Money managers under the microscope
The hedge fund circuit can be exhausting.
Last Thursday saw the plush fundraising dinner of ARK, the charity headed by Arpad Busson, fiance of Uma Thurman, at London’s Waterloo International.
The next date in the European hedge fund industry’s diary is next week’s annual GAIM conference, held in Monaco (where else?).
From June 16th-18th top executives and managers will be gathered in the principality to discuss the outlook for the industry, which delivered record poor performance last year and which has seen waves of investor outflows.
The packed programme shows the industry is coming to terms with the new conditions in which it is operating.
Some investors may not be fully aware of the risks they face as career-conscious hedge fund managers plump for strategies that build a convincing-looking track record but occasionally backfire badly.
According to a paper by Yale academic Hongjun Yan, hedge fund managers are far more likely to choose so-called ‘nickel’ strategies than ‘black swan’ strategies, even if returns are ultimately lower and they risk the occasional huge loss.