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HFR data reveal that $152 billion of capital was withdrawn by hedge fund investors in the fourth quarter of 2008 – the largest withdrawal in a quarter on record. Estimates that hedge fund assets would reach $2.25 trillion by 2010 now seem far too optimistic. HFR estimates that the industry at present has $1.4 trillion in assets. The HFRI Fund Weighted Composite Index fell by 18.3% for all of 2008, only the second calendar-year decline since 1990.

The primary market share of the top 10 global debt houses declined substantially in 2008, according to full-year figures released last month by Dealogic.

TraderTools has secured an additional $7.5 million of funding. Edison Venture Fund put in $7 million, with the remainder raised from the company’s management. Edison is a specialist at providing capital to companies in their expansion stage; it has experience of FX through an investment in online FX specialist Gain Capital. TraderTools says the funding will be used to expand sales, marketing and development of its Liquidity Management Platform.

European Commission digs its heels in over central counterparty.

The UK Treasury is understood to be considering the establishment of a conduit-style fund that would source investment directly from institutional investors such as pension funds and insurance companies to fund its infrastructure investment programme. The UK government would own the conduit and take the first-loss risk in the vehicle. Management of the conduit would be outsourced to a third party – insiders suggest that one of the monoline guarantors is being considered. The conduit could be launched in the next three to six months.

Following its takeover of Merrill Lynch, some clarification has started to emerge from Bank of America about its management structure. Chris Allington and Chris Vogel are co-heads of G10 currency trading; Peter Antico is head of Americas rates and local-currency trading; Luke Halestrap is head of EMEA rates and local-currency trading; Chris Hodson is head of global rates electronic trading and market making; Mitch Nadel is head of Japan/Australia rates and currency trading; Nicolas Rabeau and Neh Thaker are co-heads of global rates and currencies exotics trading; Jin Su is head of Asia-Pacific rates and currency trading excluding Japan/Australia; and Frank Rawlins and Behnouche Mostachfi are co-heads of global FX options trading.

While the structured products business is having a tough time as a result of poor performance and lower demand, the flow business is enjoying record volumes, particularly for exchange-traded options.

Why Rohner left UBS

As the ban on shorting 34 financial stocks lifted in the UK on January 16, shares at first rose but then fell sharply the following week after more bad news from banks. The Financial Services Authority is forcing hedge funds to disclose short sales of financials. Lansdowne Partners admitted to shorting Barclays Bank on one day that the bank lost 25% of its value. There were only six reports of short sales of more than 0.25% of a company. Barclays and RBS, however, saw much of their value wiped out in January as stock was sold off. The Australian Securities and Investments Commission extended its ban on shorting financials that it imposed last September. The ban will remain in place until March 6.

The US Commodity Futures Trading Commission is continuing its efforts to put an end to some of the sharper practices that have plagued the country’s retail foreign exchange market. On January 15, the regulator announced it had charged James Ossie of Atlanta, Georgia, and his company, CRE Capital Corporation (CRE) of Alpharetta, Georgia, with operating a Ponzi scheme. The CFTC claims that the scam sucked in more than 100 apparent clients and involved about $25 million. Neither Ossie nor CRE had ever been registered with the CFTC.

Despite remaining a largely centrally planned economy, Belarus has not been immune to the fallout from the global credit crunch and the associated macroeconomic slowdown. At the beginning of the year the country was forced to devalue the Belarussian rouble by 20% to BR2,650 to the dollar and raise its key refinancing rate to 14% from 12%.

Retail FX provider FXCM has launched a new platform, Active Trader, which it says is aimed at the higher end of the market. The platform has greater depth of book transparency and, unlike most other retail offerings, charges commission, determined by volumes, to trade. FXCM says this enables it to pass on tighter spreads from its liquidity providers. Accounts will require minimum deposits of $25,000 or a history of active trading.