Looking back on a shimmer of light in a tough year for Stark

By Rob Copeland

Tue Mar 26, 2013


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Absolute Return also revisits Dow Kim's heady hopes for a launch.


One year ago

>> Stark Investments had begun trading with a new Mortgage Opportunities Fund to invest in the hot securitized space.

The fund reached close to $100 million by midyear, and in a positive environment for structured credit the principals decided to take the profits and liquidate by yearend, a person close to the fund said. Exact performance information was not available.

Last year was a difficult time for the firm, which liquidated its flagship multistrategy funds in the summer (see performance here) and dropped from $2.4 billion at the start of 2012 to below $1 billion as of early 2013, according to the Absolute Return Billion Dollar Club ranking.

Dave Millar, an external spokesman for the firm at RLM Finsbury, declined to comment.

See also: Credit managers scoff at great rotation bond doomsday - SkyBridge: MBS trade far from over - Mortgage investors mint mega year

Five years ago

>> Dow Kim, former co-president of Merrill Lynch's global markets and investment banking group, was struggling to launch Diamond Lake Investment Group.

At the time, expectations were already being lowered from a potential $5 billion start to as low as $500 million. Even that turned out to be optimistic. He had lost financial backing from Merrill, but was believed to be seeking another anchor investor. By August 2008 the plans were officially toast.

Three years later, Kim was sued by former UBS trader Namuk Cho, who said he had been hired for Diamond Lake and promised a $2 million payday. That suit is moving through the legal system, and as recently as last week the duo were still swapping motions.

In an emailed response to questions, Kim said he was currently retired from the industry.

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