35 Burst results for "Hedge Funds"
How Decentralized Is DeFi?
"What's going on guys. It is wednesday july twenty eighth and today we are asking. How decentralized is decentralized finance. And why does that matter. So yesterday i did a show on three separate hearings on the hill that related in some way to digital currency that show also covered a letter sent by senator elizabeth warren to treasury secretary janet yellen in the context of her role with the financial stability oversight committee. This is hardly the first time. I've had multiple regulatory topics to cover on the same day. And that i think reflects just how much discussion of these issues is now. Happening at the highest levels of government in some ways this was an inevitable byproduct of the most recent bull run not just in the sense. That higher prices and more attention bring more scrutiny. Although that's part of it it feels inevitable in the particular composition of this bull run. It's one thing. If crypto is a silent off segment of weirdos and malcontents and internet people even if they keep getting richer and raising the value of their magic internet. Money's it's something different when all of a sudden the participants are traditional financial institutions. The concern start to magnify both from consumer protection standpoint as well as from a systemic risk standpoint if banks are allowing people to access bitcoin buying selling and holding from their accounts is there a greater consumer protection challenge if hedge funds which have historically been points of failure for the larger financial system. Suddenly start to opaquely. Load up on crypto. Does that mean a new type of systemic risk are stable coins being adopted actually a threat to the dollar system that government currently controls for regulators. These seem like reasonable questions. And thus we're seeing much much more scrutiny.
Can a New Wave of Crypto IPOs Rekindle Wall Street Excitement?
"Anyways today. We're discussing the robin hood. Ipo and the circle ipo and whether they can get wall street. Stoked on crypto again. So first let's talk some background. In retrospect the coin base ipo as the top sort of looks super obvious right base ipo on april fourteenth and the bitcoin all time high depending on your exact source came within around twenty four hours of that event there was an extraordinary amount of hype around this which by the way is technically direct listing. Not an ipo. But either way there was a ton of hype and it's because in many ways it wasn't just a single event. He was the culmination of an entire narrative which had been driving the industry for upwards of a year that point. Bitcoin had surprising resilience post black thursday crash in march twenty twenty hedge funds. Particularly paul tudor jones start to notice and explicitly identify it as a good trade in the context of massive global money printing. And this wasn't hard to understand right. It was an incredible moment to c- bitcoin supply issuance pro grammatically have had the exact same moment as central banks were getting comfortable with bigger balance-sheets than ever and by the way paul tudor. Jones wasn't even close to the only hedge fund who bought into this narrative by late summer. Early fall some others like stand druckenmiller. We're going on cnbc to say so as well and turn michael sailor and the bitcoin treasury bat and all of a sudden there's an additional dimension to this institutional by narrative other companies like square follow. Suit some really unexpected players. Come in as well like mass mutual's one hundred million dollar bitcoin. By which is where many of you probably. I heard of a breakdown sponsor night dig all of this creates an incredibly strong clear narrative picture going into the holiday in the new year. And then we get alon tesla's one point five billion dollar. Bitcoin treasury by dwarfs at least the initial by of micro strategy and we really off to the races and then coin bases listing is announced and it seems like the combination of things a major truly legitimising company from the crypto space moving into public markets
Sticking All of Your Systems and Data Together With SaaSGlue
"Your host is tobias. Macy today interviewing rich and bart would about saz glue assess based integration orchestration automation platform. That lets you fill the gaps in your existing automation infrastructure. So rich can you start. Introducing yourself share. Yeah my name is rich. Would i've been developing software for too long twenty plus years in the financial services industry in big data mostly dulling distributed systems and now currently helping to found saskatoon and bart. How about yourself. Basically the same thing except oil and gas financial in healthcare and going back to your hd member. I good involved in the area of data management. So i started my career in the hedge fund industry building real time distributed trading systems dealing with really high volume low latency stock market data and two thousand eight. When the hedge fund industry wasn't done solo. I switched to the data industry. So for about ten years i've been building distributed felt tolerant scalable datum pipelines and bert. He'll get involved in. Data management rich turned me onto it a lot more experience with graphics in front end in or distributed real time systems but not as much data pipelines. So so you've both been working on the glue platform and you've co created it along with year two other brothers and so before we get too much into sas glue. I'm just curious if you can give some flavor of what inspired you to actually found a business with family and how well that's been going for you particularly as four brothers. Yes oh that's kind of an interesting story. So the brothers are jack j. Rich in myself. Bart in about three years ago. Jay and a friend had an idea for just as simple script owner. That could be done remotely and rich got on it in and once rich got on it i got on it and then jack kim a little bit later
Using Your Left and Right Side of Your Brain When Investing
"If all it took to be a successful investor was plugging numbers into equations. Full of greek letters. Then wouldn't anyone with a calculator be rich. It almost seems like the miracle gymnastics. You perform the worst. The result go read about that hedge fund run by a bunch of famous. Phd's and nobel prize winners. That blew up. I'm not saying the science of investing isn't important. You need math skills. What i'm saying is that there's also an art of investing like when i'm thinking about investing in a stock although listened to the company's pass earnings halls and read past quarterly reports and play with pass numbers. But then you need to make a guess about the future what my apple or zoom look like in five to ten years was my view of their management team how might their growth strategy evolve. Is there moat getting deeper and wider. The answers are totally subjective. And i've noticed the investors who really excel at assessing and judging the intangibles. Just use lots of common sense. They see things so clearly think so clearly. They also easily change their mind but don't change their mind easily. Which reminds me of the story about picasso. Have you heard it. It goes like this. Because i was sitting in a paris cafe when an meyer approached and asked if he would do a quick sketch on a paper napkin. Picasso politely agreed swiftly executed the work and handed back the napkin but not before asking for a rather significant amount of money. The admirers was shocked. How could you ask for so much. It took you a minute to draw this. No picasso replied. It took me forty years the longer you invest the more you realize that being good at investing has little to do with combing through mountains of data or spending hours crunching numbers to be good is blending science and art is hard data and soft data left brain right brain. Any artists will tell you that art is not knowing what comes next not knowing how the future unfolds you can never entirely no so the artist like the investor makes guesses. They might be wrong but they keep at it.
E3 2021 Is Around The Corner And Here’s Everything You Need to Know
"Annual electronic entertainment. Expo is taking place in a virtual format this year. Nintendo microsoft's xbox ubisoft entertainment and capcom are all at this year's e three while sony and activision blizzard are skipping it xbox game studios halo infinite bethesda software star field ubisoft rainbow six quarantine as well as new games for the nintendo switch. We'll be some of the more closely watched. Titles a wild card to watch is whether ubisoft will tease out. Information about its open world star wars game
With AMC Shares up 1,100% in 2021, Company Sells Shares
"Movie theater chain AMC is raising two hundred thirty point five million dollars by selling eight point five million shares of stock I marches are a letter with the latest AMC stock price jumped more than eleven hundred percent this year yes people are going back to the movies as corona virus vaccinations increase but that's not why AMC is a so called memes stock along the lines of what happened to game stop large institutional hedge funds bet on AMC stock to fall while online investors banded together to force a short squeeze AMC management says the company will use proceeds from the share sale to invest in new leases and on improvements in existing theaters
Engine No. 1’s Big Win Over Exxon Shows Activist Hedge Funds Joining Fight Against Climate Change
"And so how did this vote actually come about a small hedge fund called engine number one which was just recently formed and which holds a very tiny stake in exxon mobil far less than one percent manage to galvanize support of massive investment funds like calpers which is californian mega pension fund. The new york state employees pension fund out more than a trillion dollars worth of capital are held by some of these more progressive pension funds. That are very interested in the issue. Climate change it won the support of important proxy advisory services as they're known such as i s in blast lewis these agencies give recommendations that are often followed by the big institutional investors on how to vote and they both supported the tiny dissident for a change in exxon
Big Oil Companies Take Some Big Hits on Climate Change
"I'm looking here to list of the biggest corporations based on their market capitalisation what the company is worth overall. Exxon ranks thirty third which is pretty big. It's a big company but it used to be number one. Exxon is worth a fraction of. What some big tech companies are these days in fact. Exxon is worth a lot less than exxon used to be worth. It faces big uncertainties because of climate change and that is the context for a meaningful shareholder. Move a tiny hedge fund managed to place two new directors on exxon's board and maybe more in an attempt to shift exxon's business strategy toward renewable energy. it's one of many oil companies under pressure. So we're gonna discuss this with. Npr's camilla dominance. Good morning. Good morning what happened to exxon well. A brand new hedge fund started last year with the express purpose of putting new members on exxon's board over the intense opposition of exxon's current leadership. This hedge fund argued that one exxon had made bad investments. That's part of the reason why they are not the corporate titan that they used to be like you mentioned they also said fundamentally. The exxon doesn't have a good plan for preparing for a world that tackling climate change and. I'll emphasize here. These are investors making an a financial argument other investors right. They're not saying exxon needs to stop burning oil because it's bad for the planet. This argument is look. The world might stop buying oil because of concerns over climate change so exxon better have something else to sell them. It'd be bad business not to prepare for that. And this tiny fund persuaded enough other shareholders to join them that they actually one at least two of these seats in in this election.
A Tiny Fund Scores Historic Win in Battle Against ExxonMobil
"Energy leads the way kinda surprising. News out of exxonmobil's annual shareholder meeting today ticker symbol x. Oh by the way turns out a hedge fund a relatively small a hedge fund called number one which holds a very small slice of exxon mobil. Stock has convinced some other much bigger shareholders that they should put a couple of engine number one's candidates on that company's board of directors candidates that would and this is the important part force exxon to cut back on its fossil fuel strategy and investments. And do more about climate change. It sounds insanitary. I suppose a little bit of corporate governance but it is a very big
Shopping for the Web
"This season. We've been unpacking the longest year in tech history. Nineteen ninety five. The year our future began so much started in that time but few changes were more consequential than the advent of online shopping. In just a couple of decades it's grown from a handful of startups to a team of goliaths and we couldn't live without them. But as we'll see the dominance of certain online shops is only partly due to brilliant business maneuvers. Now like i said amazon is not the entirety of commerce but it is the big fish in the pond so let's begin their why in nineteen ninety five did amazon start delivering packages. What made it possible. And what's at founder. Jeff bezos on a path toward shipping billions of packages every year. He immediately understood the whole idea of transferring currency at making trades with this new use of this relatively new technology. The internet robert specter wrote the first book on amazon. It's called amazon dot com. Get big fast and that should tell you something about the amazon origin story. It's a story about capitalizing on a particular moment. Seizing the day in the early nineties. Basil's lived in manhattan. He was making more than a million bucks a year working at a hedge fund that relied on algorithms cutting at the time and it speaks to the sort of business. Basil's believed it. A data driven business and automated business. Meanwhile the hedge funds founder. David shaw adebayo's and a few others to look into this newfangled internet thing see what kind of opportunities were there. So jeff and other people looked at various product categories. In of all things books rose to the top as the most obvious product category. Why books
David Swenson, Head of Yale's Massive Endowment Fund, Has Died
"Danny who is david swinson. And why does his death impact the show yes. We're recording on this thursday. We learned that david swinson. The longtime head of sales endowment passed away from cancer. At the age of sixty seven. Swinson pioneered for endowments the alternative investment approach of investing outside of stocks and bonds to hedge funds and private equity and venture capital. Obviously that really revolutionized basically asset management across the world it invented the modern dowman. That really built up the universities. You're no stanford. harvard princeton. All sort of used this to really buttress their financial powers of the last couple of decades and his losses a huge tragedy thing for the entire industry. I was just going to add one nine to yale's endowment to give listeners perspective my friend taneja pora put it out a graph showing swenson's impact on yale's endowment and says that he grew the endowment from one billion in nineteen eighty-five to over thirty billion and created eight billion in value through its performance alone. So this guy had a huge huge impact from a financial perspective and as you mentioned just culture and how we think about venture
Dow Climbs More Than 160 Points to Another Record
"Closing highs today with blue chips pacing the events. The Dow Jones industrial average rose 164 points to end the week of 34,200. Blue chip index down in the fourth straight weekly game theme S and P 500 moved up 15 points also to a new high, the NASDAQ composite added. 13 points, Morgan Stanley reported first quarter profits that more than doubled and revenue that jumped 60% to record levels. But huge trading losses related to the hedge fund. Archie goes, weighed on Morgan Stanley's stock. Shed 2.8% U. S. Oil prices fell slightly halting afford a streak of gains make crude slipped 33 cents to settle it. 63 13 a barrel Still, though it logged a weekly rise of 6.4%, that's your money now. In the
The Real Story of Inflation Right Now
"What's going on guys. It is tuesday april thirteenth. And today we are talking about the real story of inflation right now. New consumer price index or. Cpi out from the bureau of labor statistics and this is the latest entrant into the great inflation debate. I want to discuss the complexity of that conversation but to do so we have to go back in time just a little bit in may of twenty twenty just a couple of months after assets crashed around the beginning of covid nineteen lockdowns. Paul tudor jones published. What i believe will go down as one of the seminal treatises in the history of bitcoin. The piece was all about what he called. The great monetary inflation quote the depth and magnitude of the economic off took modern monetary theory the direct monetization of massive fiscal spending from the theoretical to practice without any debate. We are witnessing the great monetary inflation an unprecedented expansion of every form of money. Unlike anything the developed world has ever seen for those of us in the bitcoin. Space even more significant than the diagnosis was the proposed remedy. Pj and his team had surprised even themselves by getting convinced bitcoins role in that sort of macroeconomic context. They had turned bitcoin bulls. This was a seminal moment in the institutional turn towards. Bitcoin and the essential thing wasn't just that an influential hedge fund guru got into a pet asset. It was this setup around inflation that people could see and feel for themselves a few months later stand. Druckenmiller went on cnbc echoed many of these themes. He said for the first time in a long long time. I'm actually worried about inflation. He went as far to say that he could see inflation getting his highest five percent to ten percent for a time. Now part of the reason that druckenmiller cited for this was a shift in fed policy a new willingness to let inflation run hot specifically the fed had indicated that rather than shifting monetary policy based on projected inflation. The fed would only change policy. Wants a target level of inflation had already been
Reimagining How and Where We Will Work
"Me today to fantastic guests to talk about the new hybrid work environment. Karen mongia and ray dallaglio. Karen is an internationally recognized thought leader and three time author for most recent book working from home making the new normal work for you is highly relevant to our conversation today. She's blogger speaker and has been featured on tax forbes thrive global among many others. Currently she serves as vice president of customer and market insights at salesforce karen. Welcome to the conversation. Thanks so much. It's great to be here also joining us today ray. Dalia raise the legendary investor and world renowned entrepreneur. He's the founder of bridgewater associates the largest hedge fund in the world and author of the number one new york times bestseller and number one. Amazon business book principles. Ray thank you so much for joining us today. And you've avenue so today we're going to discuss the new hybrid world of work and what it means for all of us. Current yearbook working from home is filled with practical tips on what it's like to have a successful work like from home and something. I think we all still need some help with perhaps so tell us maybe what we've been doing wrong. It's impractical tips. What you'd recommend to be effective in focused working from home. I think about it not so much about what. We're doing wrong as discovering what we could do right to help ourselves live and work in a sustainable way you know if you watch successful athletes before they take the field of play most of them have a great warm up ritual right something that shows them in signals to their brain there in the game and they're getting ready to be all in and in the world of work from home that looks like routines rituals and boundaries that helps signal to our brains into ourselves. We're getting ready to go to work. And also importantly we're leaving it that there's a point in time at the end of the day where we have a ritual that allows us to leave to power down that laptop in truly tak- transition
Archegos And The Fastest Loss Of Wealth In History
"What's going on guys. It is thursday april first and instead of bringing you some fun cheesy fake story. I decided to go in the exact opposite direction. Today we're going to be talking about leverage corruption and cheap money the fastest wealth in history. We are talking about arche ghost. This is a story that many of you have been following for coming on a week. Now it is certainly one of the crazier macro stories. I've ever covered here. It involves a traitor with dubious past a group of investment banks coordinating takedown double crossing margin calls and an eraser of fortune. Thanos style tens of billions gone in the seeming. Snap of a finger on the one hand. This is the story of an individual trader. A twenty year icarus who finally flew too close to the sun on the other. It's a story of a market as a whole a market. That is made money. Extraordinarily cheap which normalized extreme risk especially in the form of leverage. Let's start with the man at the center of the story bill. Bill's career started under the tutelage of the legendary hedge fund manager julian robertson in one thousand nine hundred eighty julian robertson founded tiger management. One of the earliest hedge funds. Tigers run is the stuff of legends building from eight million in start up capital in nineteen eighty two over twenty two billion in the late nineteen ninety s when robertson unwound and shutdown the fund. In two thousand. He started the next phase of his career which was investing in the funds of his former employees the so-called tiger cubs to be clear. This isn't like one or two funds. We're talking about thirty five to fifty of the world's top hedge funds rob citron's discovery stephen mandl's lone andreas halvorsen. Viking philippe lafont kuwata management which you may recognize as the lead investor in dapper labs new three hundred and five million dollar round from this week and one of those hedge funds from the tiger cubs was called tighter asia management and came from bill hong
Volkswagen takes on Tesla with major electric vehicle push
"In the World Electric or otherwise. But Volkswagen is engineering a plan to race ahead of Ilan Musk's company. In just four years. We are good and 2 25 or so that's Volkswagen CEO Herbert Dese. Company has announced plans to build six battery factories in Europe and to put out a million electric and hybrid vehicles this year alone. But he says VW is looking beyond this decade. This transition is not only about evey, so it's also about the car becoming really a connected device and finally also Driving autonomously. Something he says, could be about 15 years away. But D says 2021 is the year the company will prove it can compete on battery power. You think that we can prove This year that we are strong in TV that we are competitive in TV, and then we have to prove that we're strong enough common in autonomous in software on Ben, the market will follow on Ethan Hager Bloomberg Radio. Why do hedge funds and other
Maryland businessman offers to buy Tribune newspaper company
"Maryland businessman has offered to buy the Tribune Publishing media company that owns the Baltimore Sun, The Chicago Tribune and other newspapers. Choice Hotels. International Chairman Stewart Behnam offered 650 million for the company. But the Chicago based company's board is already endorsed a $630 million offer from another busy bitter New York hedge fund al Din, Global capital. Tatum has said he wants to turn the sun into a nonprofit.
"hedge funds" Discussed on Exchanges at Goldman Sachs
"And they're certainly in a much stronger position in terms of investor appetite than we've seen for some time within the hedge fund space there are definitely some areas of focus among allocators criti- dozen twenty one. That are worth highlighting for some strategy perspective equity long short is the most sought after hedge fund strategy overall with forty three percent of allocators telling us that they plan to increase allocations to the strategy. But there are a lot of different offerings within the space and specifically we continue to see a focus on sector oriented funds especially those focused on areas such as biotech and tnt. Which has been invoked for some time. Now we've also seen a really nice uptick in demand for discretionary macro managers after a couple of years strong performance and this is probably been a bit at the expense of systematic or quant strategies including. Cga's where we've seen a decrease trust geographically. We see a clear trend towards asia with nearly half of allocators telling us that they're looking increase exposure in the coming year and within that of very strong bias to china which again is the continuation of a trend that we've seen for some time. So have the allocators rethink portfolio construction in twenty twenty. And what does that mean for managers so before we came into twenty twenty really declared trend for the hedge fund industry had been one of portfolio concentration of consolidation. So allocators have consistently been telling us for years looking to reduce the number of hedge fund manager relationships. They have reduced the number of line items in that portfolios and in turn made those relationships with hedge fund manages more substantial an of course why that matters is that in turn it makes life very difficult hedge fund managers from an advertising perspective in an environment where everyone is consolidation their portfolios your ability to win a new allocation from an investor is constraint just to sort of.
Sharp Questions Fly at GameStop Hearing; Citadel CEO Testifies
"Online brokerage firm Robin Hood and read it facing probes by the Departments of Justice, the Commodity Futures Trading Commission and both chambers of Congress. That investigation and some sharp questions on display today's congressional hearing. The Wall Street Journal is reporting that the stock of the video game retailer shares soaring this last month to above $480 a share. Keep in mind that was up from just $18.84 on January 2nd of 2021 the surge fueled in part by an army of an individual traders, they were buying shares and options and trying to squeeze out the hedge funds who were shorting the stock. Now, the episode has led to questions about the markets integrity. It's also set up a zoo said Just a moment ago, US. There is a federal investigations into market manipulation. Prosecutors have subpoenaed information from brokers like Robin Hood, then the online brokerage company that many individual investors used to trade. Gamestop is one of a zealous other stocks among those testifying Keith Gil. He is with the Chicago based hedge Fund Citadel LLC. I'm happy to discuss with the committee my purchases of Gamestop shares in my discussions of their fair value on social media. It is true that my investment in that company multiplied in value many times for that. I feel enormously fortunate. I also believe the current price of the shares demonstrates that I've been right about the company. A few things I am not. I'm not a cat. I'm not an institutional investor, nor hedge fun. I do not have clients and I do not provide personalized investment advice for fees or commissions. I'm just an individual whose investment in Gamestop and post on social Media were based upon my own research and analysis. I grew up in Brockton, Massachusetts. My family was not wealthy. My father was a truck driver in my
"hedge funds" Discussed on WSJ What's News
"Turning to washington and the latest on the game stop frenzy treasury secretary. Janet yellen is said to meet with top regulators. Today to discuss the many issues that have emerged. This initial meeting will include officials from the sec and the fed according to former officials and analysts. The discussion is unlikely to reach any conclusions on whether the activity points to risks to financial stability or the need for regulatory changes. It wasn't just individual investors making a lot of money on game stops rally in a wall street journal exclusive world reporting one hedge fund in particular made a profit of nearly seven hundred million dollars joining me now with more on how this came to be as markets reporter caitlin ostrov. She is in london. Good morning caitlin. Wanting mark caitlyn so much of the movement upward has been propelled by day traders but some hedge fund managers actually bet on the stock rising. Yeah so you've had this narrative of on forms like it's wall street bets that come about of you know all of the little guys of the day traders kind of taking on these hedge funds better holistically betting that stocks like games talk will wind up falling but not everything has always as clear. Cut in black and white in some hedge. Funds also took this contrarian view that may be the market was being a little too beating up on games talk and so you actually had one hedge fund some best which actually started at on of games top. You know at the end of last year. September october and turned into profit of nearly seven hundred million for them because they start buying wind chairs were close to ten dollars and they sold when they were close to four hundred and caitlyn. We've seen a lot of volatility with game stock and others. What has been like this week. Yes performance for a lot of the so-called robinhood stocks the stocks that are very heavily favored by day traders We've been less strong moves this week than we did last week. you know. We had shares of games. Top shooting up over one hundred percent in a single day and now trading is a little bit more rangebound between you know maybe five and twenty percent that is obviously still vividly high volatility. But it does show that maybe some of this valley is losing a little bit of steam or a little bit of momentum ceylan ostrov thanks for joining us. Thanks for having me
"hedge funds" Discussed on Stansberry Investor Hour
"While i agree that it was a poor excuse for direction i think. The intent of many of the instigators was clear while it is clear that the mob was highly disorganized without any significant amount of planning. It was clear that they as a mass intended to do grave harm to legislators and staff there. even though is a libertarian. Share your disdain. For much of the media is typical portrayal of events politics. In this case. I think the incidents have been relatively fairly presented and indeed. The whole situation was quite a serious threat to the lives and wellbeing of representatives and to our democratic process. Such as it is. I'll just deal with that. Half before i get onto the second one definitely not any kind of a threat to our democratic process. You're just wrong about that. It was much bozos who disrupted things for a day or so serious threat to the lives and well being of the people involved. Yeah that's why they evacuated them absolutely. It was a serious threat and people died. I don't make light of that. But you know when. I said frat boys going blind when frat boys go wild people die two sometimes so but maybe that is to cavalier. It was a riot. You're right it was a riot next. One that he takes issue with members said he had two things next one he says but of work concern was the implication. You made the cutting off of social media. Access to president trump was of similar severity. To that of nazi. Roundups gonna stop you there. I did not say anything like that. I'll continued out by quoting the paraphrasing of the niemoeller by one of your listeners. I believe you drew a very offensive analogy. Certainly as a libertarian minded individual you would agree that private companies that provide social media platforms are well within their rights to limit and control the uses of content. whether is it advisable for them to do so debatable. And more properly a matter of concern to their shareholders even if there is some political bias involved too but to imply to such private actions are a violation of any of our first amendment rights or even more absurdly or even in the slightest bit comparable to genocidal nazi roundups of thirties as patently offensive your fawning reading of the in my opinion poorly written paraphrase certainly gave the impression that you consider the two situations similar threat to our lives and liberties. I've always respected and admired your opinions willingness. Please state them. But i have trouble believing your value systems have been co opted by the extremist trump cultists. He's a so..
"hedge funds" Discussed on Stansberry Investor Hour
"Performing combat. Communications training exercise in the heart of manila. There are a few main differences between what happened to dc compared to what happened in the philippine coup. D'etat first of all. There were no grenade bearing militants and assault rifles in the philippine coup. There are lots and lots of explosions and ak forty seven spouting off all around us second. There were no aircraft involved in the philippine coup. There were world war two tora. Tora planes dropping bombs at the manila capitol building third. Neither the marines national guard got involved immediately in a true khuda. Tov marines would have arrived in helicopters. Dropped out in sequence as they surrounded the white house fully armed aiming outward and ready to kill anyone who approached fourth during the coup. The entire nation was gripped with fear in america. We watched it on. Tv with a cup of coffee in her hand making funded them and having no fear of government upheaval so for my personal experience. What happened in the white house was nothing like a real coup. But then he says. Ps when a completely different topic what technology do you think will ultimately win the automotive race. Electric or hydrogen will be a hybrid of the two. I'm looking to invest in nikola. Because i strongly believe hydrogen will be more widely accepted since it's just like gas pump and go. I'm thinking the full scale. Conversion would be easier with automobiles and filling stations than installing charging stations on every corner waiting for a charge. What your thoughts run from. Nikola are there better. Hydrogen players out there. Thanks mill the only question. I'll answer is who's going to win. And i don't know and i don't need to if you want to speculate on that. Just understand that nikola is speculation and that you are speculating on an outcome that you can't possibly know and you probably have to do a ton of work and even then after you do your ton of work. You're still trying to predict the future. What i suspect is the case. I would suspect that you're going to see. A bunch of different technologies get already got hybrid electric which is getting getting pretty big and and you know this hydrogen fuel cell idea which has been around for a long time there may be others and who knows what they'll be. It's hard to pick winners in this type of thing. That's i'll say just acknowledged that. You're speculating okay. You you can lose all of the money that you speculate with so just you know size your bed. Accordingly michael w writes in and says dance quest to find someone who can opine whether president trump's egging on his supporters to descend on capitol hill constituted a coup attempt..
"hedge funds" Discussed on Stansberry Investor Hour
"I mean in a sense. We're we're a strange animal because you know because in some ways imitation is the greatest form of flattery But we also believe that you can build. You can pay too much for great house or great car and a lot of what we written on an hedge funds it's not hedge funds for all the criticisms of hedge funds in the two thousand ten's they didn't really have an alpha generation problem. They had a few probably the alpha. Was there but it was pensioner's pension funds investing with hedge funds where billionaires were getting much richer three percent a year and And so there is something You know within the industry. That's very very upside down And the hedge fund fee structure has been very much of a heads. You win tails. I lose proposition for a lot of investors..
"hedge funds" Discussed on Software Engineering Daily
"Software engineer at numerous zander. Welcome to software engineering daily. Thanks very much. Numerous is a new kind of hedge fund. And i want to work our way towards discussing numerous with some simpler discussions. First of all what is a hedge fund will very simply heads fund is A collection of money that allocates those funds into the stock market typically. I mean you have some alternative. Investments so hedge funds that investing in crypto currencies. But typically. you've got hedge. Funds that invest in the us stock market or worldwide stock markets japan etc. What is the term hedge referred to so actually hedging bats so in terms of only Creating risk for folios and making decisions based on those risk assessment assessments. So basically i have some idea of what the market is going to do. And i'm going to hedge based on that idea. So i'm going to make certain balances to Have a good risk portfolio those kinds of things. so what's the financial structure of a hedge fund. You have investors. You have people who are actually placing bats. Where are the incentives in typical hedge fund. I think i see what you're asking. So actually a hedge fund will have lp's limited partners and the limited partners are external to the hedge fund. And they have nothing to do with what the fund actually does so the limited partners will give some amount of money to the fund and then the fund will be completely responsible for actually allocating okay. Let's talk about the market. Even more broadly there's some large percentage of the market. That is automated. You could call it bought so you could call automated trading. Even the humans that are doing trading are mostly using automated orders. Can you give me a sense. For what kind of software hedge funds and trading desks are using. Yeah that's a good question. So i suppose it depends very much on what kind of trading doing so there are funds that trade on very long time horizons so. That's six months to five years sort of trading and that treating might not even be automated. Because there's really no need to such a long term Position and then you have high speed trading which is taking place on nanoseconds. So obviously that's a very much automated and those are probably mostly custom. Software suites written by the funds themselves but of course there are tons of software suites that typical hedge funds us. They have software that interfaces with With fun sorry with. What's the term nasdaq for example changes. Exchanges thank you yes different packages interface with exchanges to place trades or to go through various brokers etc. Right so machine. Learning has crept into wall street's over time machine learning has been used before it was called machine learning at places like jane street or trading firms. You know through wall street. How prevalent is machine learning wall street and by the way i totally understand. You are not a financial expert for context for people who are listening who don't know sander. He's a software engineer. He's got a background in software engineering. He's never worked in finance So i'm asking you this as somebody who may not have any insight into this but i would love to know like what's your perspective for how trading companies use machine learning. Yeah that's very accurate insofar as my finance nonexistent but it's my understanding that most funds are not doing anything like machine learning so you do have quantitative finance which is probably the closest that most funds come to doing machine learning and i think you have some funds like to cigna or renaissance technologies. That probably are doing some machine. Learning and those are the kinds of funds. You'll actually see with booths at nips. They're they're really interested in that kind of talent but those are really really rare for hedge funds and for the most part hedge funds are not using machine learning at all and actually i think what most of them do is what i call trading. It's kind of humans making bad decisions based based off of very little data because humans actually can't put data in their brains. Okay so we'll get to that question. And i have some follow up questions about that but a company that's doing machine learning or actually basically any type of trading they're typically building financial models so a model is a vision for the way that the world is and where the world might be going describe what goes into a financial model. Yeah so there's a huge spectrum for what could go into a financial model so closer to our end of the spectrum you can have something like scraping quarterly earnings reports and then doing some kind of analysis based on how frequently does something appear in the report or like What do the numbers look like in the report and you could make On the one hand you could make a report human digestible report and make trades. Based off of that or on the other hand you could frame it in a machine. Learning problem format where you actually predict the market directly from that information whether it's word frequencies or Number trends but i guess like the simplest financial model would be like take stock price data and just see if you can find trends and that's of course we're random walk theory comes into play and you find out that doesn't work very well but that's kind of the basic idea of financial model or a super super basic financial model would be i think companies that I think companies that are out to. Ipo are going to be worth a lot. That's a financial model. It's a stupid one. But that's an example of something super simple. You could do to allocate funds. There's a model present a version of the world or does it also make trades. I would say a model simply presents version of the world and there are various degrees of how you connect that to making trades so you couldn't actually include in your model making various things like risk balancing or you could not and then Your model is just saying. I think this will go up on. This will go down and then it's also job to balance risk. I don't want to have all of my funds allocated in a single market. I don't want everything. I buy to be in agriculture. That's very risky. So you want to balance it across. I have some tack in some agriculture. Some japan some in the us. And so you you could structure your model such that. Whatever it whatever comes out of it is exactly what you will be placing on the exchange or there can be various degrees of humans Human decision making between the model and the actual exchange..
"hedge funds" Discussed on Monocle 24: The Bulletin with UBS
"Hello and welcome to the bulletin with EDS Monaco twenty, four each week, the.
"hedge funds" Discussed on Masters in Business
"Your risk parameters are very different and if if if V if I'm running net fifty percent long okay that means that Fifty percent is correlates to the asserts that meet and also fifty percents Beta and fifty percents outlets. So if I'm up fifteen and the S&P is up fifteen percent only seven and a half half percent is alpha yet. I'm charging too and twenty and twenty percent is on both Alpha and Beta so Fifteen so twenty percent of fifteen percent is three percent three plus two is five. I'm charging five percent on a Um Five percent divided by seven and a half percent. Just follow me with the math. Athen you know Your listeners can Rigging Kibo they can kind of work this out for themselves. Samatha Ethic Group. It's a mouthy group that means two thirds of the Alpha by that equation is going to me the hedge manager and one third to the LP's. That's not a winning goats Tristan. Then you have hedge funds like the multi managers where it's all Alpha everything. They generate his alpha. It's correllated it's low volatility pretty. That's why an end so that's totally defensible. Business model and jumping onto another subject the startup environment while so few funds can scale and we have so we have more closures than startups. These days. The exception to that rule our funds that splinter off from the successful accessible multi managers. That's why we saw exodus point. Have the biggest launch and Hedge Fund history last year at eight billion. That's why this year you see would line and candlestick To Citadel spinouts launched with anywhere somewhere between one and three billion candlestick I was between one and two and will be an end would line is between two and three. These are exceptions that prove the rule and also shine a light on the efficiency of this of the Hedge Fund universe you have hedge funds that are struggling to come up with the fee structure that can address the lack of value creation. And then you have funds like element that are charging two and forty again again. It's a it's it's efficiency are less I met you discussed all sorts of really fascinating things. I wanted to circle back to in particular about the shifts and where institutions are putting their money and the fee structure. So so let's start with with the fees one of the things I've I've seen that's been kind of interesting and you explained earlier. Why institutions hate to pay Alpha prices for Beta? Is the rise survey so-called fulcrum fee where there's a very modest fee on assets and the actual profit sharing fee the the typical two and twenty part of the fee is not on with the S. and P. provides but only on the excess performance so it might be instead of the two and twenty twenty five basis points and thirty. What what do you think of those sorts of fee structures that they have any longevity? I think that that we need to We need to move to a model which is closer for if you're if funds are going to charge what they charge whatever whiches ages sizeable We need to move to a structure where LP's are paying for Alpha. That's the bottom line so whether it is they lower their fees or the just charge on Alpha that has to be where the industry is going it. Or and or here's another thought there are hedge funds comes with which Really and this is true of a of a lot of the single manager long short equity cubs longshore equity funds whether tiger cubs or related needed. Some of these guys are really vast at generating long alpha. They're really not that good on the short side and if you look closely at the composition of their return earn the shorts are actually volatility enhancers and Alpha detractors. But they have to short because they're hedge funds right. They can't charge to in twenty without out with just having a long only model and it's very hard to short when the market has at least for the first half of this bull market just rampage straight up from Oh nine to twenty twenty foot scored if it's not there it's not. It's not what they do best there are and they're also not set up To do it as well will as the multi managers that have much broader and deeper resources to help these guys be successful With with respect to with respect to managing factor volatility and coming up with single name Alpha shorts so the best thing the these more concentrated directional channel managers could do would be to say okay. I'm best generating long Alpha therefore let me set myself up in away where I maybe it. They create an alternative long. Only where I think this is the way of. This is how a lot of these funds are going to go I mean recently saw in the last year Sore Ban Eve really converted most of assets to long only and so the idea being If I'm best degenerating long Alpha and not that good at managing short-term volatility and coming up with with alpha with Alpha shorts Elvis Alpha generating single named shorts. But I need to three or four years to let my thesis Lisa play out. Then you know what you know. Maybe you just charge on Alpha at the end of that time period and so that's a very and it's a totally different structure. But that's the the point you need to figure out what your best at it's so hard now to generate consistent Alpha. And you need to figure out what Structure sure is going to enable you to be competitive and that may mean locking up capital for a longer period of time and charging less or just charging on Alpha but the idea idea that one size fits all when it comes to fees no matter what you're investing style is or how much Beta you employ is ridiculous. You know the guy charging to the it's the same fee structure for the guy running net thirty running net sixty so I think there should be a hurdle With respect to how much is Alpha Beta. You mentioned how many Hedge Fund closings that were in two thousand eighteen typically when a fun shuts down does that money. Johnny leave the space or does it just rotate to a different hedge fund At least from an institutional perspective well given the trend line I shared shared with you earlier which is we have now sixty billion of net outflows to the industry. That's that's net outflows I think money is actually leaving the industry. That's where I think things are going and so it could go to another fun but the problem is there are so few good options were it doesn't want to go to another fund that has had the same meh eh or crappy performance. A lot of the better funds candidly are closed right. That's the truth. Yeah Sean So. And that's why you see when when when guise splinter off from the funds that are closed and LP's are salivating for access to the they're the ones that scale overnight and they're only so many of those so that's why I think we're seen the The aggregate amount of net outflows and also the trend line with the thing on the trend. Line is the only other year in Hedge Fund history where we had four consecutive quarters of net outflows. Was Two thousand eight to two thousand nine. That's a meazza probably Q.. One twenty and nineteen the the only other time in Hedge Fund history. We saw four consecutive quarters and that was an and Q.. One two thousand nineteen this year we had fifteen billion of net outflows. We're now at sixty something so I guarantee you we're now in our sixth quarter net outflows. That is first time ever in Hedge Fund history. That's amazing so the FA- I don't want to call it the flavor of the month with it's a little too Glib but it's clear that private equity is the shiny new thing. Lots of money seems to be flowing in that direction is that who is the beneficiary of the outflows from hedge funds. As if you're an institution and you know you're expected returns for equity is going to be five or six percent and bonds yielding less than two percent and alternatives are promising eight nine ten percent do these outflows outflows. End Up going to private equity. They do but interestingly and and it's true that in the last four or five years while hedge funds have suffered it because their returns have come down and for most of them fees have had to readjust or in the process of readjusting. Private equity was was had the hot hand because rates were low and And it was you know it was easier to to buy companies I think that but it's but you know I think what we're seeing now is the murder merging of Public and private UC private equity firms. Trying to get into the public markets gets you see Hedge funds developing their private Investing expertise and so. I think each one is trying to capitalize relies upon the others revenue stream. That's quite interesting One of the things I I read about you that I thought was pretty amusing. There was a event a gala that you helped put together earlier this year and one of the CO producers of the gala was Steve Cohen of Now point seventy seventy two and he discussed what a challenge. It's been for so many hedge funds and basically said no one's winning the Hedge Fund game. There's this this. Recruitment process where people go from one fund to another to another. And the only one who wins is you he kinda dragged. You know No just to be clear. The gala was in honor of me. I was so we Was a little bit of roasting roasting. I think I hope I think it was. He was introducing loosing me. I was the honore so I think it was mentioned as good nature and okay. It's also because when you read it. It's like wow Steve Cohen's really drinking but it's nothing like it was seen that way. I think his point was there is a war for talent. Because there's so little of it right there only myself. They're only so many people I put in that I bubble of best in class class that is true And you see it with the returns of funds or so only so many funds that are performing in only so many people within those funds tails. Don't lie doesn't lie. That's what I love about this industry. It's real time it's marked market. You know where you stand at all times but You know the so and we so that is true. It's there's an intense competition to attract the best. It is also true. We tend to be in the mix of it but the the other thing that's true is much as there are only so many good people there also so they're only so many places those people are going going to be attracted to and Steve runs a great shop point. Seventy two is one of them Other places like Sid El Millennium Davidson Kempner golden old intrigue. The there are there are there are places that had built something unique and are going to be able to do something special to attract talent Alan and make them more successful because of the very fact that they are on those at those funds or on those platforms and that's what creates a symbiotic relationship relationship between talent and the best places that exist in myself at the end of the day. We idea w has been very deliberate about who we choose to work with. I mean not gonNA name names but there are plenty in terms of the ones we choose not to but because we need it is is is good as I'd like to think we are at the end of the day. The people we are dealing with on the talent side. They are very sophisticated. They are very smart and and and they're not gonNA go somebody someplace. That isn't a market step up from where they are today with a pathway. That is unique. AAC and Enor- would I feel good about trying to convince them to do that. So I have tremendous conviction around the the I've to have tremendous conviction around the what around our clients and what they've built and what they can provide for talent and And so again I think it was a joke but at the end of the day. They're only so many places that also talent really wants to go. Can you stick around a bit. I have so many more questions breath. We have been speaking with a lot of Weinstein. She is the founder and CEO of the W. Group A leading boutique for Hedge Funds Family family offices in private equity searching out top talent..
"hedge funds" Discussed on Masters in Business
"She got her undergraduate degree from the University of Pennsylvania and her the NBA from Harvard. Alana Weinstein welcome to Bloomberg Radio. And I add that because I've seen you on Bloomberg TV many times but I don't recall ever. We're here in new on Bloomberg radio. This is my first time Berry. So you've been in the asset management industry for more than two decades. How did you end up on the recruiting inside? The short answer is I was really young and I was still trying to figure out what I wanted to be when I grew up. Literally I gone to H. B. S.. After a Ura Coleman literally went from Penn from my dorm room to my parents. He's home work to Goldman for a year and then And then went to. HBO and Just to go back and answer your your question. I ended up going to the Boston consulting group really because I felt I needed to get a post. Mba To my MBA. I wanted to figure out What path I wanted to take what sorts of problems I wanted to solve? What industries were interesting to me and And this is in the I was in my late twenties unease. This is in the mid nineties so the DOT com. Because that's of course what we called it back then the dot com bubble was just bubbling Ling and within a year and a half my entire class of MBA's CG the class. I entered with was gone so I was literally. They'd all gone to to seek their. You know starts next whatever. Give me a big fat sluggish stock options and a stock that just goes up ten percent a day and everybody jumped at it and done right and you can imagine how that ended for. Most of them It depends on if they knew went to hit the bitter not if they were smart and took off some risk not too bad. The people people who didn't so they had gone to try to start dot com companies and I that wasn't my Gig. I wasn't I realized I didn't really really I'd learned a lot of BC. Gee I didn't want to be a management consultant As a as a career path and I still was figuring out. What do I wanNA WANNA do and before I committed to Any particular pathway. I figured I would jump into another meal. You you where I could learn again more about companies and functions and just figure out where I wanted to commit to and so I joined a large recruiting infirm. Thinking that would give me a purview and as it turned out I was really good at it and I fell into a quickly joined their financial services practice. And and that's how does high ended up recruiting And so you end up focusing a little further along in your career on hedge funds private equity family offices so what happened was After about a year or two. They're the DOT COM bubble burst. And they're this. Is this this big search firm. I was at their financial services. Practice was really focused. More on investment banking equities traditional asset management. Sort of what. I'll call older your school. Businesses compared to what I really fell into in started to focus on which was back in the late nineties early. Two thousands as you'll remember these were this is what was fueling the sell side. This is where the action was. It was the prop groups and it were. It was these new first of their kind type. Financial products it was called so was credit. Correlation asset swaps was even called credit derivatives back then highly structured sure first of their kind derivatives types of transactions. That's what we were focused on for the sell side clients that I was working with. And that's that's where the juice was and all of a sudden I developed my own business which was on fire within this big firm and it just became obvious obvious after a few years to me To really try to do this on my own given I was acting effectively independently within in a larger construct which was having issues at the time. So let's talk also about the timing as you were explaining that I began to think about the timing timing. If we go back twenty twenty five years what were there two hundred four hundred hedge funds. Today there's eleven thousand. Your timing into that ramp up could not have any fake barry right I planned it perfectly talk right I mean so so all these and Goldman Sachs is is infamous for saying to a group of traders who they smell might be Itchen head out. Hey why don't you guys go set up a hedge fund we'll get you. Capital will will prime broker for you and we'll steer some potential clients to you and that's how they built an immense prime brokerage business. How much was the Goldman Sachs connection? Helpful ores use an analyst. I realize just understand. I started a golden in the middle of my senior European. I mean 'cause I just was I don't know I was stupid. I was like working. I just I got through all my classes. I didn't. I didn't have enough fun in college. Bottom line is it making up for it trying to make up for a long time now but I finished with my classes. I started middle of my senior year. I was out within literally a year to H. B. S.. So think about it I was. I hadn't even graduated from college so this was it was that was not it really cat. What really jumps started my business? It what it was however You are correct signaling. The sell side as as a driver of hedge fund talent because back then it was the prop groups were the precursors to hedge funds. It was it was these you know again high-octane And these were the guys who got paid the most on the sell side. At the time I still felt like they weren't capturing as much of their pinellas they want it. Well you know. E E within a sell side context. They were doing as well as they possibly could. Then you could be a superstar prop trader and earning twenty thirty forty million bucks a year. which which doesn't happen anymore? You could be earning more certainly than the CEO. But they're they're buddies were leaving Many of whom were Goldman partners or just were Just like again. high-octane prop traders from Credit Suisse from Deutsche Bank for Morgan Stanley from J. P. Morgan and they were setting up shop in. Remember back. Then you could start with fifty in scale to a Billion Brooklyn very quickly quickly and so and all of a sudden there's no headwinds from any other part of the bank. There's no cap at all in terms of how you get paid. You can do whatever you want. And if you're an entrepreneurial neural person who is a great investment professional and that's your passion and that's what you WANNA do. Why be part of Bank? There is no headwind to getting into this business and scaling thing. If you could produce the goods and back then you could do that a lot more easily quite quite fascinating. Let let's talk a little bit Alana about how Your Business Works. I do hedge funds and family offices come to you looking for slots to fill our the traders and and fund managers reaching out to you. What is the structure? Sure like so I mean back up and tell you which I'm actually quite proud of. We've been in business for almost seventeen years. Seventeen gene this February most of our clients. We've been working with practically if not since the beginning beginning certainly within the first first few years of inception of ID W so what that means is we're We really know their business. We've helped them build their business and yes. They are coming to us for specific assignments. Whether it's an end the common thread being they are all all senior people. Who can move the needle whether it's a some into do b. a. t. m. t. p. m. for equities Someone to run in emerging markets. Business someone someone to build and run distress but at the same time and this goes back perhaps to my B. C. G. Background. I really our our role. My firms role is is to also be an adviser to them as well as to the market so it. It's I'll give you two assignments. Were working on today. And the Genesis of it Each sh each one is arguably for one of the biggest and most sophisticated hedge funds in the world one I started talking with the founder at the end of the summer. About a new business he wants to build. He runs a forty billion dollar hedge fund super successful and he wants to create something holy other than what he does today. So we're helping him find somebody who could oversee that and build that. That's that's a very sophisticated person. WHO's not this? Isn't someone looking for a job. This is somebody who has actually had great success with what they've done in the past and this is kind of an interesting maybe chapter to An and is successful as they've been it's an opportunity for even greater wealth creation the second example. I'll give you is another Client that is almost as big Again again these are two of the most successful hedge funds in the world very forward. Thinking guys This is a client. We've worked with for a long time. I came to him and I said to him. MM-HMM there. I see an orb in the market. Right now There is a universe of people who are really talented and are stained gained where they are not because they're happy but because a better option doesn't exist in if you created this I think you could capture that alpha. Oh Fuck right this this group of individuals that have been phenomenal pl generators even in the last few years where it's been very difficult. He's now building that business. So it's both Working on discrete assignments for our clients as well as coming to them with advice about where to take. Take their How to take their funds foward that that's fascinating so if someone comes to you and they're looking to fill a specific role? What is your thought process? Like when you're trying to to say who do I know that might be a good fit for this or if I don't know anybody in particular who comes to mind. How do you go about creating King of a pool of applicants that could fill that role? Well after again almost two decades doing this we typically You know most of the plains. I'M NOT GONNA go so far as to say we have the answer before we began. Although that is often correct like actually formerly begin this someone says something. Yeah I know in the back of your head I have just awesome we. We've done so much work in every conceivable asa class so many times That when we start something. It's rarely truly brand new. What can be because certain strategies more cyclical than others so for example When we did the here's a good example when we did the head of emerging markets for one of our clients?.
"hedge funds" Discussed on Animal Spirits Podcast
"Twenty percent on earnings i so help them understand why that was the case and help them on the path ford so it was kind of this own simulated fund experience that was helping people manage and after about four years in the public equity space i i realize this is actually solves a massive unmet need for people which is something that's not quite set in forget it completely passive relegating themselves to a market average but also so not something where you have to be actively trading brokerage account because frankly most people can't do that and should not be doing that and so something in the middle actively manage platform that was built like a hedge fund seemed like like a like a great possible solution to that so you mentioned that you you do some scraping of the the funds from the thirteenth so we can get into what that isn't a minimum but how did you go up picking which hedge funds to us and how did you get comfortable wrapping your head around which ones you'd go with so based on my experience in long short equity. I realized most of long shrek refunds out out. There are actually not great funds for whom thirteen filings are representations in other words citadels millenniums and other sort of you know quote unquote fast money firms of the world are often in and out of a stock within a few weeks and certainly probably within a few months or quarters and what that means is thirteen filings which which as you mentioned you know there's a forty-five delay between when a quarter ends and fund has to report their holdings to the to the s._e._c. and that period of time means if you're a fast money fund filing could be completely stale realizes there's actually actually factors that are kind of embedded within each filing that are leading indicators of what type of strategy that funds running so for example sample if you look at it thirteen filing for berkshire hathaway or something with fifteen or twenty positions and that rarely deviates outside of that range and the bulk of their <unk> capital is allocated to the top few of those positions and very few of them change per quarter. You can sort of back into well. This is actually a very long-term focused low turnover fund for whom thirteen th filing link yeah maybe occasionally buffet may be out of stock before the filing comes out but more often than not. There's very very little slippage so to speak and so based on our experience in industry. It's a little bit of judgment <hes> but a lot of data science to basically take the universe of roughly four thousand hedge funds and basically dwindled down to only two or three hundred entered funds that we deem to be longer pointed quality focused on so what does a thirteen actually reveal so thirteen filing represents the long positions nations are effectively the stocks they own. It doesn't show any of the stocks. A fund may be short in also shows the options positions so call contracts are put contracts. Does it show number of shares. It was held down from there. You could say okay. This is a five percent position cracked it shows company named the ticker just the market value the position as with the previous quarter end and and i think it shows it definitely shows the at the sheriff's preposition so you can kind of back into the the effective market value per share the cost basis so let me ask you a question. Why do we assume that these people no anything like yeah. Why do you want to follow these people so we did quite a bit back testing so there's the personal experience that i've had in the industry so this is actually how many many long short funds source ideas. I think the hedge fund industry for a while has been selling perceived complexity to a lot of folks which is most of the massive passive outperformers of the last ten twenty thirty years have been the super stocks that now are dominating the market cap weighted indices and oftentimes the investment. Thesis was pretty straightforward. It was not something where you need to be have a p._h._d. In economics to construct and so i think it was my own personal experience coming to that realization plus back testing..
"hedge funds" Discussed on Animal Spirits Podcast
"Was there something in your hedge fund background that made you want to build. Something like this like. I've kind of railed on this for a few years is now the fact that hedge funds have illiquid fund structure in the fees are very high so the hurdle rates pretty high <hes> a lot of times. You don't know exactly what's going on in the portfolio voglio. I mean we'll just stuff like that that you saw there. Maybe is a better way to do. This was that part of the motivation here. Absolutely a huge part of the motivation was the second component on any of their value prop. Which is let's help. People be better investors than they have before an importantly. Let's build a research operation that is completely personalized to what they're investing. In the most frustrating things having been on the buy side was there's all these legal compliance restrictions to basically hedge the managers lack of willingness or lack of ability to explain his aggies and while it was whether it was selling perceived in complexity when they're just going along. This basket of thirteen funds thirteen stocks. They're buddies these. Are you know there's a number of different reasons for it but the bottom line was manager is would often not communicate without piece actually worked at simone funds so i worked at a fund called fairlon before that i i worked in a phone call cerberus. I had a ton of respect for those funds but it was the relationships that other funds that i saw where they were not communicate with l._p.'s except for maybe if they swung by the office they were they if they were in the area or quarterly letter and they relied on things like three five year lockups all these kind of gates to basically say this is how we're going to retain clients i i said i want to go build and operation where we can build the most transparent we believe high quality investment products but also we have no lockups we have have can get money in and out titan within two business days and so we purposely designed it so that we had to put a high bar ourselves to basically inform clients and so our retention is only correlated with our ability to effectively explain to our clients what investing and why and so that's the bet we're making longer-term. Where does this fit in the financial services the universe are you do you see yourself as competing with betterment of wealth front and traditional robo advisors.
"hedge funds" Discussed on Capital Allocators
"And it was going to take a lot longer. Now. You're three years later. What started to click? It just was sort of one off to be honest. You. To be grateful for and take pride in very very small win. So it's hey XYZ. Great entrepreneur, great, investor or good person likes and trusts you enough to give you a small amount because they believe in you. And that's a huge win. You're not gonna get really paid on it or not gonna change anything. But that I promise you if you keep working with those people, you're amazed at how then they'll tell another person, and we're starting calls now being like, okay. What's the next thing? You're working on inbounds. Like, we wanna do more with you. And it's it's all incremental the, you know, talking in the door with a normal nine vicar checks, but it's just these little things that start to build on each other. And it's natural to have doubt initially of. Okay. This person said no or they gave us a token amount of money that maybe they're just being nice because they don't want to offend me. But once you start to change that perception from UK, maybe they're just being nice to oh, they act. Kinda like what we do and you build that relationship. Everything just takes it takes years and those things are finally starting to happen. And that's been. It's been really cool. When I was at a big farm, I managed huge amounts of money for very very large investors. Now, I manage a little teeny bit of money. But for just like, I can't even believe how nice and cool, and I can pick up the phone if we ever need anything to any of our LP's, and they're there for me and the reverse is true. They don't pick up the phone in like Haiwaii down three percent this month. They all get it. And I couldn't be happier with where we are even though where a long way from where we could theoretically be. But again, if you're happy if you have good partners, and you're doing what you love that's success to me, and we've gotten lucky and just continue to sort of try to build on that you mentioned some of these inbounds about, hey, can you can do that you started with a flagship hedge fund. How did you start considering? Oh, should we incorporate along only? Fund should be incorporated a series of SP vis and what have you done? Another thing. We've tried to be cognizant of is do people believe in the efficacy of our process, but not necessarily the mouse trap that it's being fit into. I don't have any. Hubris or belief around that if we can be solutions provider to folks who fall under the following category. Good people believe in what we do willing to be oriented. We will think about doing a solution that makes sense for them. I think if I had my druthers we would on one fund, but particularly as were smaller, one of the things I wanted to make sure of is if different people had different views on volatility or duration that we could possibly look at these other products to nor to satisfy a customer water need without imposing anyone's particular view on our main fund, and so we've thought about partnering folks on different products. We're not there yet tone as you look out over the next year. What's your next most pressing goal for the business to continue to find good investments? I wanna spend as much time as I can really focusing on. Finding the two four good ideas year. And I wish I could find one tomorrow and we've gotten a couple of great opportunities in the volatility of October. And we're gonna spend two thousand nineteen really focused on factual outcomes in our current portfolio, and hopefully finding a couple of good ideas. All right, let's turn to some closing questions. What is your favorite hobby or activity outside of work and family? The only thing I do. These days is play golf outside of work and family, and that's my happy spot to be on a golf course. All right. How's the golf game? They stace pretty mediocre. The lake are investing strategy volatile. Sometimes really good and sometimes pretty bad. So the overalls still have decent. All right. What's your biggest pet? Peeve arrogance. I mean, it's just a tough one. It happens a lot in her business..
"hedge funds" Discussed on Animal Spirits Podcast
"Time to reverse it in sold their kinda stuck in these hedge fund allocations for a while i think i don't think it's going to be turning you know it is much with people think well there's a really good show that this though the study referenced and it appears to be that the rush for the exits is not really much of a rush at all because each there's a chart showing the average karn allocation of endeavour plans to hedge funds and it's been really really steady at between eighteen and nineteen percent for the last five years yeah and the thing is no one wants to get out of hedge funds during a bull market because it it's that murphy's lov what can garang well so they they assume once they got a patch ones than the market will crash and then they could have used them so they don't want to be seen you know flooding that lasts warren and then going all in on no longley strategies so yeah i don't think that the hedge fund community is is has much to worry about it's just basically the the poor performers them you know those are the ones were the the money's gonna flawed of but there's there will always be new ones putting up in in ones with good trackers where that money will flow to so obviously there's a little does a million different types of strategies so what would you set what do you think when people compare hedge wants to the sp 500 by in obviously makes no sense but it's kind of funny because when a hedge fund world is underperforming they say wait why you comparing us to the sp this is ridiculous and then when they're outperforming is a hey look how great we're doing compare to the sp in it's kind of this thing where i think the investors and he's funds they're the ones who pushed for this type of because there's no perfect way to benchmark a hedge fund because there's no good indexes that most of the time these indexes are full of funds that self report and there there's huge survivor bias.
"hedge funds" Discussed on Capital Allocators
"Sheng down namibia started already i know it may be i don't think so but let me let me try to explain why 'cause i've seen a lot of hedge funds obscene a lot along only funds over the years private equity who's a whole nother animal and even if you look at the academic data that consistently maligns hedge funds what you find is that for whatever reason this universe of hedge funds on a gross basis adds value and four more value than the traditional long only does on a manager by manager basis the problem is that it's being paid away and fees so one of the reasons why these fees have come up when the competition has gotten higher and therefore a relative skill is harder to assess is it the required return on a hedge from portfolio has just gone down and down and down so let me give some examples in in my early years at yale yell had and still has a a bucket they call absolute return the idea was equity like expected returns with less risk and certain less correlation to equity markets and back then maybe that was a five or six percent real rate of return that was the benchmark that ten years ago i saw dave swenson give a speech and someone had said to him very appropriately your benchmark for this asset classes what's called 5 percent real that's a seven percent rate of return for ten years you have made twelve percent how do you explain that and he sort of shrugged his shoulders the point being you don't need to make twelve percent of your cried red return was only 7 that's at seven percent was that real if you think about towards 5 points of alpha's really tough around that time the notion of what you have risk parody and portable alpha came into play and so you had precrisis he had a bunch of pension funds other institutions that said now we're gonna invest in had from portfolio and effectively by the beta that we want them are going to put this on top and if you think about what that means the required return on hedge fund portfolio dropped from a day when the l had it it.
"hedge funds" Discussed on Capital Allocators
"A blocker would help them and so just that simple part of what's a hedge fund or that something we want in part thanks to dave swenson's book in sort of the the stamp of approval that he and calpers when they invest and had since of her some two thousand gave hedge fund she had this period of time where just getting there was was okay clearly that's changed and people understand more and more what it is their buying you have firms like aq are who have made it a business to try to educate investors and show them the components of hedge fund and then give them a cheaper alternative to get access to some of those components as those things have happened you have more scrutiny over fees some of the scrutiny is simple and is backwards return looking and saying now let's say the numbers one and a half and twenty that's probably about right today that's too high if a hedge fund can only make six percent and that's fair because some percentage of what you're paying out and that's not reflective to what's that six se and as as its six percent alpha hey that's pretty good we're in his your percentage fame virement had transact they have to pay to play as opposed to an in four or five percent interest rate environment that can years past and so that's where we stand today if i had the gas and look ten years out because i think that's looking at the long game of this is what's most relevant it always baffled me that a hedge fund let's just to simplify it let's call it a longshot equity fund because that's easier for comparison launch at equityfunds charging when it happened twenty today in some senses competing with the long only fund were fees of also come down an act management maybe that's an eighty five basis points in eighty basis point feet and the only differences there is a pile of short that have added very little value over the last couple of years so i think what you're likely to see is ten years from now they'll be inactive management fee on the long side and the hedge funds that are charging a twenty percent sanofi they're really gonna be charging a fee on what's truly value added and that will get measured in lots of different ways in an equity world.
"hedge funds" Discussed on Capital Allocators
"Out forty different hedge funds okay how big is that world how many cedars of similar style or uh you know economics taking of scale or they're out there what's the competitive landscape like for producers addeds it's a really interesting question because when new hedge funds looked to get into business they think of ceding as a a grade avenue to start their initial distribution strategy in fact there are no more than a handful and you can effectively name them blackstone reservoir protege join robertson growth nerb fun fronts cog was doing some of it now and their families here and there that you hear about family offices that do that around the world but for the most part there are very few sheters there is a fair amount of capital there blackstone has a lot of capital reservoirs a lot of capital persia has a lot of capital but there are very few entities who seed hedge funds which which makes it difficult because there are so so many hedge funds that are trying to get into business that makes it very competitive landscape even to attract the seed capital so forty over the course of you know fifteen years or so rough roughly speaking what was the hit rate what was the of the forty a assuming everything i've read an of fascinated with kind of power law distributions of outcomes were you see like in the book when i wrote a book i i learned all about the economics of of publishing uh where effectively the winners the couple books that make the publishers year actually subsidize the long tail right because if they had those author selfpublished achieve similar success they would made a lot more money um and most of book publishing is is a failure and most had most startups today in any field but certainly in hedge funds to our our failure so there seems to be this this power law that governs outcomes so to that apply at protege across those forty i went to find it quite differently because proteges investment model was one of trying to achieve a certain rate of return relative to the risks that the investors were taking and in a diversified had trump portfolio that was wrong.
"hedge funds" Discussed on Capital Allocators
"Maybe no i'm sure this will be applicable throughout our conversation about from the allocators perspective finding worthwhile investments or managers of what were a couple of those those checklist items that seemed to work out more often than not in in yellen swanson's favour the circle back i'm one that is talked about very broadly today but nobody talked about twenty five thirty years ago which is creating a fair deal with manager so in hedge funds face for sure you hear a lot about fees you don't hear a lot about what should be inappropriate appropriate fee structure between a manager investors you just hear the fees are too high that was something that david in the team thought about back then and in fact almost all if not all i am a current but presumably all their hedge fund investments have a structure to them that make a lot of sense and any investor would love to be part of that they were able to do it by having a firstmover advantage and being there um so that was certainly one at one of david's big ones is independent ownership i have my own views on that which of of all of the being in the seating business doesn't have that so the notion of independent ownership is as an investor you want all of the money that you're paying to go to the management team of that fund and they stick very rigorously to that i've seen lots of notable exceptions that were climb at that so what you said your views and that one of evolved so assuming originally you're in swenson's camp and may be moved a little bit away yeah i i think that being out of that environment gives you a little bit more of a sense of what happens in the real world and so y'all has the benefit of having tremendous mena capital tremendous credibility with their board and their governance structure that allows them to invest early on too many of their investment sir with relatively nascent funds they can be so large and so important that they can effectively make the success of a firm and then structure that firm so it can best succeed longduration capital only really leading in certain types of investors and at is no doubt one component of yell success and something.