NYT: Hedge Fund Impresario Plays Host in Las Vegas

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NYT: Hedge Fund Impresario Plays Host in Las Vegas

Postby jebmke » Thu May 09, 2013 12:15 pm

This was in today's NYT. I didn't see if it had been posted earlier.

http://dealbook.nytimes.com/2013/05/08/ ... f=business

The explosive growth experienced by the industry a decade ago has plateaued. For four consecutive years, the average hedge fund has failed to beat the Standard & Poor’s 500-stock index.

Despite the weak performance, hedge funds, which have a total of about $2.5 trillion in assets, are still attracting money, taking in $15.2 billion in the first quarter of this year, according to Hedge Fund Research.


The quoted Skybridge fees are remarkable. The 2/20 is common but I hadn't heard of the other grabs.

On top of the usual 2 percent management fee and a 20 percent cut of the profits charged annually by the hedge funds in SkyBridge’s portfolio, the firm adds a 1.5 percent yearly fee, along with a one-time placement charge paid to the broker that runs as high as 3 percent.
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Re: NYT: Hedge Fund Impresario Plays Host in Las Vegas

Postby nisiprius » Thu May 09, 2013 7:28 pm

“Mutual funds are the propeller plane,” writes Mr. Scaramucci in his primer, “while hedge funds are the fighter jets.”

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Re: NYT: Hedge Fund Impresario Plays Host in Las Vegas

Postby Fallible » Thu May 09, 2013 8:31 pm

nisiprius wrote:
“Mutual funds are the propeller plane,” writes Mr. Scaramucci in his primer, “while hedge funds are the fighter jets.”

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:D
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Re: NYT: Hedge Fund Impresario Plays Host in Las Vegas

Postby 2b2 » Thu May 09, 2013 9:29 pm

Well, they'd better get those "fighter jets" out of the hangar.
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Re: NYT: Hedge Fund Impresario Plays Host in Las Vegas

Postby NightOwl » Thu May 09, 2013 11:08 pm

nisiprius wrote:
“Mutual funds are the propeller plane,” writes Mr. Scaramucci in his primer, “while hedge funds are the fighter jets.”

Really expensive and prone to breaking down?

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Re: NYT: Hedge Fund Impresario Plays Host in Las Vegas

Postby Random Musings » Thu May 09, 2013 11:34 pm

For all the hype about quants, math geeks and this mythical asset class that people "need"', hedge funds are just an empty promise that line the pockets of the carnival hucksters who run this game. I'll wager that most of the money they collect off their marks ends up in the index/passive camp.

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Re: NYT: Hedge Fund Impresario Plays Host in Las Vegas

Postby saurabhec » Thu May 09, 2013 11:34 pm

SkyBridge isn't a hedge fund, it is a fund of funds, which always layer in fees on top of whatever the underlying hedge funds charge. The NYT article is typical of shallow reporting on the hedge fund industry. Comparing hedge fund performance to a long only index during a 4 year bull run is about the most skewed benchmark one can construct. No hedge fund is 100% long all the time. The reason hedge funds continue to gain AUM is because most actively managed long only funds are closet index funds which mostly underperform passive benchmarks. Hedge funds at least in theory offer a more compelling absolute return alternative to them.
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Re: NYT: Hedge Fund Impresario Plays Host in Las Vegas

Postby momar » Thu May 09, 2013 11:53 pm

nisiprius wrote:
“Mutual funds are the propeller plane,” writes Mr. Scaramucci in his primer, “while hedge funds are the fighter jets.”

Paging Mr. Ferri... paging Mr. Ferri... Mr. Ferri please call the operator...
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Wait, so now they're not even content with yachts?
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