Many years ago, when hedge funds managed far fewer assets and returns were generally good, they were described as Absolute Return strategies. Perhaps the best industry magazine covering the sector is called AR Magazine. An Absolute Return suggests that it should be positive in most circumstances, which to most people sounds like an attractive proposition. […]
You don’t need a degree in Psychology to know that investors are nervous. Pick up any newspaper, or just take your own pulse. Macro issues dominate almost every investing decision, and it’s therefore not surprising that the safety of bonds remains attractive. No doubt fixed income has had a great run. The Dow Jones Corporate […]
Transocean (RIG), the world’s largest operator of deepwater drilling rigs, has just provided a breathtaking example of how to destroy shareholder value. As I pointed out yesterday, when they bought Aker Drilling in August at a substantial premium they expressed confidence that they could finance the acquisition without diluting shareholders. They reaffirmed this a few […]
Warren Buffett has commented in the past that as an investor you should buy a company so strong that it could be run by an idiot, since someday it will be. The management of Transocean (RIG) is busy providing evidence in support of this rule. Their stock is already reeling from a likely large settlement related to the […]
My book, The Hedge Fund Mirage, will be out in early January. Its one sentence description is that all the money ever invested in hedge funds would have earned a higher return in treasury bills instead. It’s not that there aren’t some great hedge fund managers out there – of course there are. And there […]
As the Euro Crisis Express trundles down the track to the cliff, for those of us old enough to have been trading during the October 1987 Crash, it’s all starting to seem eerily familiar. As was once said, history doesn’t repeat but it rhymes. This time is different in many ways, but what is the […]
Contemplating the unthinkable long ago became a necessary tool for analyzing the euro sovereign debt crisis. Today’s failed Bund auction is another step on the road to Berlin. The 1.98% yield is hardly attractive, and one could quite understand investors avoiding such paltry returns for ten years under most circumstances. But the Euro’s uncertain future […]
One year ago AR Magazine published an article I wrote which revealed how poorly hedge fund investors had done in aggregate. Today, AR revisited the topic. Over the past 12 months the hedge fund industry has continued to deliver steadily mediocre results (although there are certainly some bright spots) and investors have continued to plow […]
Greece has been warned by the troika (EU, ECB, IMF) that personally signed pledges from key political leaders are required before the next tranche of the bailout is released. Greece apparently has enough cash to last 20 days. The threat is that failure to comply will result in Greece being allowed to default. Well, at […]
Barron’s ran an interesting article on places to go for higher income than high-grade bonds. The writer pointed out quite accurately that ten-year treasury bonds do not provide sufficient income to preserve after-tax real purchasing power. The Federal government doesn’t believe its creditors should earn a real return, and has adopted a policy to prevent that. […]
