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The Transformation Of Hedge Funds Into Mutual Funds
Whether 'size matters' or not to the average hedge fund matters is a question many ask; but as Goldman's Hugo Scott-Gall summarizes perfectly in this chart, it is clear that the preference for herding into the biggest of big caps is becoming ever more crowded. Certainly this likely accounts for the massive rise in correlations (and the over-crowded momentum factor style skew in the market) but the dilemma is foraging for alpha in these huge mega-cap over-researched names is an ever-decreasing game of a-fraction-of-a-basis-point-of-alpha against a sea of beta - and for that mutual-fund-like return, you pay your 2-and-20.
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2 & 20 to pay you to hold my money for a negative return... Got a mattress?
Exactly... these fools pay 2/20 so that they can lag a Vanguard mutual fund. All so that they are "hedged" during a downturn. Unfortunagely, "hedged" today means that you lose multiples of what Vanguard loses during a downturn.
Vanguard, lol
Fortress, lol
If someone is going to have Ukranian hookers snorting lines of coke off my dick (using my money as payment), I'd rather it be me...
I wish there was a UHSCOMD Index.
And some of the mutual funds are becoming more like hedge funds.
LOL everyone wants to be someone else
Bankers want to be traders, traders want to be bookies, waitresses want to be actors, actors want to be rockers, regulators want to be WWE referees and the fed wants to be God.
edit
I wonder how a 2/20 fund that just bought gold and sat on it would have performed ...
worse than if you just bought gold.
I ignore the premium I pay or silver because I am the one making the decisions on when to buy it. I could not ignore the commisions to someone who is making decisions for me and is losing while doing it.
And here I thought that the massive correlation was due to everyone going to the same algo supplier.
Monkeys throwing darts at a board
beat these hedge funds time and time again.
You'd be far better with the monkeys because
1) they don't charge 2/20
2) they don't trade against you
3) they don't "lose" segregated customer funds.
#3 is most important
#4 they don't reassign blind funds based on the political sway of the customer.
2 and 20 plus 5.75%
Buy Physical Gold Buy Flawless Diamonds, Don't Trade Fraud Markets, Live Well. !!!
Yeah I do it all the time through RapNet. It is beyond easy. It is sourcing the diamonds that is the real challenge especially at a price point where your margins don't go to $hit. Most in the diamond business make really piss poor margins but they make up for it in sheer volume.
Crossing the Venezuela/Brazilian border is always fascinating especially since my Portuguese is crap. The only place I am not willing to go is West Africa or the Congo to source them.
It is a much more exciting vacation from my job & lucrative money matter with 2 partners.
Exactly!
Unless you're an expert, you will most likely get screwed if/when you try to sell diamonds.
Fungibility roolz. Stick with gold and silver.
I like 1590.00/27.50. Sleep tight and no friggin assholes came use your money against you. If you can't fondle it, its just another fraud.
Sudzee:
Thank you for comng out of the Gold Bug closet!!! I have been telling people here that a lot of Gold Bugs were fondlers, and many did not seem to believe me.
Squeeky Fromm, Girl Reporter
Been a fondler since 87. Been thru the bashing PM crap many times. I just keep stacken with spare cash.
The Transformation Of Hedge Funds Into Mutual Funds
Is this where they pull out the "Mission Accomplished" banner? Hedge funds were those evil speculators and people that would short the market. Problem is, now who will they blame?
Oh yeah, the lack of regulation!
These guys know that this shit is to good to be true. They also know that one morning we are going to wake up to a crashing market stampede and they want to be in the most liquid names. IMO it isn't going to work.
Let's keep in mind we have new SEC rules for stock by stock circuit breakers, which I don't think have been tested in a true market rout. It's a new world order. Programmed control, HFT's, market correlation and ETFs. I don't think anybody has a clue what's really going on except people are scared, distrustful and getting the hell out. Rightfully so.
Hey, how's that volume today?
dear tyler(s)
let me know when dalio can't make numbers...last time I looked he was near the top in size and continues to deliver alpha...it does beg the question, how?? I agree with those who wonder how the 2/20% is sustainable
In isolation, this chart tells you very little. Almost nothing. You have no idea of the overall size of money invested in hedge funds, number of hedge funds, etc. There are several reasons why this could occuring.
Frankly hedge funds are the modern-day shylocks of our economy. At best, they give you a nice outsized, risk-adjusted return for a period of a few years and you get out before the fund get too big/management changes/economic themes or trends they bet on go bust or change. At worst, they give you a terrible return, your money is stuck, and as recent examples show they do all kinds of unethical and even illegal things. Either way, they still get paid. Kind of like private equity. If they win, they get paid spectuarly. If they lose, they just get paid.
Never understood either why the people who go crazy and shoot up everyone aroudn them don't go to a place where instead of finding average slubs just trying to make it through the day they don't to Greenwich or New Canaan instead.
Uh-oh. Even the sick, greedy bastards running Hedge Funds are skeeered. This is a game of Pac Man; we have ghosts up our ass and we're running towards more. And The Bernank is simply minting more quarters. Game Over is nearby.
Real Power from Fake Money?
http://shutupnsing.wordpress.com/2012/07/14/the-centralization-of-real-power-using-fake-wealth-self-interest/