Nice job Aaron! Maverick is correct that raising funds is unbelievably tough without connections. There are a number of funds up as much as Aaron - some up much more - who are having a very hard time raising any funds. It seems many people have the same question: "If your returns are so good why don't you have more $$$ ?" They don't invest because others aren't investing and around it goes. The lemming effect in the market that hurts so many of these funds may serve to create the very inefficiencies that make us money in the first place. Whether the crowd is chasing a hot Cramer tout or a hedge fund, it's often dumb money just following the crowd. Then there's the ex Goldman guy who makes a few calls and starts with 1B. As far as fund guys staying anonymous here on ET. I think it's best for most to do so. When Aaron was in the midst of his drawdown, some people decided to kick him pretty hard rather than support him. The markets are a kiddie pool full of sharks and this place isn't much different at times. A bad drawdown can be like a death in the family only it's your fault. It's bad enough when your clients have to see you bleed, but to come here and get beat up again just isn't worth it.
Amen on the raising of funds issue. I am up to $435.76 so far ($0.76 from the cheapest uncle in the world!).
Yes, congratulations Aaron on a great year! I really admire your mental fortitude and perseverance. I have been following your fund since inception and remember quite well when it hit quite a bit of turbulence couple of years ago. You were subjected to much ridicule here on ET. Great job sticking with your system. Excellent work on reducing your volatility, best of luck.
i want to get in on this lovefest......great job Aaron!!!! you know what's scary.....maverick and ktm are right.....some say "a good record sells itself"......and "there's no shortage of money for good traders".......and "there's more money out there than good traders to manage"..........thats all false jingoism because you have here a genuis type of cat (MIT grad., once enrolled in phyics PHD program) and the apprentice of a Market Wizard with a great track record and instead of 30+ million he's managing 3.............yet at the same time the really big money don't mind losing 10+ billion on ltcm, amaranth, motherock and others......follow the 'leader'.......herd mentality, like sheep led to slaughter. hope you continue to kick ass Aaron.
Actually, I think the reason that it's hard to attract money is a bit more complicated than not having connections. I looked at the performance and the first thing that caught my eye was the almost 50% drawdown. The second thing that caught my eye is the corresponding "worst month" performance of 24%. Those are numbers I can barely tolerate in my own trading let alone from a 3rd party manager. I think any money manager would want to see a few years of trading where that statistic isn't repeated. The fact that the program went on to make new highs is very impressive. I bet that a number of folks are watching and waiting. Non correlation to the broad markets is a good thing but no institutional or high net worth money manager wants that diversification at the expense of high drawdowns... Having said all that, way to go Aaron! Staying the course in the midst of all that is very impressive. -eLindy
Thanks, eLindy! Keep in mind that we've cut our leverage by half since the volatile days of 2004. While we're unlikely to have any more 25% down months, we're also unlikely to have any more 32% up months. Our worst down month since cutting the leverage was -9% in July, 2005. The best month was +16% this past February. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. FUTURES TRADING IS SPECULATIVE AND INVOLVES A HIGH DEGREE OF RISK.