Summer has finally arrived in the north east United States. Cycling to work provides a pleasant reminder that commuting can be enjoyable, accompanied for now by the curious background chorus of billions of buzzing cicadas emerging from their 17 year subterranean slumber. It certainly beats getting on a train. The question of the day is, […]
Yesterday I attended the National Association of Publicly Traded Partnerships’ (NAPTP) annual conference in Stamford, CT. It was well attended as is normal, and it provided a welcome opportunity to see presentations by several of our portfolio names. The long run prospects remain attractive although we’ve had two years’ worth of return in less than […]
Financial markets are not totally devoid of entertainment value. Sometimes a spectacle unfolds that can rivet one’s attention, rather like a movie in which the reckless driver who’s been handling his car aggressively takes one risk too many, causing his shiny sports vehicle to careen off the road and into the valley below. This must have been the expectation […]
The New York Times has a story highlighting what can happen when well-intentioned but financially unsophisticated trustees of a college endowment interact with the wrong kind of financial advisors. It’s a sorry tale of poor portfolio construction and imprudent debt capped off with a Hail Mary type lunge for hedge funds that it was hoped […]
The Economist has an interesting piece in Buttonwood this week about how U.S. public pensions do their accounting. Basically, they discount their liabilities using the expected return on their assets. It results in some curious outcomes. For example, since holding cash typically drags down return expectations, if a pension fund simply gave away its cash […]
My thanks to Ben Chu of The Independent for articulating the case against hedge funds so clearly.
In “Running Low on Bonds”, the WSJ today notes that bond funds are increasingly holding stocks because of the shortage of attractive bonds to buy. They cite the Loomis Sayles Strategic Income fund as an example. Common and preferred equity is now 19% of its portfolio, versus 5% in mid-2011. We’re sympathetic to the argument. […]
Writing covered calls sounds like such an innocuous strategy. You own shares in a company that you like for the long term. Its performance has been modestly positive but fairly unexciting. You don’t want to sell but want to make a little more money out of the investment. So you sell call options to generate […]
We certainly make our share of mistakes, so don’t misread the absence of any gold mining exposure in our client portfolios as bragging. Regular readers of this blog will be aware of the occasional wrong turn. One of the most insightful lessons of Behavioral Finance is the overconfidence many people have in their forecasts of […]
My friend Josh Friedlander, Editor at Absolute Return, has written a very good essay in the Hedge Fund Intelligence Global Review 2013. Unlike most journalists covering the sector who offer uncritical praise of their subjects, Josh asks some very pertinent questions about the future of the hedge fund industry. He’s asking the right questions. Hedge […]
