It's pretty dismal out there in institutional land. Learn to trade and get all the upside and freedom. https://www-bloomberg-com.cdn.ampproject.org/v/s/www.bloomberg.com/amp/news/articles/2018-12-04/hedge-fund-dream-job-is-vanishing-as-harsh-new-reality-sets-in?amp_js_v=a2&_gsa=1#referrer=https://www.google.com&_tf=From %1$s&share=https://www.bloomberg.com/news/articles/2018-12-04/hedge-fund-dream-job-is-vanishing-as-harsh-new-reality-sets-in
it took a long time before people understood that investing in hedge fund was a fool's game. it took the creation of ETFs and John Bogle to reveal the reality. as long as people think that investing in a hedge fund is the same as joining an exclusive club the game will continue.
Hedge funds are equal as much as traders are equal -- not at all. Most exclusive hedge-funds still exist but don't accept OPM.
There's another thread... Any fund that will take your money isn't worth the investment. "I don't care to belong to any club that would have me as a member."
small trader / investor has the advantage his trades don't affect the market. small investur can take positions that are significant for his performance but the allowable size for a large investor is too small to make a difference in their performance.
The dream is getting some percentage of the upside on a big pie and the only downside is you go back to a salaried job like most. A much better gig that trading your own money if you can get it, but I don't feel too sorry for the folks who successfully milked that system for 15+ years with an average $500K/year take-home.
professional money management business is a tough business. regulations hamstring many operations from really making big money. then clearing firms will target you and front run all your positions which diminish your returns. better off staying small and private with multiple accounts to offset trades which creates obfuscation.
It is not really an advantage that your trades do not move the market, you are at the mercy of the big boys and must think like them 100 % of the time to be highly profitable, or have to retreat to non popular sectors where they do not go. Being able to throw your weight around for specific option plays is hugely rewarding, look at Icahn for example, plays that can take a few weeks to months to setup... I agree with your second half, if you see a small cap company failing hard, put it and reap a 80 k profit on it, for a retail that is a decent trade, hedge funds wont even bother with it, a lot more opportunities when your account is smaller then when its whaled size for sure
With all the massive closure of hedge funds, I am worried about one thing, liquidity and volume in the market. These funds used to make up a sizable amount liquidity and volume in the market right after the banks and the brokerage houses. Now that they are gone, who's going to take the opposite side of my transactions? Who's going to execute my orders? It's not that we can't make money in a down market but that we are being impeded from doing so cuz now everybody is hoarding on cash. It's like we are winning the fight but now we have no enemies to fight with anymore and yet we still can't take the castle. This is what happened to the retail forex market during the 2008 financial crisis. You wake up one day, all of the volume is gone and your profit potential is slashed in half! I hope the same thing does not happen in the stock market this time.