Tuesday, 30 September 2014
Last updated 14 min ago
Aug 29 2011 | 12:01pm ET
There is no such thing as an absolute return, one of the most influential research firms in the world has claimed.
Chris Douglas, who heads fund research in the Asia-Pacific region for Morningstar Inc., has dismissed the claims of the hedge fund industry as mere marketing. Investors who expect hedge funds to be able to produce positive returns in all market conditions will be disappointed.
"We believe that absolute return is not a categorization," he told Asian Investor. "It is a marketing term."
Douglas said that the explosive growth of absolute return funds—more than 700 have launched in the last two-and-a-half years—reminds him of 1987, a parallel that should worry investors.
"Thinking there was going to be a market correction, a lot of investors ended up on the wrong side and from a capital preservation point of view they lagged a lot of the more fully invested funds that were looking to participate on the upside."
"From a marketing perspective, absolute return is very easy to sell," Douglas added. "It's something that people can really feel more comfortable about investing back into the markets. But, if anything, that's a reason to be wary about investing in these products."
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Sep 30 2014 | 9:29am ET
The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…
High frequency trading is not evil, it is not a conspiracy and it really is not new; it is the natural evolution of the professional trading community making markets, providing liquidity and hopefully...