were $ 1,039,974 and $ 300,000, respectively. Of

10918-469: The total length of the British Columbia Coast is over 25,725 km (15,985 mi), or approximately 10% of the entire Canadian coastline. This coastal geography is shared with the neighbouring U.S. states of Alaska and Washington . The dominant landforms are the Insular Mountains of Vancouver Island and Haida Gwaii , and the Coast Mountains that stretch along the entire length of

11024-464: The twenty-first century saw the District of Kitimat in court with the Provincial Government over the electricity rights granted to Alcan and its obligations to the Province and to the District. Rio Tinto Alcan plans to increase the output of its Kitimat smelter from 250,000 MT/Yr to 400,000 MT/Yr and initially committed $ 300 million to this effort. Since late 2008, relations between Rio Tinto Alcan and

11130-404: The underlying investment opportunity and risk are associated with an event. An event-driven investment strategy finds investment opportunities in corporate transactional events such as consolidations, acquisitions , recapitalizations , bankruptcies , and liquidations . Managers employing such a strategy capitalize on valuation inconsistencies in the market before or after such events, and take

11236-743: The use of leverage and derivative instruments . In the United States, financial regulations require that hedge funds be marketed only to institutional investors and high-net-worth individuals . Hedge funds are considered alternative investments . Their ability to use leverage and more complex investment techniques distinguishes them from regulated investment funds available to the retail market, commonly known as mutual funds and ETFs . They are also considered distinct from private equity funds and other similar closed-end funds as hedge funds generally invest in relatively liquid assets and are usually open-ended . This means they typically allow investors to invest and withdraw capital periodically based on

#322677