2019 Hedge Fund Contest

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FinancialDave
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Re: 2019 Hedge Fund Contest

Post by FinancialDave » Tue Jan 08, 2019 11:11 am

FinancialDave wrote:
Fri Jan 04, 2019 10:45 pm
Blue Contrarian Fund

LONG:

JCP
Tanelorn,

Blue Contrarian Fund does not believe in the limited upside to short funds.

Please correct my entry as it looks bad starting out exactly where I finished last year :oops:
I love simulated data. It turns the impossible into the possible!

Tanelorn
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Re: 2019 Hedge Fund Contest

Post by Tanelorn » Tue Jan 08, 2019 11:17 am

aristotelian wrote:
Tue Jan 08, 2019 10:16 am
Something is wrong. The stock I picked to short is up 5% and I appear to be in last place. Clearly a spreadsheet malfunction, please fix!
I did not know what you’re talking about - everything is working just fine the way I see it :happy. In a completely unrelated note, Tanelorn Capital is off to the races with first place and a 30% gain for the first day of the contest.

Tanelorn
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Re: 2019 Hedge Fund Contest

Post by Tanelorn » Tue Jan 08, 2019 11:41 am

FinancialDave wrote:
Tue Jan 08, 2019 11:11 am
FinancialDave wrote:
Fri Jan 04, 2019 10:45 pm
Blue Contrarian Fund

LONG:

JCP
Tanelorn,

Blue Contrarian Fund does not believe in the limited upside to short funds.
Oops, fixed (long instead of short JCP). And you’re in 4th place already!

Tanelorn
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Re: 2019 Hedge Fund Contest

Post by Tanelorn » Tue Jan 08, 2019 10:24 pm

Tanelorn wrote:
Wed Jan 02, 2019 2:10 pm
SHLD was indeed delisted and now trades as SHLDQ... The stock has nearly tripled off its lows in the past week, so those betting either way on Sears stock are likely in for a crazy ride.
Looks like I was right about the craziness for Sears - it went from down 30% this morning to up 30% by the close, doubling off the lows all within a single day! Tanelorn Capital went from the top of the ranks with +30% this morning to, well, we do take a long term view here so we’ll just short and hold.

Current standings - 2019 hedge fund contest

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LadyGeek
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Re: 2019 Hedge Fund Contest

Post by LadyGeek » Wed Jan 09, 2019 4:51 pm

The wiki has been updated with the 2019 spreadsheet. See: Bogleheads® contests (2019 --> Hedge Fund contest --> current standings)
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

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whodidntante
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Re: 2019 Hedge Fund Contest

Post by whodidntante » Wed Jan 09, 2019 7:32 pm

Power Mouse Capital letter to shareholders:

I feel like I should explain the apparently crazy positions I have taken with your money for 2019. I have shorted one of the most loved, most rip roaring tech growth stocks on the planet, Netflix. What you might have missed is that Netflix is a real house of cards (wakka wakka). They are debt laden, and they are spending huge piles of their investor's cash acquiring content. Their own experiments in producing content have also proven to be a cash shredder, with licensed content getting more viewing time. I guess they did have the highly successful bird movie, but the blindfold Sandra Bullock wore is a metaphor for how blind their leadership has become.

Combine that with the fund's only long position, Disney. Sure, you could point out that Disney stock has traded sideways for five years. What idiot would go long in such a stock? The idiot who has control of your money, that's who. Disney, you see, is launching their own streaming platform later this year. And they already have Hulu, so it's possible they even know what they are doing! We expect Disney to pull content from Netflix, or charge a king's ransom for it. And you can only watch the Netflix bird movie so many times.

But you are not a fancy hedge fund manager, so you really shouldn't worry about all of this. As always, thank you for the fees. I had a nice lobster and cognac for lunch. Was your McDonald's OK? Write soon!

Your truly,
whodidntante

goblue100
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Re: 2019 Hedge Fund Contest

Post by goblue100 » Wed Jan 09, 2019 7:35 pm

^^ Sounds the Marie Antoinette hedge fund. "Let them eat cake!"
Financial planners are savers. They want us to be 95 percent confident we can finance a 30-year retirement even though there is an 82 percent probability of being dead by then. - Scott Burns

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LadyGeek
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Re: 2019 Hedge Fund Contest

Post by LadyGeek » Wed Jan 09, 2019 8:16 pm

FYI - The spreadsheet is a complete hedge fund tracking system.

Click on the "Explore" button in the bottom-right corner to find a ton of statistics and pivot tables.

The top of the panel contains "Ask a question about your data", so I did.

"Who is the best fund manager?" was answered by the spreadsheet.
Wiki To some, the glass is half full. To others, the glass is half empty. To an engineer, it's twice the size it needs to be.

sorethumb
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Re: 2019 Hedge Fund Contest

Post by sorethumb » Wed Jan 09, 2019 9:16 pm

Pickle Rick Investments has a spreadsheet error. We are long Alcoa (AA) not Apple as shown. Thanks!

Image

Tanelorn
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Re: 2019 Hedge Fund Contest

Post by Tanelorn » Thu Jan 10, 2019 8:58 am

sorethumb wrote:
Wed Jan 09, 2019 9:16 pm
Pickle Rick Investments has a spreadsheet error. We are long Alcoa (AA) not Apple as shown. Thanks!
I’ve got your pickle antidote right here. Fixed (it was an autocomplete glitch - the fund above you in the spreadsheet had AAPL).

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librarianaire
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Re: 2019 Hedge Fund Contest

Post by librarianaire » Fri Jan 11, 2019 4:49 am

Apologies for not making this more clear in my original post: all three positions in the Social Epistemology Cardigan Fund are Short, not Long. It’s probably better to clear this up now, while I look like an idiot, than later, when it will be demonstrated conclusively.

Thanks for running the contest.
“Our own experience provides the basic material for our imagination, whose range is therefore limited.” Thomas Nagel, What is it like to be a bat?

Tanelorn
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Re: 2019 Hedge Fund Contest

Post by Tanelorn » Fri Jan 11, 2019 11:48 am

librarianaire wrote:
Fri Jan 11, 2019 4:49 am
Apologies for not making this more clear in my original post: all three positions in the Social Epistemology Cardigan Fund are Short, not Long. It’s probably better to clear this up now, while I look like an idiot, than later, when it will be demonstrated conclusively.

Thanks for running the contest.
Thanks, fixed.

FinancialDave
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Re: 2019 Hedge Fund Contest

Post by FinancialDave » Fri Jan 11, 2019 2:04 pm

BackOfTheNet wrote:
Tue Jan 01, 2019 3:22 pm
Again, I meant to get this up earlier, but this is the thread for the 2019 hedge fund contest. You can find the previous year's contest (2018) here:

viewtopic.php?f=10&t=236514
  • If a stock is taken out in a merger or a bankruptcy during 2019, we will do our best to do the right thing. An all cash offer will result in a freeze at the takeout price. An all stock offer will result in the conversion of the position to the acquiring company's shares. Mixed cash and stock offers, you'll just have to trust me to saw things off fairly.
Like last year, Tanelorn will be providing fixes and commentary as the year goes on.
Actaully, I have been wondering this for awhile, and one of the reasons the Blue Contrarian Fund does not pick Short bets anymore.

I see what happens when a company goes bankrupt -- so what happens when a Hedge Fund goes bankrupt, how do you accomodate that -- with an IOU?

I don't remember it happening yet, but this year may be the first.
I love simulated data. It turns the impossible into the possible!

Tanelorn
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Re: 2019 Hedge Fund Contest

Post by Tanelorn » Fri Jan 11, 2019 4:30 pm

FinancialDave wrote:
Fri Jan 11, 2019 2:04 pm
I see what happens when a company goes bankrupt -- so what happens when a Hedge Fund goes bankrupt, how do you accomodate that -- with an IOU? I don't remember it happening yet, but this year may be the first.
Hedge funds have a feature much like stocks - the most you can lose is all your money. You may think this sounds bad, but consider the traditionally “safer” managed account framework where someone trades with your permission in your brokerage account with limited access. They can’t just take your money and blow it on living it up or fly off to Panama with it the way Madoff or others have done with hedge funds that were really scams. Managed accounts, however, when they use margin as many hedge fund type strategies do, can lose more than 100%, and since it’s your account, you’re on the hook if that happens. Here was an example of an options trading manager who blow up 125% or so of his clients money.

https://earlyretirementnow.com/2018/12/ ... s-debacle/
The advantage of the separately managed accounts is that there is perfect transparency. Every customer of OptionSellers.com has their own brokerage account and they can readily see and monitor their positions. The clients merely authorized Option Sellers to perform trades on their behalf. Of course, the disadvantage of this setup is that clients are now on the hook for their underwater accounts. So, they lost not just their investment but owe more money to cover the additional losses. In a true hedge fund structure you can only lose your principal but as an LLC equity holder or Limited Partner in an LP you owe nothing further.

FinancialDave
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Re: 2019 Hedge Fund Contest

Post by FinancialDave » Fri Jan 11, 2019 5:24 pm

Ok, fair enough.

No limit on the upside - except for short stocks 100%.

No limit on the downside - except for long stocks 100%.

Only tempered by your ability to "close" down a position at any time, which must be done before market close if you want that days price.


Sound about right?
I love simulated data. It turns the impossible into the possible!

Tanelorn
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Re: 2019 Hedge Fund Contest

Post by Tanelorn » Mon Jan 14, 2019 7:54 am

Congrats to ladycat, drk, and Dumb Luck for their shorts of the troubled CA utility company, PG&E (PCG). They announced this morning they are filing for bankruptcy in response to the legal liabilities associated with the their possible role in the recent wildfires.

https://www.businesswire.com/news/home/ ... 005370/en/

None of our savvy fund managers were long, and we hope none of our readers were either.

Mrmetalpole
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Joined: Tue May 15, 2018 6:12 am

Re: 2019 Hedge Fund Contest

Post by Mrmetalpole » Mon Jan 14, 2019 9:03 am

Too late to enter?

Long BMY, MTN, CHL, CVGW

Short: TLRY

Tanelorn
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Re: 2019 Hedge Fund Contest

Post by Tanelorn » Mon Jan 14, 2019 9:10 am

Mrmetalpole wrote:
Mon Jan 14, 2019 9:03 am
Too late to enter?
Yes, deadline was a week ago, sorry.

Tanelorn
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Re: 2019 Hedge Fund Contest

Post by Tanelorn » Tue Jan 15, 2019 1:09 am

Tanelorn wrote:
Mon Jan 14, 2019 7:54 am
Congrats to ladycat, drk, and Dumb Luck for their shorts of the troubled CA utility company, PG&E (PCG). They announced this morning they are filing for bankruptcy in response to the legal liabilities associated with the their possible role in the recent wildfires.

https://www.businesswire.com/news/home/ ... 005370/en/

None of our savvy fund managers were long, and we hope none of our readers were either.
And our leaders are off to a good start, each up over 10% in the first week of the contest on the back of their presciencent short pick PG&E (PCG), who announced an intention to file for bankruptcy in the coming weeks if no legal bailout was forthcoming from California for their wildfire liabilities. The stock is down just over 50% today.

Current standings - 2019 hedge fund contest

Dumb_luck is in first place with a 20% return. Congratulations on your quick and ongoing success! I see this mornings market is even worse for PCG stock, as bailout hopes are fading and default is increasingly likely.

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ReformedSpender
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Re: 2019 Hedge Fund Contest

Post by ReformedSpender » Tue Jan 15, 2019 9:21 am

whodidntante wrote:
Wed Jan 09, 2019 7:32 pm
Power Mouse Capital letter to shareholders:

I feel like I should explain the apparently crazy positions I have taken with your money for 2019. I have shorted one of the most loved, most rip roaring tech growth stocks on the planet, Netflix. What you might have missed is that Netflix is a real house of cards (wakka wakka). They are debt laden, and they are spending huge piles of their investor's cash acquiring content. Their own experiments in producing content have also proven to be a cash shredder, with licensed content getting more viewing time. I guess they did have the highly successful bird movie, but the blindfold Sandra Bullock wore is a metaphor for how blind their leadership has become.

Combine that with the fund's only long position, Disney. Sure, you could point out that Disney stock has traded sideways for five years. What idiot would go long in such a stock? The idiot who has control of your money, that's who. Disney, you see, is launching their own streaming platform later this year. And they already have Hulu, so it's possible they even know what they are doing! We expect Disney to pull content from Netflix, or charge a king's ransom for it. And you can only watch the Netflix bird movie so many times.

But you are not a fancy hedge fund manager, so you really shouldn't worry about all of this. As always, thank you for the fees. I had a nice lobster and cognac for lunch. Was your McDonald's OK? Write soon!

Your truly,
whodidntante
:mrgreen: That letter will be hard to top :mrgreen:
Market history shows that when there's economic blue sky, future returns are low, and when the economy is on the skids, future returns are high. The best fishing is done in the most stormy waters.

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