P2,
Call Gerald A. Barbara of Grant Thornton
212-422-1000
He'll be able to answer all your questions .
Call Gerald A. Barbara of Grant Thornton
212-422-1000
He'll be able to answer all your questions .
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Funding a hedge fund...
- Thread starter praetorian2
- Start date
voltrader:
I don't consider these stocks to be part of my trading. They are in a seperate account that I've never considered to be part of my trading and when they go up substantially, I don't think I will include them either. Furthermore, when investing, your entry is often irrelevent. It's your exits that really matter. To that end, I keep adding to these 2 positions b/c the fundamentals are still solid. Lower prices equate to better value. I'm sure people who know me can advise you to the 2 positions, but I don't want to appear that I'm pushing 2 penny stocks. If I could find a better investment for my spare capital, I certainly would put it there. I just think that these 2 stocks, and one of them in particular is just at an extreme discount to any market rationalle. It's just that it's unknown of, and hence undervalued still. The 2 option positions I do consider as part of my p/l. I just don't think it's good to mark positions to market to determine performance. It's much better to wait til I'm pretty close to flat and make those determinations.
I don't consider these stocks to be part of my trading. They are in a seperate account that I've never considered to be part of my trading and when they go up substantially, I don't think I will include them either. Furthermore, when investing, your entry is often irrelevent. It's your exits that really matter. To that end, I keep adding to these 2 positions b/c the fundamentals are still solid. Lower prices equate to better value. I'm sure people who know me can advise you to the 2 positions, but I don't want to appear that I'm pushing 2 penny stocks. If I could find a better investment for my spare capital, I certainly would put it there. I just think that these 2 stocks, and one of them in particular is just at an extreme discount to any market rationalle. It's just that it's unknown of, and hence undervalued still. The 2 option positions I do consider as part of my p/l. I just don't think it's good to mark positions to market to determine performance. It's much better to wait til I'm pretty close to flat and make those determinations.
CA Grange, What exactly am I calling Gerald Barbara about?
Thankyou for the lead though. I just wanted to know what I should ask about.
Thankyou for the lead though. I just wanted to know what I should ask about.
I think I can help, here is some background first:
I am just about to get started trading at Bright (took series 7 on Tuesday of this week, tough to study while world cup matches on). I used to trade at an "un-named" NYC firm. However, in my previous career I was an M.D. of a Wall Street firm in the fixed income area.
I was alerted to the trading business by a close friend who I had worked with years earlier who started trading around 1996. He has subsequently become very successful. He now operates an "affiliate" office of one of the major prop trading firms. In that office he has many individual traders, but also a hedge fund comprised of 2 individuals. This hedge fund simply reduces their overhead by using the office space and and trading environment that has been set up. I traded down there for a while, and when I started, the hedge fund had $5 million of equity. Last time I checked, they were at > $50 million. Word of mouth is what got them the additional capital.
Getting to $10 million starting equity would not be difficult IF you can really document your performance for say 2-3 years including details on max draw-downs, etc.. As others, especailly Gene Epstein, pointed out - unless you are anticipating getting to a large size, you are better off trading your own capital at 100% profit retention vs say 20% (typical hedgie incentive %).
Interestingly, my friend who started this office, eschewed the hedge fund route, he's not capital constrained so why take in outside money to trade at 20% of the profits vs 100% on his own money? Also, and perhaps most importantly, you need to be convinced that you can produce positive alpha with tens of millions of dollars as opposed to a few hundred thousand. Many strategies do not work when trading big $ ; a case in point is "stepping in front of size", whereby the entire strategy is to take advantage of your small size and nimbleness versus the institutional 800 pound gorrilas..,
I am just about to get started trading at Bright (took series 7 on Tuesday of this week, tough to study while world cup matches on). I used to trade at an "un-named" NYC firm. However, in my previous career I was an M.D. of a Wall Street firm in the fixed income area.
I was alerted to the trading business by a close friend who I had worked with years earlier who started trading around 1996. He has subsequently become very successful. He now operates an "affiliate" office of one of the major prop trading firms. In that office he has many individual traders, but also a hedge fund comprised of 2 individuals. This hedge fund simply reduces their overhead by using the office space and and trading environment that has been set up. I traded down there for a while, and when I started, the hedge fund had $5 million of equity. Last time I checked, they were at > $50 million. Word of mouth is what got them the additional capital.
Getting to $10 million starting equity would not be difficult IF you can really document your performance for say 2-3 years including details on max draw-downs, etc.. As others, especailly Gene Epstein, pointed out - unless you are anticipating getting to a large size, you are better off trading your own capital at 100% profit retention vs say 20% (typical hedgie incentive %).
Interestingly, my friend who started this office, eschewed the hedge fund route, he's not capital constrained so why take in outside money to trade at 20% of the profits vs 100% on his own money? Also, and perhaps most importantly, you need to be convinced that you can produce positive alpha with tens of millions of dollars as opposed to a few hundred thousand. Many strategies do not work when trading big $ ; a case in point is "stepping in front of size", whereby the entire strategy is to take advantage of your small size and nimbleness versus the institutional 800 pound gorrilas..,
Originally posted by Invoco
p2,
Be careful how you go about soliciting funds for your hedge fund. Any form of general solicitation or advertising--which would include posts in any of these forums-- violates SEC and state blue-sky laws.
I received the following email the other day.
Would this be regarded as solicitation?
"Daniel,
MAR RANKINGS l ADVISORS
FOR ADVISORS MANAGING
AT LEAST ONE MILLION DOLLARS
TOP TEN TRADING ADVISORS RANKED BY RETURN
ENDING APRIL 30, 2002
LAST 12 MONTHS
Gain (%)
1 Ansbacher Investment Mangement 58.22
2 Spirit Trading 35.11
3 Blenheim Capital Management 32.98
4 Daniel R. Meyer 31.54
5 Cornerstone Trading (Intl Value) 30.92
6 Tucson Asset Management (Global) 30.65
7 Hawksbill Capital (Global Diversified) 27.78
8 City Fund Management 26.42
9 Martin Petherick (Futures & Options) 24.17
10 Tucson Asset Management (Domestic 2X) 22.85
Past performance is not necessarily indicative of future results. The risk of
loss exists in writing and buying options. An investor could lose all or a
portion of the amount invested.
THIS MATERIAL MENTIONS SERVICES WHICH RANK THE PERFORMANCE OF COMMODITY TRADING
ADVISORS. PLEASE NOTE THAT THE RANKINGS ONLY APPLY TO THOSE CTAS WHO SUBMIT
THEIR TRADING RESULTS. THE RANKINGS IN NO WAY PURPORT TO BE REPRESENTATIVE OF
THE ENTIRE UNIVERSE OF COMMODITY TRADING ADVISORS. THE MATERIAL IN NO WAY
IMPLIES THAT THESE RESULTS ARE OFFICIALLY SANCTIONED RESULTS OF THE COMMODITY
INDUSTRY.
MAR May 2002 38
2002 CINV 557
When you have questions, Daniel, you
can reach us at +1 (503) 471-1300 or
(800) 548-2127.
Yours truly,
Brian Lee
Commodity Futures Options Trading, Inc.
One World Trade Center
121 SW Salmon, #1100
Portland, Oregon 97204 USA
(800)548-2127 +1(503)471-1300"