chiangmai
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Post by chiangmai on Apr 22, 2019 4:29:51 GMT 7
I'm curious, is there merit to investing in Hedge Fund, Fund of Funds, isn't that just another form of diversification and despite the likely risk level, is it worth exploring?
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AyG
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Post by AyG on Apr 22, 2019 6:37:06 GMT 7
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chiangmai
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Post by chiangmai on Apr 22, 2019 6:52:41 GMT 7
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AyG
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Post by AyG on Apr 22, 2019 10:41:13 GMT 7
To quote Gary Weiss - They [hedge funds] cause people to pay fees that would be considered highway robbery in even the most wack-a-doo mutual fund
- They cause people to buy into "black box" (give me the money, and I do what I want with it, without telling you what I am doing) investment strategies
- They cause people to give their money to creeps they haven't bothered to check out, the kind of people they wouldn't trust to run out and buy them a sandwich, much less manage their investments
- They cause people to sign contracts that are so one-sided they would make a credit-card lawyer blush, including "lock up" clauses that keep their money confined to their funds for as many years as some fund managers should be onfined to prison
- They cause people to agree, sometimes eagerly, to be treated like ... schoolchildren and not be given any information about what is being done with their money
- They cause people to buy investment products that are functionally equivalent to mutual funds, except they over charge you and give you the ability to tell your golf buddies that you've invested in a hedge fund
He concluded "in return, they provide performance that is subpar, inconsistent, not worth all the risk, or all of the above". Incidentally, this is quoted in "The Only Guide to Alternative Investments You'll Ever Need" by Swedroe & Kizer, which is an excellent book that I've read again and again. Highly recommended. I got my copy from Asia Books a few years ago for 650 Baht. Money well spent.
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Post by rgs2001uk on Apr 22, 2019 21:32:12 GMT 7
TOXIC, wouldnt touch them with a bargepole, yours or mine.
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chiangmai
Crazy Mango Extraordinaire
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Post by chiangmai on Apr 23, 2019 6:57:10 GMT 7
Someone tried to get me involved with Mann Group in HK in the early 2000s but after some thought, I declined, my friend, however, went ahead with it. At the time he was getting around 12% and he's still invested with them, his returns have averaged just under 10% per year ever since.
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