Hedge Fund Outlook for 2018–No Grit, No Pearl
View PDF With equity prices still near historic highs, now is an appropriate time to take stock of the world’s capital markets and consider the outlook for hedge funds. Should investors buy, sell—or hedge? In this post I provide a framework for developing current return expectations and determining the appeal of a hedge fund allocation. […]
How Callan Categorizes MAC Strategies
View PDF By Mark Andersen and Jason Ellement Multi-asset class (MAC) strategies have existed for decades; the first product with an allocation to balanced stock and bond strategies was launched more than 80 years ago. In the 1980s, MAC strategies evolved, moving beyond static into tactical asset allocation. In the 1990s, MAC strategies expanded globally, […]
Kickin’ It with Risk
View PDF As MAD magazine’s Alfred E. Neuman proclaims, “What, Me Worry?” In the third quarter, global markets fully embraced that fearless mantra. And why not? Discarding past worries of stubbornly slow economic growth and other trifling distractions, markets focused on positive catalysts suggesting rising prices ahead. Corporate earnings worldwide enjoyed a notable uptick. Shrinking ranks of […]
Uncertainty Beyond the Next Eclipse
Unlike the laws of physics driving our solar system, our financial markets can surprise investors with moments of darkness.
As the World Churns, Despacito
View PDF Stock lovers embraced the slowly shifting narrative of global growth in the second quarter. Although hopes of a Trump bump faded further in the U.S. amid distracting Beltway theatrics, U.S. corporate profits remained resilient and credit spreads tightened modestly. Exhibiting little evidence of angst, the S&P 500 Index gained 3.1% while the Bloomberg […]
Open Protocol: Comparing Apples to Apples
Evaluating the risks of a large cap value portfolio against those of another has long been a relatively easy exercise for investors. However, evaluating the risks of an absolute return-oriented risk premia fund versus those of a relative value multi-strategy hedge fund is not, even though they can have the same stated investment objective.Investors who […]
Bear Market Ahead? Beware of the ‘False Charge’
View PDF When I was a Boy Scout backpacking in the Sierras, my troop assigned shifts of scouts at night to watch for marauding bears on the perimeter. To scare them off, the sentry clanged a pot or made some raucous noise. That simple response seemed to work fine—the fourfooted opportunist, however hungry, usually got […]
Dollops of Alpha with Beta
Behold the power of positive thinking. The U.S. economy moved steadily forward with revived animal spirits in the first quarter. That provided the Fed the ammunition to raise short-term rates by 25 basis points, with more increases expected in the rest of 2017. In the euro zone, tangible evidence of growth and inflation emerged, while […]
The Hedge Fund Edge: Still Sharp or Too Dull?
View PDF Why should investors bother with hedge funds? The original proposition behind them was their promise of differentiated performance: better risk-adjusted returns with a lower correlation to traditional capital markets. However, recent history suggests that the current generation of hedge funds lacks the edge of its predecessors. Do hedge funds still have an inherent […]
Book Review: Black Edge
Book Review of Black Edge: Inside Information, Dirty Money, and the Quest to Bring Down the Most Wanted Man on Wall Street, by Sheelah Kolhatkar In the spirit of Den of Thieves, James B. Stewart’s classic book about the insider trading scandal of the 1980s, Sheelah Kolhatkar has written a very readable account of the Justice […]