Not everybody wants to be hedge fund manager. Very successful traders that cannot trade huge positions trade for themselves only. Because they cannot profit from the size of a hedge fund as their system does not allow this, and second they take not 2 and 20% but 100%. If you watch how many funds can stay out of the red returns over a period of 10 years or more, it looks like these managers are not the toptraders but the subtop. Or they are real crooks like Madoff.
Oil Fund loses 7 years of gains
- Thread starter Pekelo
- Start date
I agree, it doesn't take a genius to realize this -- I never have understood why individuals would hand over their money to a hedge fund manager. they take 2% regardless and 20% of profits....and the majority or average of them...have rather shitty returns.
Trading/managing your money isn't that difficult. People treat hedge fund managers like they're geniuses. a knight in shining armor riding on a white horse...who will bring them heavenly returns...
A hedge fund is basically a mutual fund, but playing or getting creative with the addition of options. instead of just going long on stock/buying and holding.
Well said, but in fact, it is true. I agree with you. For a reason, some successful people advised not to trust money to someone else. You know better than anyone.
Amazing the benefit a simple ole stop loss would have provided
or conversely...
The devastation it would have prevented
Appears some of theses big bad ole HFs..., aren't any better than a neophyte
My former "professional mm" wasn't any better
Go figure
RN
That would be fine if investors were willing to agree to a gate structure in terms of withdrawals. On a managed account basis, where clients can withdraw funds at any time, you would need that 1% just to cover the overhead. There are some fairly stiff legal and accounting expenses that are ongoing and will not be as variable as the client count in a managed account business model.
This is the lesson. Never invest in crude or crude stocks, eventually you will lose your shirt.
Good points. 1% is probably doable and it's naturally only for overhead, not for parties and bonuses.
The gate structure seems like an obvious thing to do. HFs need to become more like long-term investments rather than a place to park your money in for months or a few years. This would eliminate many of these quick buck chasers that seem to account for 70% of HF managers.
