Comments on: Cheer Up! Hedge Funds Had a Lousy First Half Too http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-lousy-first.html Mon, 23 Nov 2009 12:59:05 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: Jesse http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-lousy-first.html#comment-10922 Jesse Wed, 09 Jul 2008 22:10:00 +0000 http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-a-lousy-first-half-too/#comment-10922 These rankings and results are wildly inaccurate. GuruFocus, the website that they were drawn from, produced them by tracking the performance of the stocks disclosed on the filings of 1st quarter holdings. Any investments not in stocks aren't accounted for by this (e.g. "Swenson's" portfolio is only 14 positions amounting to less than $500mm), and any changes since 3/31/08 aren't either. These rankings and results are wildly inaccurate. GuruFocus, the website that they were drawn from, produced them by tracking the performance of the stocks disclosed on the filings of 1st quarter holdings. Any investments not in stocks aren’t accounted for by this (e.g. “Swenson’s” portfolio is only 14 positions amounting to less than $500mm), and any changes since 3/31/08 aren’t either.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-lousy-first.html#comment-10919 Anonymous Wed, 09 Jul 2008 20:55:00 +0000 http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-a-lousy-first-half-too/#comment-10919 Hang on a moment, let me get this straight.... I've been in cash (in the UK) for the past 12 months. Average interest on my savings account was about 5%.<br/><br/>So I've outperformed the FTSE 100 and Dow by 25%, and outperformed George Soros by 10%. Hell, I even outperformed Warren Buffet.<br/><br/>Does this mean I should pat myself on the back and wait for the head-hunters to call?<br/><br/>How about my grandmother. Her money is in a tin under her bed. Will she get invited to run her own hedge fund?<br/><br/>Nick Hang on a moment, let me get this straight…. I’ve been in cash (in the UK) for the past 12 months. Average interest on my savings account was about 5%.

So I’ve outperformed the FTSE 100 and Dow by 25%, and outperformed George Soros by 10%. Hell, I even outperformed Warren Buffet.

Does this mean I should pat myself on the back and wait for the head-hunters to call?

How about my grandmother. Her money is in a tin under her bed. Will she get invited to run her own hedge fund?

Nick

]]> By: Peripheral Visionary http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-lousy-first.html#comment-10916 Peripheral Visionary Wed, 09 Jul 2008 20:23:00 +0000 http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-a-lousy-first-half-too/#comment-10916 I think it would be interesting to trace back the source of money for the hedge fund industry. What is the ultimate source of the money that they make?<br/><br/>While there are likely to be multiple sources, I suspect the ultimate source of cash for market speculators is new capital issued in the form of public offerings and securitization. The money paid by investors, both small investors and institutional investors, goes into the flow of money through the markets that the hedge funds skim off of (and make no mistake, this is primarily a skimming operation; only a few funds are genuine suppliers of capital.) As public offerings and securitization have dried up, the ultimate headwaters of the financial stream have gone dry and there will be less money downstream for the hedge funds to skim off.<br/><br/>At this point many funds have switched to commodities speculation, but commodities are a pure zero-sum game, and for every winner there will be a loser--and unlike the investment banks, they do not have other lines of business (e.g. brokerage) to fall back on. I think it would be interesting to trace back the source of money for the hedge fund industry. What is the ultimate source of the money that they make?

While there are likely to be multiple sources, I suspect the ultimate source of cash for market speculators is new capital issued in the form of public offerings and securitization. The money paid by investors, both small investors and institutional investors, goes into the flow of money through the markets that the hedge funds skim off of (and make no mistake, this is primarily a skimming operation; only a few funds are genuine suppliers of capital.) As public offerings and securitization have dried up, the ultimate headwaters of the financial stream have gone dry and there will be less money downstream for the hedge funds to skim off.

At this point many funds have switched to commodities speculation, but commodities are a pure zero-sum game, and for every winner there will be a loser–and unlike the investment banks, they do not have other lines of business (e.g. brokerage) to fall back on.

]]> By: Doc Holiday http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-lousy-first.html#comment-10913 Doc Holiday Wed, 09 Jul 2008 18:53:00 +0000 http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-a-lousy-first-half-too/#comment-10913 I think these losses by these people get to the heart of the matter at hand which is the impending recession, stagflation and liquidity trap -- which are exposing all the greedy retards.<br/><br/> These people play arbitrage games and help manipulate the imbalances between currencies and oil prices, and as they hedge bets, they take risk in betting against each other, which results in more and more losers. This is a great example of late cycle volatility and it is great to see them eat each other alive! I hope that as this list grows in length with increasing losses, that this will correlate with more and more closures, defaults and BKs!<br/><br/>Cheers I think these losses by these people get to the heart of the matter at hand which is the impending recession, stagflation and liquidity trap — which are exposing all the greedy retards.

These people play arbitrage games and help manipulate the imbalances between currencies and oil prices, and as they hedge bets, they take risk in betting against each other, which results in more and more losers. This is a great example of late cycle volatility and it is great to see them eat each other alive! I hope that as this list grows in length with increasing losses, that this will correlate with more and more closures, defaults and BKs!

Cheers

]]> By: theinvestingspeculator http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-lousy-first.html#comment-10909 theinvestingspeculator Wed, 09 Jul 2008 17:04:00 +0000 http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-a-lousy-first-half-too/#comment-10909 More than 50% of fund managers will not beat the market over 10 years. When there is a bear market-few have positve returns. This market will not go up until people take care of the energy problem. The economy is going to by weak until the United States takes care of its biggest problem. One billionaire calls our biggest problem the “Largest transfer of wealth in the history of mankind”. Find out who said it and how we correct it @<br/>www.theinvestingspeculator.com More than 50% of fund managers will not beat the market over 10 years. When there is a bear market-few have positve returns. This market will not go up until people take care of the energy problem. The economy is going to by weak until the United States takes care of its biggest problem. One billionaire calls our biggest problem the “Largest transfer of wealth in the history of mankind”. Find out who said it and how we correct it @
http://www.theinvestingspeculator.com

]]> By: etc http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-lousy-first.html#comment-10902 etc Wed, 09 Jul 2008 15:37:00 +0000 http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-a-lousy-first-half-too/#comment-10902 "There's only one strategy: Two and Twenty."<br/><br/>Or 5 and 40, if you can get it. And do techniques to generate non-economic P&L in order to purportedly earn the 40. “There’s only one strategy: Two and Twenty.”

Or 5 and 40, if you can get it. And do techniques to generate non-economic P&L in order to purportedly earn the 40.

]]> By: daveNYC http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-lousy-first.html#comment-10901 daveNYC Wed, 09 Jul 2008 15:06:00 +0000 http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-a-lousy-first-half-too/#comment-10901 <i>"Hedge fund" stories in the press drive me nuts because they're lumping an enormous variety of strategies.</i><br/><br/>There's only one strategy: Two and Twenty. “Hedge fund” stories in the press drive me nuts because they’re lumping an enormous variety of strategies.

There’s only one strategy: Two and Twenty.

]]> By: Stuart http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-lousy-first.html#comment-10891 Stuart Wed, 09 Jul 2008 12:56:00 +0000 http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-a-lousy-first-half-too/#comment-10891 I wonder how Jimmy Rogers is doing.. lol <br/>The media loves their icons, or their need to create myths of icons. that's for certain. I wonder how Jimmy Rogers is doing.. lol
The media loves their icons, or their need to create myths of icons. that’s for certain.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-lousy-first.html#comment-10883 Anonymous Wed, 09 Jul 2008 12:02:00 +0000 http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-a-lousy-first-half-too/#comment-10883 "Hedge fund" stories in the press drive me nuts because they're lumping an enormous variety of strategies. “Hedge fund” stories in the press drive me nuts because they’re lumping an enormous variety of strategies.

]]> By: Scott http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-lousy-first.html#comment-10882 Scott Wed, 09 Jul 2008 11:54:00 +0000 http://www.nakedcapitalism.com/2008/07/cheer-up-hedge-funds-had-a-lousy-first-half-too/#comment-10882 "...hedge funds on average lost money the first half. And that was before fees."<br/><br/>Yves,<br/><br/>FYI, to the best of my knowledge, all the HFRI published returns are net of, i.e. after, fees.<br/><br/>Regards. “…hedge funds on average lost money the first half. And that was before fees.”

Yves,

FYI, to the best of my knowledge, all the HFRI published returns are net of, i.e. after, fees.

Regards.

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