Grantham Says Hedge Funds, LBO Funds to Collapse
- Thread starter THE-BEAKER
- Start date
I have to agree to a certain point.
There's way to many hedge fund that is starting up without the necessary skills to survive. The hedge fund industry is way different from the mid-1980s or the late 1990s. It's a lot more easier to startup a hedge fund now than ever along with how easier it is to collect OPM.
A red light turns on when I talk to a new fund managers trading Forex, BRICs, and equities. 70% of these new managers have been trading for less than 3 years... (I'm already hearing few of the smaller funds closing their accounts, with this setback in US equities)
The foremost... they don't have tolerance towards risk. They've never experienced a significant drawdown period and never survived a tough trading period in their life.
Bit of a cliche... but 90% of the traders lose(quit) in the long run.
There's way to many hedge fund that is starting up without the necessary skills to survive. The hedge fund industry is way different from the mid-1980s or the late 1990s. It's a lot more easier to startup a hedge fund now than ever along with how easier it is to collect OPM.
A red light turns on when I talk to a new fund managers trading Forex, BRICs, and equities. 70% of these new managers have been trading for less than 3 years... (I'm already hearing few of the smaller funds closing their accounts, with this setback in US equities)
The foremost... they don't have tolerance towards risk. They've never experienced a significant drawdown period and never survived a tough trading period in their life.
Bit of a cliche... but 90% of the traders lose(quit) in the long run.
if anyone had actually paid any interest and put some positions on in light of what i have been saying the last few weeks and months on elite trader about this mess you would not be calling me a doom monger but a profit monger.
just because this bad news has not made people money is not my problem.
ive done ok out if it.
i think there is more out there.
i think you under estimate the size of the inventory the banks and funds are holfing in relation to this.
not to mention if fannie mae or freddie mac should come to the news stands with some bad news.
this is not doom mongering but a reporting of a mess thats only just started.
sounds to me like you missed the boat on this one.
Wonder what happens when "concerned investors", who have way more money than the HF asshats, take those concerns to the nations' 200,000+ trial lawyers. Think these guys care what the client agreements say? 
Quote from Trader5287:
Wonder what happens when "concerned investors", who have way more money than the HF asshats, take those concerns to the nations' 200,000+ trial lawyers. Think these guys care what the client agreements say?
Regarding the current legal system... there's not much the "concerned investors" can do. Most hedge funds are regulated under an offshore jurisdiction. But... what can be done is cracking down on the marketers and incubators who live in the US, collecting cash for these funds by investigation.
A hedge fund manager who sucks at trading is not a crime.
What can happen is... the SEC can build strict regulations for operations in the US. Operations meaning regulating the marketing and $$$ handling. It'll prolly be much like Series 3/CTA regulations.
Quote from makloda:
"may force as many as half of all hedge funds to close in the next five years." Funny how 1998 couldn't do that but 2007 will
didn't have a liquidity bubble in 98. 98 helped lead us to where we are now. thanks greenspan...