Quadriga Blow Up

All good things come to an end.


http://www.bloomberg.com/apps/news?pid=10000087&sid=apv2M2NKqxHE&refer=top_world_news

 

I wonder if Maverick still has a job.

 

If you factor in mgmt. fees quadriga is down over 30%... thats pretty much blow up territory for a hedge fund.. no professional money will ever go to that fund again. Too much risk.

The two Christians will still walk away from this debacle millionaires... but they are officially toast.


--MIKE

 

This will be the fate of 90% of today's hedgefunds, IMHO.

These traders are no better than you or I at trading. They are just better at promotion.

Leverage and hubris will surely kill a huge percentage of these funds.

The market is unforgiving in that most must lose, for the few to win.

 

I dont think Quadriga had anything to do with GM blow up... atleast their fund's performance was not affected by it because they only trade futures.. their trend following system has come to an end.

 

Yep. Problem with overcapacity. Everyone jumping in front of each other. Too much money and not enough opportunities.

Did you read in the Bloomberg link above about how one of John Henry's futures fund is down 26% and the fund has $1.6B. That's like over $400M poof!

oh well.. just like anything else all bubbles end. The hf bubble will be ending soon... And only the really good will survive, which is how markets work.

Not everyone can win in the long run...

 

I sure do hope sure. That'd be nice.
Is there a trading bubble? Too many players, too many machines, etc.

 

I hope the trend followers get shaken out to the point where, most investors just start exiting in mass. That strategy that may have worked really well the the past 3 decades now is just too popular.

 

yeah so much for making money in any market.
bloomberg should run another interview with Baha

 

I really don't think going down -20% to -30% is a big deal. Any trading system that is shooting for long-term annualized returns of +20% or better will eventually hit a rough period. If you are a properly capitalized trader, you can take the hit and live to trade another day. The only certainty in the market is that it will trend again!

But 99% of the traders of this world implement trading systems and are not well capitalized to take a -20% or -40% or -50% drawdown. So given enough time they are guaranteed to blow up completely.

Bottom line: If you are not a well capitalized trader, stick to bank CDs and SPY.