Can someone call themselves a hedge fund manager if they made no money in 2 years?

Discussion in 'Economics' started by Ghost of Cutten, Jun 9, 2010.

  1. Seems like lots of large hedge funds have underperformed 2 year Treasuries over the last 2 years, with massively more risk. Shouldn't these funds just close down, and the managers retire from the industry? 2 years is an eternity in the hedge fund world - one year of underperformance can be accepted but surely underperforming *cash* for 2 years, with 20-50% drawdowns in between, is a sign you probably don't have any superior trading/investing talent and your prior record was entirely down to beta in a bull market.
  2. markcfd


    Maybe they should trade retirement accounts. People would be happy with 0% for the last few years compared to the returns they have had. :p
  3. Hehe, very true.

    One thing I find puzzling with Americans is how much faith they have in stocks. In no other 1st world country do I hear of regular joes who have 50-100% of their savings in the stock market. Yet in America some hairdresser or taxi driver with 30k saved up will have it ALL in stocks - and often in growth funds or some crazy shit too. Then you ask about valuations and you just get blank looks.

    The financial industry in the US must have one hell of a marketing machine.
  4. Nice observation. I noted the same after moving here from New Zealand. Most folks invested in laddered CDs (term deposits) and played the stock market with a smaller at risk amount.
  5. markcfd


    Well i'm not sure what the figures are like here in Australia but i know a high % of people have some stocks (probably mostly beacause of superannuation (401k).
    On another note, over here if we want to manage our own superannuation you have to pay $1500+ (likely a lot more) per year to some fools to audit what you are doing. I am led to believe it is a lot easier than that in the US is it not?

    Trendy how long ago did you move to the US? Me and the wife and kids want to move over too but we can only get over there on a 3rd preference family sponsorship :(
    Might get over there quicker by dropping half a million into a business :eek:
  6. markcfd. here in the US you buy a software program(under $200) to handle your accounting for your anualment portfolio or spend under $100 a yr to have an accountant do your taxes for your anualment portfolio at end of the year.

    $1500 for auditing your portfolio where you live?....thats crazy
  7. markcfd


    Are you talking about your retirement portfolio?
    Below is copied straight from the email from one of the places i contacted about running my retirement account when i asked about using a different broker than Comsec (commonwealth banks brokerage that charges $35 per trade or .1% of trade value whichever is higher)

    Hi Mark,
    You can use any other broker but it would not fit our pricing model. Our standard fee is $150 per month per member.

    So if i was to use someone else who knows how much their fee would increase

    To OP sorry i've just realized if taken this way off the original subject
  8. Most people on Elitetrader havent made money in over 2 years, yet they still call themselves traders. Any difference?
  9. kxvid


    Sure they can. Running a hedge fund isn't about making big returns for your clients. Its about taking home big checks for yourself regardless how your fund preforms.