Hedge Funds Performance Politics & Regulation

Diamondback, Level Global among pension darlings

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The firms raided yesterday by the FBI manage money for some of the country’s largest pension plans, in the popular direct investing gambit. So far, none of the funds has been put on watch.

Diamondback Capital Management and Level Global Investors, two of the SAC Capital Advisors-related hedge funds raided yesterday by the Federal Bureau of Investigation, are among the funds heavily favored by public pension plans—including large pensions for New York State retirees and Texas teachers—that have chosen to invest directly into hedge funds.

Diamondback, Level Global and Loch Capital Management were each raided yesterday by the FBI as part of a large government probe of insider trading activities. The FBI said in a statement that it had obtained court-authorized federal search warrants as part of a continuing criminal investigation. Today,