Starting a small Hedge Fund??

i wish it was 125mil..

the performance is just cumulative.. so those performance stats could be misleading to someone who is clueless.

with options you can't invest your whole account so we recommend 2-5% only... and with a 60% winning percentage you have a decent chance of outperforming the S&P.

overall, this just shows i have a good grasp of finding good plays at the right time :)

i have to leave managing risk/exposure to individuals. i can only give recommendations... so people don't blow up their accounts in search of making a million out of 10k in 1 year.
 
Quote from BudFoxx:

i wish it was 125mil..

the performance is just cumulative.. so those performance stats could be misleading to someone who is clueless.

with options you can't invest your whole account so we recommend 2-5% only... and with a 60% winning percentage you have a decent chance of outperforming the S&P.

overall, this just shows i have a good grasp of finding good plays at the right time :)

i have to leave managing risk/exposure to individuals. i can only give recommendations... so people don't blow up their accounts in search of making a million out of 10k in 1 year.
More...

Ok.
Im clueless.
Explain to me how 1400% does not mean 14-fold gross return on investment for 2007.
 
Quote from SnookFishing:

I would like to start a small hedge fund in Florida with about $5 million dollars. The investors will be friends and family, so i mostly want to keep the start up cost down as much as possible.

If there is anybody out there that could provide any help, that would greatly appreciated.
More...

Read my book before you open your fund so you know what you're getting into--it may surprise you
 
All these sites are ripoffs. They have the same look and different urls. Even if the results aren't hypo they are exaggerated to the best possible buy and sell price. Lets say the option ticked up for one trade 25% that would be their posted sell.

Still the only way I have found to make money in the market is to teach yourself not pay someone for advice. Why do they need to collect money if they are so good anyway?

Also if you dabble in options 95% of option buyers don't make money. Besides covered calls the only options I would sell are puts with an intention to buy the stock.

Goldman for ex would have been a great stock to sell a naked put on the the month when the vix (volatility) jumped. You could have pocked $700 or so per hundred and picked up GS for 170-180 (rough numbers). That's the kind of opportunities to look for in options.
 
Quote from anvil993:

Snook, Green isn't the way to go.

$5mm gives you a critical mass to do it right. Even if you plan on staying small, you should shoot for 'best practices' from the get go. If you do well and begin receiving institutional interest the fact that you used hallmark firms will serve you well in the due diligence process.

Fund organizational fees can be amortized over three years which reduces the impact on the expense ratio.

Hire a solid top tier hallmark law firm, spend your money on a small retainer, these firms will draft an agreement whereby they will await the balance due when the fund launches and raises capital.

You can decide to have the partnership itself bear the fees, you can decide to give the investors a break and bear the expenses on the management company level, or split them.

Once the fund is up an running the legal fees tend to decline and the tax and audit fees become a larger item.

The fund 's returns along with money in/money out are audited; the management company simply needs a CPA for return filings and K1s to limiteds.

Form a limited liability company as the manager, sponsor, general partner.

The management company then forms, organizes the partnership.

Legal=Formation, organization, secretary of state filings for an LLC and a LP.

The top tier firms get all this done between 10-15k.

An audit runs around 7K and isn't necessary until the fund is running for 10 months or so.

There are a half dozen firms that own the space. The money spent is well worth it, if you do well, your law firm will introduce you to fund of fund it represents. Dont underweight the networking benefits of having Sadis & Goldberg, Sullivan Cromwell, or a Paul Hastings.
More...

Sulllivan Cromwell will cost you more than that, I am afraid. If not, please pass on the name of the associate there who will.

That said, to do it "right," the OP should count on spending $30k to $50K start up, which is 0.5% of seed capital -- and thus very reasonable, in my book. Good luck. And where in Florida are you?
 
I used Turn Key Hedge Funds and they were very reasonable--cost me $12k or so to get up and running. Lots of crappy firms out there, this isn't one of them
 
Quote from SnookFishing:

I would like to start a small hedge fund in Florida with about $5 million dollars. The investors will be friends and family, so i mostly want to keep the start up cost down as much as possible.

If there is anybody out there that could provide any help, that would greatly appreciated.
More...

In addition to all the other advice, you could also consider an IB Friends & Family setup. That's super clean and simple.

Allan
 
2nd attempt asking this:

what's your background?

Which firms if any did you work for relating to finance?

What qualifies you to offer advice?

Did you back-test your technical signals? If so using what data and what platform?
 
You must log in or register to reply here.
Back
Top