if you start your own fund how do you deal with?

[chipmunk]

Those months or even the odd year of flat or negative returns? It's great when you are amknig money but what about the cycles where you are not?

I am guessing you need to keep plenty of $$'s in reserve to pay your way during these peiods..or have some credit?

 

[crgarcia]

Quote from chipmunk:

Those months or even the odd year of flat or negative returns? It's great when you are amknig money but what about the cycles where you are not?

I am guessing you need to keep plenty of $$'s in reserve to pay your way during these peiods..or have some credit?

This is why hedge funds charge account managing fees (usually 2%)in advance, to pay expenses (office rent, secretary, utility bills, etc.).

The goal is to be able to survive during adverse conditions, without going broke.
Insana only lost 5% to their customers (so he didn't collect any performance fee), but his management fees (about 1 or 2 million, wasn't enough to mantain his luxury offices salesman and analysts).