The 20 hedge-fund dealmakers who are beating VCs at their own game

Arielle Zuckerberg, Glen Kacher, John Curtius, and Alex Sacerdote on a blue background with money and investing icon imagery.
From left to right: Glen Kacher, Arielle Zuckerberg, John Curtius, and Alex Sacerdote.

  • For decades, hedge funds have dominated public markets.
  • Now funds like Tiger Global, D1, and Coatue are investing billions into top startups.
  • Insider lists those leading the charge into unicorn funding rounds.
  • See more stories on Insider’s business page.

It’s easy for investors to take big bets on companies like Google and Facebook. It’s much more challenging to find the fledgling startup that is set to become the next industry titan.

For decades, hedge funds have dominated public markets, through activists demanding major changes at blue-chip stocks or quants supercharging the speed of trading. Now managers are turning toward private markets, investing billions into top startups.

Managers like Tiger Global are pumping so much into private markets that traditional venture capitalists are grumbling that they can’t find any deals for their own clients, and more firms are expected to get in.

Insider compiled a list of the top 20 dealmakers at the most important shops.

Subscribe to see the full list here: 20 hedge-fund dealmakers who are beating VCs at their own game by pumping billions into the world’s hottest private companies

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3 reasons why the stock market could enter risk-on mode in August after a couple choppy months, according to Fundstrat’s Tom Lee

Tom Lee
  • The stock market is primed to enter risk-on mode in August following a sideways summer chop, Fundstrat’s Tom Lee said in a note on Friday.
  • Lee pointed to an imminent peak in Delta-variant cases and surging bitcoin prices as reasons to expect upside in stocks next month.
  • These are the 3 reasons stocks are primed to move higher in August, according to Fundstrat.
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After weeks of a sideways “chop” in certain stock sectors, August could be the month risk-on mode returns for the market, Fundstrat’s Tom Lee said in a note on Friday.

Lee highlighted that since early June, epicenter stocks collapsed while a handful of names in the technology sector moved higher and propped up broad market indices. The steep drop in financial, energy, and hotel/cruise stocks came amid a surge in COVID-19 cases caused by the delta variant.

Historically, not much money has been made in stocks in the month of August, especially when markets delivered strong gains in the first half of the year.

“August is not generally a great month for stocks. The win-ratio is low at 54% overall,” Lee said, citing an analysis of data going back to 1928. And when the S&P 500 is up more than 13% in the first half of the year, August returns average -0.50%, according to the analysis.

But these 3 reasons suggest to Lee that the stock market can buck its historical trend and enter risk-on mode.

1. “Seasonal analysis suggests USA Delta spike could end in next 10-12 days, or sooner.”

Lee highlighted that low vaccinated areas are seeing far worse seasonality in COVID-19 spread than higher vaccinated areas. An analysis of COVID-19 in the 5 largest counties in Florida suggest that a peak could be right around the corner, within the next week or two, according to Fundstrat.

“Florida has been among the worst USA Delta outbreaks. Thus, this is a positive inflection, if the cases turn down next week,” Lee said.

2. “Pfizer just released data showing 3rd shot significantly boosts delta antibody response by 5x.”

Data from Pfizer suggests that a third dose of its COVID-19 vaccine leads to a 100-fold increase in Delta neutralizing antibodies relative to a non-vaccinated person,, and a 5-fold increase relative to the second dose, Lee highlighted.

“The case for boosters is very high and is a sound policy strategy,” Lee said, while acknowledging the main challenge is convincing about a third of the US that has yet to be vaccinated to get their shots.

“But this should not change the fact that the Delta risk to the US is strongly diminished. And thus, we are seeing positive tilt on the Delta variant risk,” Lee explained.

3. “Bitcoin, the global non-US ‘risk-on’ proxy is pushing above $40,000 = risk on!”

Bitcoin is set to post its first positive monthly gain in four months, and its best week since February, as the cryptocurrency rallied more than 30% from $30,000 to $40,000. And Lee still expects bitcoin to close above $100,000 in 2021, representing potential upside of 163% from current levels.

“Bitcoin is the risk-on asset for emerging market investors, more than equities. Risk appetite seems to be returning in the past week,” Lee said, adding that the rally is occurring as a lot of bad news is priced in following China’s crackdown.

“So for now, we are upgrading our baseline expectations for August. Instead of ‘chop’, it’s ‘upside bias,” Lee concluded.

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Nominations for Insider’s next class of Wall Street rising stars are open. Here’s how to apply.

We're looking for the next crop of rising stars on Wall Street.
We’re looking for the next crop of rising stars on Wall Street.

  • Insider is putting together a power list of the young talent on Wall Street.
  • We want to spotlight the standouts in investment banking, investing as well as sales and trading.
  • Please submit your ideas through this form by August 6th.

We’re seeking nominations for Insider’s list of rising stars on Wall Street, and we want to hear from you.

Submit your suggestions below or via this form.

We’re looking for the leaders of tomorrow, those making notable contributions or accomplishments and setting themselves apart from their class in investment banking, investing, and sales and trading.

In the past, we’ve had people with a variety of roles and experiences from companies including Apollo Global Management, Blackstone, Goldman Sachs, BlackRock, and the New York Stock Exchange.

Take a look at our 2020 list here.

Criteria and methodology

Our selection criteria: We ask that nominees be 35 or under as of September 30, 2021, based in the US, work front-office roles, and stand out from their peers. Editors make the final decisions.

Please make your submission below or through this form by August 6th to have your selection considered for the list. Please be as specific as possible in your submission.

Please email Michelle Abrego at mabrego@insider. com with any questions or issues submitting your nominations.

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LendingClub soars 57% to 3-year high after reporting its most profitable quarter ever

trader, NYSE
  • LendingClub soared as much as 57% after second quarter earnings results revealed its most profitable quarter ever.
  • The personal loan provider saw revenue soar 406% to $204 million, easily beating analyst estimates.
  • Even with shares hitting a three-year high, LendingClub is still down 83% from its record 2014 high.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Shares of LendingClub soared as much as 57% on Thursday after the personal loan provider reported second quarter earnings that revealed its most profitable quarter ever.

LendingClub’s revenue soared 406% year-over-year and massively beat analyst estimates, along with its earnings per share.

Here are the key numbers:

Revenue: $204 million, versus analyst estimates of $129 million.
Earnings per share: $0.09, versus analyst estimates of -$0.40.

LendingClub expects the surprise profit in the second quarter to spill over into the third quarter, as it guides for third quarter net income of $10 million-$15 million.

LendingClub expects $9.8 billion to $10.2 billion of loan originations in its fiscal year of 2021, along with net revenue of $750 million to $780 million. That’s higher than its previous revenue guidance of $500 million to $530 million. Analysts were only expecting $583 million in revenue for the year.

Analysts were impressed with the results, with many increasing their price targets on the company. Credit Suisse, which increased its price target to $28 per share but remained Neutral on the company, said interest income from LendingClub Bank could represent the start of an “enhance earnings trajectory for the business.”

While shares hit a three-year high on Thursday, surging to $25.56, they were still down 83% from its record high of $146 reached shortly after its IPO in 2014.

LendingClub stock chart
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Family office launch guide: who to know when you’re opening or hiring for a family office

Todd Angkatavanich, Natasha Pearl, Bill Bjiesse, and Lisa Featherngill on a pink background.
Todd Angkatavanich, Natasha Pearl, Bill Bjiesse, and Lisa Featherngill.

  • As global wealth surges, more people want to start family offices to take control of their finances.
  • Insider spoke to more than a dozen industry insiders to compile a list of 21 must-know experts.
  • See more stories on Insider’s business page.

Whether they’re rags-to-riches entrepreneurs or old-money heirs, many of the wealthy have created their own family offices to oversee their assets.

Citi estimates that as many as 15,000 family offices have been created in the past two decades alone.

Insider spoke with more than a dozen family-office professionals to find out who the wealthy go to when deciding to set up their own shops. Whether they’re lawyers or wealth managers, here are 21 must-know family-office experts.

You can read our full story if you’re an Insider subscriber: These are the 21 advisors, accountants, and lawyers to know if you’re thinking about starting your own family office

Insider also rounded up some of the must-know executive recruiters in the space, as hiring top talent is key to maintaining wealth that lasts for generations.

Meet 8 top recruiters scouting talent for family offices as the secretive wealth managers to the world’s richest look to supercharge their investing prowess

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Alphabet blows past Wall Street’s quarterly earnings expectations as search and YouTube ad revenue surge

Sundar Pichai
Google CEO Sundar Pichai.

  • Google’s parent Alphabet announced its Q2 earnings Tuesday, beating Wall Street expectations.
  • Alphabet reported $61.9 billion in total revenue versus $56.1 billion expected by analysts.
  • Google’s ad services brought in $57.1 billion, while Cloud revenue grew to $4.6 billion.
  • See more stories on Insider’s business page.

Alphabet blew past Wall Street’s second-quarter earnings expectations as the company continued benefit from the massive uptick in digital commerce during the pandemic.

Google’s parent company brought in $61.9 billion in total revenue during the quarter, up 62% year-over-year, versus $56.1 billion expected by analysts.

A year after its first-ever revenue decline, Google’s ad business skyrocketed in Q2 2021 with $57.1 billion in revenue, up 69% year-over-year, driven largely by Google search ads, which brought in $35.8 billion in revenue.

The company said advertising revenue at its YouTube division rose 84% year-over-year to $7 billion.

Google Cloud earned $4.6 billion in revenue and cut its operating loss to $591 million in Q2, its third-straight quarter of revenue growth since Google started separately reporting the financial performance of its cloud division in Q4 2020.

Here’s what Alphabet reported, compared to what analysts expected, according to Bloomberg.

  • Total revenue: $61.88 billion (Expected $56.03 billion, according to Yahoo Finance)
    • Revenue minus TAC: $50.95 billion (Expected $46.08 billion)
    • Google services revenue: $57.07 billion
    • Google Cloud revenue: $4.63 billion (Expected $4.34 billion)
  • Net income: $18.53 billion (Expected $13.05 billion)
  • Earnings per share (GAAP): $27.26 per share (Expected $19.35)

Tuesday marked Google’s first earnings report since announcing in March that it would make a major shift away from precisely tracking individual users based on their internet activity, viewed by some experts as a move to entrench its dominance of the digital ads market.

Google’s earnings also come as the company faces multiple antitrust lawsuits and likely a tougher regulatory environment under Biden appointees like Federal Trade Commission chair Lina Khan, as well as criticism from employees over its sexual-misconduct policies and dismantling of its AI ethics team following the departure of Timnit Gebru.

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What to know about swing trading and how to minimize risks of this speculative trading strategy

Young woman with her puppy dog lying on the hammock.
If you’re considering swing trading, you’ll need to have the skills required to analyze charts and numbers to be successful.

  • Swing trading is a speculative strategy where investors buy and hold assets to profit from expected price moves.
  • Swing traders leverages technical analysis to determine entry (buy) and exit (sell) points.
  • Swing traders are exposed to gap risk, where a security’s price changes while the market is closed.
  • Visit Insider’s Investing Reference library for more stories.

Investors approach the stock market with a variety of goals. Many invest for the long-term, seeking to build wealth over time, while others trade for short-term profits – and many people do both. There are a variety of strategies for trading, but one of the most accessible to newcomers is swing trading.

Unlike day trading, where trading is extremely fast paced, swing trading is slower. This strategy is a great way to understand market movements and dip your toe into technical analysis. Here’s what the curious trader should know.

What is swing trading?

Swing trading is a trading strategy where investors buy a stock or some other asset and hold it – known as holding a position – for a short period of time (usually between a few days and up to a several weeks) in the hopes of turning a profit.

The goal of the swing trader is to capture a portion of any potential price movement or “swing” in the market. Individual gains may be smaller as the trader focuses on short-term trends and seeks to cut losses quickly. However, small gains achieved consistently over time can add up to an attractive annual return.

How does swing trading work?

The swing trader analyzes patterns in trading activity to buy or sell a stock in order to capitalize on price movements and momentum trends of stocks, typically, focusing on large-cap stocks since they are the most heavily traded. Because these stocks have high trading volumes, they offer investors insight into how the market perceives the company and their security’s price movements. This active trading offers the information necessary for what’s called technical analysis, which we’ll cover in the next section.

As with any style of trading, swing trading carries plenty of risk. Swing traders are exposed to several types of risk, the most common being gap risk, where a security’s price rises or falls significantly based on news or events that occur while the market is closed, whether overnight or during a weekend.

The opening price will reflect the shock of any unexpected news. The longer the market is closed, the greater the risk. Abrupt changes in the market’s direction also pose a risk, and swing traders may miss out on longer-term trends by focusing on shorter holding periods.

Example of swing trading

Let’s take a look at a real-world example of how a swing trader may analyze Amazon’s stock and determine when to buy or sell.

Candle stick chart example of Swing Trade in Amazon (AMZN)
Amazon stock from March to July 2021.

The candlestick chart above illustrates the “cup and handle” consolidation pattern, where the cup is u-shaped and the handle points slightly downward. This pattern is considered a bullish signal.

If a swing trader wants to make a profitable trade in Amazon, they would likely purchase the stock at the top of the “cup,” at or above the most recent high of $3,555. They should place a stop-loss order at the most recent low in the cup handle ($3,395). Therefore, the risk – the maximum loss on the trade – is $160 ($3,555 – $3,395 = $160).

At the recommended reward/risk ratio of 3:1, which is considered good, you’d need to sell at $480 (3 x $160 = $480) above the entry price, or $4,035 ($3,555 + $480).

Why risk management is critical in swing trading

Risk management is the most essential component in a successful swing trading strategy. Traders should choose only liquid stocks and diversify positions among different sectors and capitalizations.

Mike Dombrowski, head of capital markets at InterPrime Technologies, emphasizes the importance of risk management, saying that “each position should be roughly 2%-5% of total trading account capital. The most aggressive and professional traders may go up to 10% per position. That means a portfolio of five concentrated swing trades would represent 10%-25% of total trading account capital on average.

Having cash in reserve allows you to add to the best-performing trades to help generate larger winners. As always, the key to swing trading is to minimize losses.” He also notes that a desirable reward/risk ratio is 3:1, or 3 times the amount at risk.

Stop-loss orders are a vital tool in managing risk. When a stock falls below the stop price (or rises above the stop price for a short position), the stop-loss order converts to a market order, which is executed at the market price. With stop losses in place, the trader knows exactly how much capital is at risk because the risk of each position is limited to the difference between the current price and the stop price.

A stop loss is an effective way to manage risk per trade

Swing trading strategies

Traders can deploy many strategies to determine when to buy and sell based on technical analysis, including:

  • Moving averages look for bullish or bearish crossover points
  • Support and resistance triggers
  • Moving Average Convergence/Divergence (MACD) crossovers
  • Using the Fibonacci retracement pattern, which identifies support and resistance levels and potential reversals

Traders also use moving averages to determine the support (lower) and resistance (upper) levels of a price range. While some use a simple moving average (SMA), an exponential moving average (EMA) places more emphasis on recent data points.

For example, a trader may use 9-, 13- and 50-day EMAs to look for crossover points. When the stock price moves above, or “crosses” the moving averages, this signals an upward trend in price. When a stock price falls below the EMAs, it’s a bearish signal and the trader should exit long positions and potentially put on shorts.

Market extremes make swing trading more challenging. In a bull or bear market, actively traded stocks do not exhibit the same up-and-down movements within a range as they do in more stable market conditions. Momentum will propel the market up or down for an extended period. “[Traders should] always trade in the direction of the trend, taking long positions in bull markets and shorts when the markets trend downward,” says Dombrowski.

Swing trading vs. day trading

Swing trading and day trading have many similarities, but the most marked difference is the frequency of trades. Swing traders focus on short-to-medium term positions while day traders close out their positions at the end of each trading day. Day trading is a full-time job, requiring the trader to monitor market movements throughout the day and trade frequently. A swing trader can manage and trade on the side while still maintaining a full-time job.

Let’s look at the principal differences.

Swing trading Day trading
Trading frequency Mulitple trades per week Multiple trades per day
Time required to trade Can be done periodically Requires constant attention
Number of transactions Fewer transactions Many intra-day transactions
Profit potential Gains and losses accumulate slowly Gains and losses accumulate more quickly
Trading outlet Brokerage account Specialized trading software
Costs Lower Higher

The financial takeaway

Swing trading is an easy way for new traders to get their feet wet in the market, with traders typically starting with $5k-$10k, although less is acceptable. The cardinal rule though is that this capital should be money the investor can afford to lose. Even with the strictest risk management, the unexpected is always possible.

More importantly, swing trading doesn’t demand the same level of active attention as day trading, so the swing trader can start slowly and build the number of trades over time. But it does require the investor to take a deep dive into technical analysis, so an aptitude for charts and numbers is necessary.

For traders willing to spend time researching stocks and developing an understanding of technical analysis, swing trading offers the potential to accumulate attractive profits, slowly but steadily, over time.

Trading and investing are two approaches to playing the stock market that bring their own benefits and risksShort selling is a high-risk but high-reward trading strategy that profits from a stock price’s fallA long position means you buy a stock or stock option in the bullish belief its value will increase over timeMargin trading means buying stocks with borrowed funds – it’s riskier than paying cash, but the returns can be greater

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Cathie Wood’s Ark Invest is rapidly shedding Chinese stocks as Beijing’s regulatory crackdown expands

Cathie Wood
Cathie Wood is the CEO and chief investment officer of ARK Invest, which runs three of the highest-returning stock ETFs of the last three years.

Cathie Wood’s Ark Invest is rapidly shedding its positions in Chinese technology stocks amid an ongoing regulatory crackdown by Beijing.

On Friday, Ark Invest sold the last remaining shares of its stake in Tencent, and is quickly shedding KE Holdings, an online property website based in China, and, according to Ark’s daily trading updates. KE Holdings fell as much as 26% on Monday.

The latest regulatory crackdown in China hit education and tutoring companies on Friday, with companies like TAL Education, Gaotu Techedu, and others plunging more than 50%. China said it is banning tutoring on holidays and weekends for students to lessen the burden of schoolwork, which makes up a big chunk of the tutoring companies business.

The China’s increased scrutiny on certain businesses began late last year following the abrupt cancellation of Ant Group’s IPO. A clampdown on the fintech giant then spread to Alibaba and Tencent earlier this year, with both getting hit with anti-monopoly measures and fines.

Since then, ride-hailing giant Didi, which went public last month, has been hit with regulatory actions by China amid data-security concerns. That crackdown on Didi led to TikTok parent ByteDance shelving its planned IPO.

All in all, the uncertain regulatory environment for Chinese stocks has led to an investor exodus from popular names like Tencent and Alibaba, which were both down as much as 10% and 7% in Monday trades, respectively.

In a webinar with investors earlier this month, Wood said a “valuation reset” among Chinese stocks is occurring, and that their valuations could remain depressed for some time.

“From a valuation point of view, these stocks have come down and again from a valuation point of view, probably will remain down,” Wood said.

On the flip side, Wedbush analyst Dan Ives thinks losses for Chinese tech stocks could lead to gains in US mega-cap tech stocks, as investors rotate out of once popular names like Alibaba and Tencent in favor of Amazon, Apple, Microsoft, and Google.

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Power players transforming alternative investments at top wealth and asset managers

private markets
  • Mainstream retail investors are trying to get into private market investments.
  • Wealth and asset management firms are trying to meet clients’ demand with new products and hires.
  • Here are some of the people connecting firms and investors with alternative investments.

Investors are flocking to the growing world of private markets.

Asset managers and wealth management businesses have been scrambling to keep up with the demand from investors seeking alternatives to mainstream mutual funds and ETFs and looking to tap into big names staying private for longer.

Asset managers are increasingly focused on developing new alternative investments, namely private equity and credit, and getting those out to wealth-management firms, financial advisors, and their clients.

Wealth managers are also seeking to bolster their menus with products that were previously considered too risky or expensive for client access.

Insider has been tracking how firms have been transforming their businesses to meet client demands and the people leading the charge.

Alternative asset managers have been assembling big distribution teams to reach small investors. Here’s a rundown of recent hires and who’s in charge.

Stephanie Drescher of Apollo in front of a gray background, wearing a black and white patterned shirt.
Longtime Apollo executive Stephanie Drescher was recently tapped to lead the firm’s new global wealth management group.

From private equity giants like Apollo Global Management to massive money managers like BlackRock, firms have been ramping up their distribution efforts.

In May, Apollo Global Management formed a unit to sell more of its products to wealth managers and individual investors. That month, Pimco hired executives from Blackstone and Wells Fargo to lead similar efforts. In June, T. Rowe Price poached a Pimco executive to oversee alternatives distribution. And KKR’s private-wealth team has tripled in size in the past year.

Insider has pinpointed key leaders pushing asset managers’ alternatives products to clients.

Read the full story here.

Meet the 9 gatekeepers of alternative investments at the largest wealth firms

wealth management executives alternative investing strategies 4x3
Tim Froehlich, Wells Fargo; Nancy Fahmy, Bank of America; Harry Singh, Rockefeller Capital Management; Robert Picard, First Republic.

Analysts expect wealth managers’ allocations to alternatives for their clients to continue to grow. Morgan Stanley and Oliver Wyman pegged illiquid assets and alternative assets for the ultra-high-net-worth set to increase to $24 trillion in 2024 from $16 trillion in 2020.

Meanwhile, the US government has worked to get private equity and credit into the hands of small-time investors by loosening restrictions on what qualifies a person to invest in the space and allowing private equity in some retirement funds.

An enormous amount of due diligence and risk management is required when allowing more exotic investments into the hands of financial advisers’ clients as they can often be illiquid and less transparent.

Insider has identified major wealth managers’ top executives responsible for overseeing the menu of alternative investments that firms and their advisers can choose for clients.

See the full list here.

Meet 17 BlackRock power players carrying out CEO Larry Fink’s vision to turbocharge the firm’s $222 billion alternative-investments business

blackrock power players alternative investments 4x3
BlackRock execs Edwin Conway, Pam Chan, Terry Simpson, and Anne Valentine Andrews.

The business of offering clients nontraditional assets like private equity, hedge funds, and real estate has become a core part of BlackRock’s long-term growth plan.

Insider broke out the 17 most powerful leaders powering the growth within the asset manager’s alternative-investments business, which oversees about $253 billion in assets as of June.

The alternatives unit accounts for just 3% of BlackRock’s overall assets. But it is still a giant: by assets under management, the business is roughly the size of the private equity firm Carlyle.

Read more here.

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