Hedge Fund Investing Just as Good As Monkeys With Darts
Tiger cub hedge fund Tiger Global’s public-equity business, run by Scott Shleifer and Chase Coleman, ditched its massive bet of more than 17.9 million shares, according to the fund’s most recent 13-F filing. Viking Global, led by billionaire Andreas Halvorsen, reduced its stake in Netflix in the second quarter by 22%, selling just over 1.77 million shares. Viking last held over 6.28 million shares, a position valued at over $575.2 million at the end of the quarter. Full Story
Perfect; most hedge funds do not know what they are doing anyway. Like the masses, they panic when they should be buying, and are euphoric when they should be panicking. That is why they have taken such a beating over the past few years, and that is why more and more will go out of business. Investors are sick of paying these “fat good for nothing” managers to do nothing but make bad judgement calls. For every Hedge fund with a good track record, there are several hundred with terrible track records. Overall, you are better off giving a pair of chimps darts and asking them to throw them at a random list of stocks.
As they are dumping these stocks, it means it is time to take a closer look at them. New businesses are cropping up that will offer the same services for a fraction of the cost; this means the days of hedge funds are numbered as are the days of portfolio managers, analysts, investment bankers, etc.
Hedge Fund days coming to an end?
“Recently, a combination of industry headwinds, a difficult market environment and, importantly, our own disappointing 2016 results have challenged our ability to continue to maintain the scale and scope we believe necessary to pursue our investment program consistent with our founding principles,” Mindich wrote in a letter to investors.
Mindich is not alone. The challenges he has faced are well known to the 9,893 hedge funds left in the $3 trillion industry. Not only were markets choppy in the early months of 2016, but increasingly, investors have begun questioning whether the high fees charged by hedge funds are justified. Research, along with an experiment by legendary investor Warren Buffett, has shown that low-cost stock market index funds have generally outperformed hedge funds.
Eton Park lost 9% in 2016. Not only did Mindich’s returns lag behind the S&P 500—they also underperformed the overall hedge fund industry’s 5.5% return last year, according to Hedge Fund Research. Eton Park’s underperformance also wasn’t contained to just 2016. It beat the S&P 500 just once in the last six years and has been relatively flat in 2017 Full Story
Other steps you can take to improve your investing skills
If you seek freedom, the 1st task is to attain financial freedom so that you can break free the clutches of the top players who seek to enslave you. They want you to run in a circle like a hamster that runs on a spinning wheel; the hamster thinks the faster it runs the further it will go, but sadly it is going nowhere.
We teach how to use Mass psychology to your advantage, how to view disasters as opportunities and how not to let the media manipulate you and direct you towards actions that could be detrimental to your overall well-being. Subscribe to our free newsletter to keep abreast of the latest developments. Change begins now and not tomorrow, for tomorrow never comes. Understand that nothing will change if you don’t alter your perspective and change your mindset. If you cling to the mass mindset, the top players will continue to flee you; the choice is yours; resist and break free or sit down and do nothing.
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