Ron Senator, CEO, Sphera–largest hedge fund in Israel

I recently saw Ron Senator, CEO, Sphera Funds Management, speak at the Israeli Business Forum. My brief notes (distributed with permission) follow:

$250m assets under management. Approximately 18% net return since 2001.

Currently low net exposure to markets. We think some of the problems here are not behind us. Israel economy strong, well-developed, no major weaknesses.

However, all major Israeli indices have performed poorly since Dec 07.

A lot of Israeli corporates have gotten into real estate.

Israeli real estate market quite healthy

Defense is a strong sector

Relatively few big Israeli tech success stories. They mainly exit thru M&A. Tend to be conservatively managed, i.e., not much debt. Many are now trading at book value/cash. It’s like 2002 over again.

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Dollar is likely to gain against shekel

A lot of crowded trades in the US ; we’re at a very early stage in Israel .

About 1 dozen hedge funds in Israel. Second-largest is <$100m. Others are $30-50m .

Several large international hedge funds are active in the Israeli market on an opportunistic basis

18 professionals

Fees: 1.5% and 20%. One-year lockup. Typical minimum: $ 500k.

Always demand for US-trained people.

Annual reports in Israel in some cases give more detail than US 10Ks.

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