Sprott Commodity Hedge Fund IPOs

Nice hatchet-job by Bloomberg. I don't recall seeing this kind of blatant "top calling" when numerous real-estate and paper-market funds went public last year. You had to dig deep into the realm of "tin foil hat bloggers" to find that. Note how Bloomberg dredges up two sources for the "con" point of view, and not a single one for "pro". Shoddy journalism, guys.

It's also interesting to see them calling a sale of 15% of the company "cashing out". Yet we are afforded endless calls of "the bottom is in" as money center banks routinely sell off these levels of their own companies -- through dilution:

Sprott Asset Management Inc.'s initial public offering this week will make a billionaire of the hedge fund company's founder, spurring speculation Canada's decade-old commodities boom is ending, investors say.

Eric Sprott's bets on gold and oil pushed his Toronto-based flagship fund to an average return of 27 percent a year since 1998, more than three times the gain of Canada's Standard & Poor's/TSX Composite Index. The fund bought mining stock Thompson Creek Metals Co. in 2006 prior to a rally that lifted it tenfold.

Sprott is cashing out eight years after forming the company that made him one of Canada's best-known speculators. The C$230 million ($226 million) IPO is reminiscent of last June's share sale of U.S. private-equity firm Blackstone Group LP, said Stephen Jarislowsky, chief executive officer of Jarislowsky Fraser Ltd. in Montreal. That IPO preceded a 56 percent decline in monthly takeover volume in the U.S.

At the end of the day, almost nobody likes a commodities boom -- the least among them Wall Street scions who prefer to deal in shadowy paper markets.