The title says it all. We are half way through the second day of trading for OZM the IPO of Och-Ziff Capital Management. Och-Ziff is a large hedge fund company that decided to cash out to the public. Following FIG and BX OZM has sold off as well and is currently below its offering price. Only time will tell how hedge funds work out as a stock market investment but for now they have been bad.
Our guess is just like any industry the good ones will thrive over time and bad ones will not but the timing on going public couldn’t have been much worse. Everything has gone down lately so going public in the middle of all the turmoil didn’t help it out much. Several other fund companies have indicated interest in going public so only time will tell. One interesting thing is that we have not heard about any of the “legendary managers” wanting to go public. Bruce Kovner, Paul Tudor Jones, Stanley Druckenmiller, George Soros, and Nick Roditi. No doubt the thought has crossed their mind but we haven’t seen anything in the press showing interest.