Gene, I wouldn't do it unless I could get at least 5-10m. Hopefully 10-15m. I am positive that my performance wouldn't suffer too much. It would probably regress to annual gains of somewhere around 50-100% from the current gains of 200%+. I don't think more capital would be an issue. I really don't want to give away too much of an interest in my fund if I do it. But I don't know where else to get the capital.
praetorian2, Then I suggest you do your fund if you have the confidence, experience and capital. My reply was to the other 99.8% of the readers of this post. If you want to clear your fund(prime brokerage), I would be glad to help. I don't like to be "negative" in my posts, just cover all sides of the issue. Gene Weissman Lieber & Weissman Sec., L.L.C. gweissman@stocktrade.net
Thankyou for your posts. I am confident, but at the same time I really have no idea what I'm getting myself into. I definately would appreciate any insight from anyone who is an expert on the subject. If I can get the funding set up, I may take you up on your offer. My main concern right now is finding out if it is economical for me to go to the next step.
quite honestly, i wouldn't give any interest away, you'll always regret it, nor would i provide any financial incentives in the form of huge fees based on performance for clients to private client services or funding groups etc at investment banks, they'll really charge you to the hilt, doing a commissions deal with Ibanks for introductions to high net worth individuals might be feasible, on the other hand, and is often done. either that, or what i'd do is start by putting your own money in the fund and aggressively compound that for a number of years to have a black and white performance based on larger numbers, most pros won't look at you anyway until you have at least 5 audited years available with relevant equity size, and then go to hedge fund conferences, Ibanks, etc. cheers and good luck
Problem is that I need more funding to make it worth my while. I only have a few hundred k's that I can contribute. It won't look impressive. My cyber account is much cheaper to use now than a hedge fund and I can get my results audited if necessary. I would want more money to prove to people that I can do this with a few mil b/c people have a hard time believing it is indeed possible.
p2, I assume you trade alone. The first question you will get when you make a marketing call is "Who is running things while you are out chasing funding?" Your best bet is your father's rich friends. I'd rather have them mad at me than Tony Soprano or whoever else some money finder comes up with. Buzzy Schwartz's book Pitbull goes into this in some detail.
The book "Pit Bull" is about the trading carrer of Marty Schwartz. At some point he thought that he had to start his own hedge fund since he wanted to be at the very top, not only in performance but also in size and absolute earnings. His trading deteriorated and his stress level increased significantly. Although he had not much trouble getting funded, he soon choose to end the whole thing. At this time he also had some health problems.
You said at different points that you maintain more than one trading account. To the best of my recollection, one main trading account and one deep reserve (?) account to draw upon. Are your annual returns of the last 3 years inclusive of all these accounts, or do they just apply to your regular trading account?
P2: You have a lot to learn about hedge funds from your own admissions. They really are sophisticated ways of structuring a pool of funds. I would not advise you to take step into anything that you are not totally familiar with. Would you ever trade that way? Why don't you take the time to research the hell out of them and at the same time work on your portfolio with the goal of a 5 year stellar audited track record? By that time (2 years) with the compounding in your account you should have around $1M of your own funds that you can plow into a fund whether you have backers or not, just to get started. Funding should not be a primary concern right now for you. Believe me there is a hell of a lot more dumb money out there than smart money managers. Just prove that you one and the other will beat a path to your door. A friendly note. Hope it helps.