Hedge Funds

  • 02 Jun
    Should You Follow What Hedge Fund Managers Are Doing?

    Should You Follow What Hedge Fund Managers Are Doing?

    • I’ll describe in detail how you can follow hedge fund managers.
    • It’s very important to understand the risk reward profile of the fund manager.
    • Following allows us to find great investment ideas, but there are also big traps.

    Introduction

    Every fund has to disclose its portfolio to the SEC quarterly in a 13F form which allows us to track hedge fund managers’ portfolios. It’s easy to track what George Soros, David Tepper, Seth Klarman, Dan Loeb, Carl Icahn, David Einhorn, Bill Ackman, Warren Buffett, and many, many other interesting investment stars have been doing. The data is usually disclosed 45 days after the end of the quarter, but nevertheless shows what these guys have been doing.

    When you see the research power all those funds use, you might think it’s an excellent free lunch. Well, it could be, but there are a few things to be careful of. More →

  • 15 Feb
    The Institutional Performance Derby: The Client Is the Loser

    The Institutional Performance Derby: The Client Is the Loser

    • It’s important to understand how investing institutions operate and think so you don’t get trapped.
    • Nobody at these institutions eats their own cooking and there is no incentive to do anything. It reminds me of communism.
    • Institutional investing is a self-reinforcing mechanism, which is great in a bull market but terrible in a bear market.

    Introduction

    Seth Klarman’s book Margin of Safety is an iconic investment book. As it’s extremely difficult to get, I’m synthesizing it for you while injecting my own up-to-date commentary.

    You can read my introduction to Klarman’s Margin of Safety here, my review of chapter one, Where Most Investors Stumble, here, and my review of chapter two, The Nature of Wall Street Works Against Investors, here. Today’s article will discuss his The Institutional Performance Derby: The Client Is the Loser chapter. More →

  • 11 May
    Hedge Funds as Investment Diversification

    Hedge Funds as Investment Diversification

    • Hedge funds have performed miserably in the last bull market but things might turn.
    • Fees are the deal killer as 2% of assets under management and 20% of profits eats up all the returns.

    Introduction

    There is currently a negative sentiment towards hedge funds as they mostly underperformed the market in the last 6 years. This article is going to elaborate on how hedge funds work and relate that to the current circumstances in order to assess investment possibilities. More →

    By Sven Carlin Hedge Funds Investiv Daily