With all the negative publicity concerning Hedge Funds lately, I wonder why anyone would even want a part of these investments. A decent Investment Advisor will often offer investment products that are totally transparent (unlike Hedge Funds), no incentive fees, and great return potential.
Hedge funds have a significant failure rate. Some strategies, such as had an attrition rate as high as 15% per year between 1994 and 2003, according to a study. It cannot be denied that failure is an understandable part of the process speculative financial investments, but when large, popular funds close, there is a lesson for investors somewhere in the debacle. When you see Hedge Fund returns in the Wall Street Journal, or other financial publications, they omit the funds that have gone out of business. This, of course, inflates the actual investment return of these funds.
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14 years ago
1 comment:
Would have to agree, my RIA Advisor has managed programs that act like Hedge Funds but they use mutual funds, ETFs and is only 1.5% / year.
WHo needs the hassle of hedge funds?
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