Raising Money for a Hedge Fund

Quote from elit:

I agree. You would need to be very good at sales, or hire some sales guru. You can have an average product and be the market leader if your good at sales and marketing. World is full of examples.

Or you would need an awesome track record. I believe a good product would sell it self. If you have a money machine it will sell it self. Don't you all agree?
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100% in agreeance.


I started a fund a couple months ago with the help of a broker dealer (overseas..the the same princial applies anywhere, i do it overseas to attract big money in the form of a tax shelter, taxation issues are vital VITAL to growth and are a mian issue when people have real money). My years of smiling and dialing as a broker several years ago have paid off.

I went to every broker dealer in town and pitched them. showed my results, my methodology, my risk control system..and how much potential much they could make. i also pitched my cost (which is highly weighed towards my bonus which i only get paid if i perform...low risk for them). Most of the empasis was placed on risk control in the fund...If the rules are follow...a monkey could basically do it. I never pitched myself as a genius...but quite the opposite..i pitched utter simplicity. I got several bites...and took the best offer.

PM me if you like...but sales is the secret to many things in life, from getting a job, starting a company or finding a wife...it is all sales. It takes practice like anything else, but it is worth it. I think the most valuable ability that one can learn in life, is the ability to sell. it will make or break you.

good luck my friend...it CAN be done.
 
Jesse (or others),
Did you set up an LP to establish a track record or were you able to use a personal trading account (auditable trades, single strategy)? What are the requirements to post on Autumngold or Barcleys? Could I post with a 5 year personal account if I had the record audited?

Thanks,
Ken
 
You can use your personal trades as long as they are clearly identified in your disclosure document as proprietary trading, and as long as the strategy is essentially identical to what you are doing in the CTA. What gets posted on sites like Autumngold are the returns in your DD, so it is really dependent on how you choose to portray them there (I used my personal trading history). NFA has pretty rigid but reasonable guidelines on how you present your own trades. There is no NFA (or Barclay's or Autumngold) requirement to have them outside-audited at all, just know that if you misrepresent them, whether intentionally or accidently, you are way up the creek legally. This is easier to do accidently than you might think, there are very specific ways that they want returns calculate & presented. For instance, as an exchange member, my fees are a few cents lower. I had to go back and recalculate every (many hundreds of them) trade I had done for several years adding something between 3 and 6 cents to each, to give a more realistic picture of what a client would have experienced. Also, it is likely if you are a new CTA that any significant money or large concern will want to audit all of your trading records themselves. And don't forget, you will undergo an onsite NFA audit, no matter how small you are, sometime during your first year. You will also have to state clearly that you have either no experience or very limited experience managing client funds, and the NFA has specific language they will want you to include about that. I would go to the NFA site and read their guide to preparing disclosure docs, it goes into some detail about how to present proprietary returns, and if you have any questions, call their compliance dept., they are really helpful when getting started.
Good luck!
Jessie
 
Quote from jessie:

I had been a (rather mediocre) floor trader, and had never worked for another CTA or CPO, so I have no idea how it has worked for most others, but I have talked to at least a few with similar experiences. I honestly do believe that if you are persistent, ethical, and a good trader, the rest will get accomplished if you really want it.
Good trading!
Jessie
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From your experience, do you think managing other people's money is the way to go? Or is it not worth the headache?

Where can I read more about your returns, or if I wanted to invest with you?
 
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