Funds Hub
Money managers under the microscope
Steer clear of the free lunch, says Noster
Diversification is meant to be the only free lunch in investing.
But according to hedge fund Noster Capital, with most markets looking toppy and with problems ahead, it’s not necessarily one that investors would be wise to tuck into.
“This is not the time to be invested in broad ETFs or in very diversified funds, because the indexes will likely not do much in aggregate,” it says in its end of year letter.
“We feel that most asset classes are currently approaching untenable levels, and while they could certainly grow dearer for some time to come, in most cases we have long passed the level where investors are being adequately remunerated for the risks they are taking.”
Markets are likely to be range-bound for the next 3-5 years, meaning that just buying and holding stocks might not be the best approach, says Noster.
The hedge fund barbell
The fledgling market for hedge fund secondaries may be becoming barbell-shaped, according to Hedgebay.
The firm, which provides a market for those wishing to buy and sell illiquid hedge fund stakes, said there is growing evidence that trades are happening either at very high or at very low prices.
Improving situation at RAB Special Sits
Encouraging news today from RAB Special Situations after the listed fund (a feeder into the main hedge fund) reported a 10.5 percent NAV rise in May.
While this is behind the index return, it nevertheless marks a welcome boost for a fund that has reflected many of the hedge fund industry’s recent problems.
Going global
Global macro and managed futures (CTAs) are still where it’s at, it seems, when it comes to funds of hedge funds.
Nigel Davies’ poll of portfolio managers shows these are the two strategies they are expecting above average returns from in the first half of 2009.
