Goldman pounded by hedge fund rumours by Ioana Madalina Tantareanu

In the first quarter, Goldman's incentive fees from asset management fell 78 percent from a year earlier, to $23 million, reflecting poor performance.In the second quarter, incentive fees fell by 87 percent.Outside investors responded by pulling out. Goldman's net flows of money into alternative investments were nil in the second quarter, compared with $6 billion received a year ago. Speculation that two of its hedge funds had fallen sharply in recent weeks and were selling down positions were on offensive to Goldman Sachs Group , known for its Midas touch. Amid a third day of speculation the investment bank was selling off parts of its portfolio, Goldman insisted that it was "business as usual" at Global Alpha, its flagship $9 billion (4.4 billion pound) macro hedge fund. Speculations that a second hedge fund, North American Equity Opportunities has also been whipsawed by recent market turbulence markets and forced to sell down positions, were also faced by the WallStreet giant. The subject of talk for several days was Global Alpha that had been hammered by volatile markets and fell by 6 percent last year.Goldman on Wednesday denied talk that it was liquidating the fund and declined further comment. A source familiar with the fund said that the Global Alpha fund was down about 16 percent this year, including a 12 percent drop in the past two weeks. Moreover, North American Equity Opportunities was down more than 15 percent this year through July 27, even if it started the year with about $767 million in assets. In Goldman's results in recent quarters was put a dent by weak performance at Alpha. Poor performance was reflected by Goldman's incentive fees from asset management fell 78 percent from a year earlier, to $23 million in the first quarter and in the second quarter incentive fees fell by 87 percent, comparing with $6 billion received a year ago.

by Ioana Madalina Tantareanu for PocketNews (http://pocketnews.tv)

PocketNews is a new real-time news broadcaster delivering the latest and hottest news right to your pocket ! With global clients who want to be kept up to date, PocketNews is everyone's way of keeping in touch with the World.