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valuewalk.com December 07, 2016

Morgan Stanley: Quant Hedge Funds Unable To Profit On Post Election Moves

The typical stock finished with 53% of its risk not explained by macro factors. High beta stocks beat low beta by 15% in November. Previous markets were largely driven by beta market performance drivers, as risk not explained by beta factors were only 37% in July.  “Reduced equity market volatility is a driver of the increase in stock-specific risk.”
Read by 53% of LPs

valuewalk.com May 17, 2016

Age Matters More Than Size in Hedge Fund Performance, Says Study

When the study looked at the period after the financial crisis, however, considering performance from January 2009 through December 2013, the results changed.  The cumulative return of small funds wa...
Read by 36% of LPs

valuewalk.com October 21, 2015

Commodity Supercycle Decline Might Be Finding A Bottom

Many commodities are reaching their cost floor and should be in a bottoming process, a Barclays report notes, as commodities after the supercycle appear to be approaching support levels not seen in 14 years. 
Read by 33% of LPs

valuewalk.com October 19, 2015

Eric Peters Looks At Migrant Crisis Through Wary Swedish Eyes

Traveling the world and commenting on the human situation in his distinctive singular fashion, Eric Peters, Chief Investment Officer of One River Asset Management, notes Syrian refugees streaming across the for now wall-less Swedish boarder as he observes an unemployed group of what are oddly not women and children, but men heading into an un-affordable Stockholm housing market. 
Read by 79% of LPs

valuewalk.com October 16, 2015

HFs: Signs Of Correction Fatigue - Commodities Next?

Hedge funds were net sellers of equities over the past four months, Societe Generale’s October 9 Hedge Fund Watch reports in “Early signs of fatigue,” a title that points to their analysis. But this “risk-off” stance appears to be shifting from 5th gear to neutral which could be among “initial signs this trend is inverting, which could imply the bottom of the current correction is about to be reached,” the bank’s Global Asset Allocation research team, headed by Alaln Bokobza, observed. If their analysis proves correct, a corollary impact might be felt in the volatility market as net long VIX...
Read by 63% of LPs

valuewalk.com October 08, 2015

Hedge Fund Buys Peru Defaulted Debt, Demands Full Payment

As a U.S. hedge fund snatches up old, defaulted bonds and pressures the government of Peru to pay-up in full, Peruvian leaders might do well to check their trade agreements carefully because what is likely to force their hand is one of the most controversial components of the Trans Pacific Partnership: the ISDS dispute settlement process. Peruvian court’s had ruled that the bonds are worth just $400 million and afforded the Peruvian government a degree of latitude in repayment terms. Gramercy, however, is claiming that with inflation and various other economic adjustments the bonds could be worth $5.1 billion and they are...
Read by 44% of LPs

valuewalk.com October 08, 2015

FBI Agent Reveals Insider Trading Investigation Tactics

A small criminal percentage of people on Wall Street tarnish the reputation for a vast majority that are honest and hardworking, said FBI special agent David Chaves. But the small percentage of those who break the law, cheating honest Wall Street participants, must be identified and prosecuted so as to deter future market manipulation. The man in charge of the FBI team that led to the largest insider trading prosecution in recent history, putting behind bars the likes of former hedge fund manager Raj Rajaratnam and McKinsey partner Rajat Gupta, said initially the FBI had very little visibility into the...
Read by 71% of LPs

valuewalk.com October 01, 2015

Can Hedge Fund Returns Be Replicated By ETFs?

If an investor can find actual alpha in a hedge fund investment they should be willing to pay 3 percent (management fee) and 30 percent (incentive fee), Nikki Tippins, managing director and head of Americas equity derivatives distribution at Morgan Stanley (NYSE:MS) said during a liquid alternatives panel discussion at the Morningstar ETF Conference. Acknowledging that Hedge Funds who can outperform a benchmark offer significant value, she said if alpha can't be found "don’t pay 2 percent / 20 percent for something that can be replicated.” Tippins acknowledge hedge funds are an important component of an institutional allocation and reiterated that...
Read by 68% of LPs

valuewalk.com September 29, 2015

Hedge Fund Allocations Growing, Market Neutral Benefits

Investors in the Barclay Capital “Midyear 2015 Global Hedge Fund Industry Trends and Allocation Outlook” have, on average, their largest portfolio allocation to alternative investments, a trend that has gained steam recently but one that has been intact for the past decade. Unlike the traditional 60 percent / 40 percent allocated towards stocks and bonds respectively, the traditional institutional portfolio looks different. Pension funds, family offices, private banks and insurance companies, on average, have a portfolio that looks more like 41 percent alternatives, 31 percent invested in stocks and 21 percent in fixed income. The allocation towards alternatives is strong...
Read by 36% of LPs

valuewalk.com September 23, 2015

Steinbrugge Looks To Re-insurance Hedge Funds

Most re-insurance hedge funds (along with many of the investments) use quantitative analysis to determine event probability and price their insurance premiums above the probability level. In an era where investors have been reaching for yield, competition has reduced return to a degree, but investment managers have the ability to forecast, with a reasonable degree of accuracy, future revenue and payout projections, which comforts investors. There are issues to consider when investing in a re-insurance hedge fund, which he outlines in the white paper, but one must consider that in general the investments often feature limited liquidity and lock-up periods....
Read by 71% of LPs