Help in choosing hedgefunds in which to invest

L

LuckyGirl

I have been diligently studying and live trading with a small amount of money for a few months now but seem to have a knack for being exquisitely wrong. If it weren’t so humiliating I would start a thread listing my current trades so you guys could fade me. I’m not going to give up yet but it’s obvious that I won’t be capable of managing our money anytime soon, and our long only investments with Harris are dying a slow death (down $300k just in the last month).

I’ve contacted an “Alternative Investments” manager who blends together a portfolio of hedgefunds for his clients. My question to you guys is: What questions should I be asking him?

I’ve done a bit of searching around and have not yet found a thread that critiques hedgefunds but if such a thread exists, please point me to it.

Thank you in advance for your responses, and may I add that I love this site. Between the intelligent debates and the creative insults I learn something every day.

A “Moistie”.
:p
 
Sign up for as many free magazine subscriptions as possible with Institutional Investor. Attend as many of the cocktail party receptions and seminars as possible. You can meet your husband at such an event. Then you'll really be a "lucky girl" and not have to bother with all of this investment/trading B.S. :cool:
 
Thanks so much Makloda, ProfitTakgFool and Nazzdack for taking time out of your trading day to respond. I will follow up on your suggestions. Nazzdack, you’re going to have to hook me up with these investment cocktail parties though!
 
Look for a CTA.

There are two risks in investing:
A. Losses by wrong trading strategies.
B. Losses by people who run with your money.

You completely avoid B by having a managed account.
You minimize A since CTAs are required to keep strict track records.
 
Not to rain on your parade, but here's a big "heads up": If you are seeking to invest in a package of hedge funds --- to generate positive investment returns not correlated with the broad market (S&P, etc.), be very aware that you will be attempting to accomplish something that a large number of extremely knowledgeable and superbly-equipped professionals worldwide also seek, and have had very poor results for years now. These professionals are managers of "funds of hedge funds", and their net returns have been in the mid-to-low single digits for a long time now. Worse, some have suffered big losses for their investors in the past nine months, as some of their formerly "hot hedge funds" have blown up.

If you really want to pursue your stated investment strategy, you will have to do much, much more than read a book or two, or talk with an "alternative investments" packager. Otherwise, you are just shark bait.

There is a huge amount of free relevant info on the Internet, and even more if you advance to the point of wanting to purchase worthwhile data and research from various reputable sources.

Just recognize at this time that many very sophisticated investors have gotten creamed by their hedge fund investments in the past year. If you want even a chance of doing better, be prepared to do a lot of serious research --- and a lot of serious thinking. Good luck.
 
Lucky,

Sounds as if you are freaking out just because you are down. You have only been trading a few months it should be expected. If your real dream is to manage your own money. I would not give up in just a few months.

When I first started to trade, I took a few thousand dollars and my goal was to loose every penny. Make every mistake in the book so that I could learn.

Here's an idea. Take a portion of your portfolio and give it to a Hedge Fund manager. Take another portion and actively manage it yourself. I guaranteee you that you will come out ahead of the manager 70% of the time.

Good luck.
sophie

Quote from LuckyGirl:

I have been diligently studying and live trading with a small amount of money for a few months now but seem to have a knack for being exquisitely wrong. If it weren’t so humiliating I would start a thread listing my current trades so you guys could fade me. I’m not going to give up yet but it’s obvious that I won’t be capable of managing our money anytime soon, and our long only investments with Harris are dying a slow death (down $300k just in the last month).
More...
 
Contact HFR and if you are a "qualified investor" they will talk to you, if not don't bother...by far they have the greatest exposure to more funds than probably anyone in the world...good luck..
 
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