Anyone here "NOT" manage a HEDGE fund?

[segv]

Quote from 99atlantic:

I'd never risk more than a few thousand of my own personal money trading (just don't tell any of my clients that....they might be pissed that I'm willing to take market risks with their money but not my own) ^_^

You run a 100M fund with no substantial portion of your own net worth invested in it? Shenanigans.

As to the other posters who wrote off odd hedge fund splits like 5/50, anything other than 2/20 is nonsense that would get you laughed out of the room.

-segv

 

[TruthSeeker247]

Quote from 99atlantic:

I manage a $100M hedge fund...go me ^_^ (i really do btw)

Sounds like you think that you can just start one up and investors will throw money at you? Like seriously, is it that hard to google 'hedge fund definition' and read from there?

What's the name of your fund?

 

[MorganSys]

Barclays data
2005:
Fees: 1.58/19.6
AUM: 1.2T

More data:
http://www.barclaygrp.com/indices/ghs/mum/HF_Money_Under_Management.html

 

[TheStudent]

Quote from segv:

As to the other posters who wrote off odd hedge fund splits like 5/50, anything other than 2/20 is nonsense that would get you laughed out of the room.

-segv

From THE WALL STREET JOURNAL
July 1, 2005; Page C1

"Mr. Simons, whose net worth has been estimated at $2.5 billion, has seen Renaissance's $5 billion flagship Medallion hedge fund earn an average of 34% annually since it began in 1988, making it the most successful fund during the period. These returns, which are audited, come even after fees that now are -- get this -- 5% of assets and 44% of all investment gains."

I don't even want to get into the fee structure of Quadriga that has to return 9+% before you see a dime. It's in the prospectus by the way.

 

[TheStudent]

The New York Times
Published: May 26, 2006
By JENNY ANDERSON

According to Alpha's list, Mr. Simons charges a 5 percent management fee and takes 44 percent of gains; Steven A. Cohen, of SAC Capital Advisors, charges a management fee of 1 to 3 percent and 44 percent of gains; and Paul Tudor Jones II, whose Tudor Investment Corporation has never had a down year since its founding in 1980, charges 4 percent of assets under management and a 23 percent fee.

They may charge such amounts because they can. "In the end, what people want is the risk-adjusted performance," said Gordon C. Haave, director of the investing and consulting group at Asset Services Company, a $4 billion institutional advisory business. "As long as the performance is up there, in the end the investors do not care about the high fees."

 

[Trader5287]

The coming hedge fund bust is going to be huge for lawyers.

Clients have way more money than the funds the way I see it. Plus SEC losing jurisdiction to reign the cockroaches in, referral fee revelations, lifestyle articles everywhere about top managers.

Looks like a good setup for a trade -- by the trial bar.

 

[marketsurfer]

Quote from Trader5287:

The coming hedge fund bust is going to be huge for lawyers.

Clients have way more money than the funds the way I see it. Plus SEC losing jurisdiction to reign the cockroaches in, referral fee revelations, lifestyle articles everywhere about top managers.

Looks like a good setup for a trade -- by the trial bar.

LOL ! however, i don't agree. the accredited, knowledgeable investor clause in ALL true hedge fund documents pretty much eliminates any litigation except in cases of proven fraud.

if one loses his money in a hedge fund, he is out of luck--unless proveable fraud is involved.

surf

 

[marketsurfer]

thanks for clearing that up student. 44% is outrageous--- i have heard 50% in some vehicles.

only one getting rich is the manager.


surf

 

[chewbacca]

Quote from TheStudent:

The New York Times
Published: May 26, 2006
By JENNY ANDERSON

According to Alpha's list, Mr. Simons charges a 5 percent management fee and takes 44 percent of gains; Steven A. Cohen, of SAC Capital Advisors, charges a management fee of 1 to 3 percent and 44 percent of gains; and Paul Tudor Jones II, whose Tudor Investment Corporation has never had a down year since its founding in 1980, charges 4 percent of assets under management and a 23 percent fee.

They may charge such amounts because they can. "In the end, what people want is the risk-adjusted performance," said Gordon C. Haave, director of the investing and consulting group at Asset Services Company, a $4 billion institutional advisory business. "As long as the performance is up there, in the end the investors do not care about the high fees."

So for this Simons guy to AVERAGE a NET 34% for his investors that means he is making over 75% on the money he runs.
75% on average on BILLIONs is amazing....GREATEST TRADER OF ALL TIME???

 

[chewbacca]

On second thought, no one seems to account for leverage on fund performance. Lets say a buy and hold mutual fund returns 8% a year without using leverage and trading strictly stocks from the long side. Now a hedge fund using 5-1 leverage and trading multiple markets and derivative contracts returns 40% a year.
Which is the better fund?
The mutual fund obviously.