Goldman Sachs Flagship Hedge Fund Falls 11.6 Percent

Discussion in 'Wall St. News' started by Free Thinker, Dec 10, 2006.

    Goldman Sachs Flagship Hedge Fund Falls 11.6 Percent (Update1)

    By Katherine Burton

    Dec. 8 (Bloomberg) -- Goldman Sachs Group Inc.'s $10 billion flagship hedge fund dropped 11.6 percent this year through the end of November, extending earlier losses as its managers misjudged the direction of global stock and currency markets, according to two investors.

    Goldman's Global Alpha Fund lost money partly on wrong-way bets that equities in Japan would rise, stocks in the rest of Asia and the U.S. would fall and the dollar would strengthen, the investors said. In August, the fund lost almost 10 percent on unprofitable investments in global bond markets. New York-based Goldman is the world's largest hedge fund manager, with $29.5 billion in assets.

    Global Alpha, managed by Mark Carhart and Raymond Iwanowski, both 40, is designed to make big, risky wagers, which can produce large returns as well as heavy losses. Other so-called macro funds that bet on global stocks, bonds, currencies and commodities are up an average of about 7 percent this year through November, according to Chicago-based Hedge Fund Research Inc. Last year, Global Alpha returned almost 40 percent, said the investors, who declined to be identified.
  2. Typical lazy, mainstream "story"...
    That, in mathematical terms, is 100% meaningless...
    Designed only to manufacture "content"... and fill a news vacuum.

    A returns of hedge fund with this high level of risk/volatility...
    MUST be analyzed on a monthly basis going back several years...
    Otherwise it has ZERO meaning.

    I guess it's also useful to push that 5,000+ post count higher.
  3. HoundDog, it seems odd to attack the story. It's just Bloomberg, what level of analysis do you expect?

    And last I checked, hedge funds ARE analyzed on a YTD basis:

    Don't scapegoat Global Alpha Fund's terrible performance (comparatively) on a wrongful analysis of time periods. They made the wrong bets, they lost. Your reaction almost seems as if though you're tied to this fund somehow..
  4. WRONG!

    It is precisely because of this volitility that a larger fractal period, not a smaller one must be used.
  5. ``Since inception it has delivered positive returns for investors,'' he said. Rose declined to comment specifically on the fund's performance.

    Makes you wonder if this fund has pulled positive dollars out of the market or if its best % years were when it was much smaller than it is now.