That markets rise and fall is one thing we know for sure – the other thing we know for sure is that hedge funds are here to stay. That’s right: The demise of the hedge fund industry has been highly overstated.
New funds are starting up, assets are pouring in and managers are spreading out. And while the champagne is not yet flowing, things are shaping up nicely in the industry in the wake of Dodd-Frank and the aftermath of the credit crisis. All is not well yet– it will take some more time– but my prediction is that 2011 will see a resurgence of the hedge fund industry. The recent news about returns is good and it seems that the public pensions that have been investing in hedge fund for years are quite happy with the returns the managers are delivering. READ THE STORY HERE
That being said, there is still a lot of work to be done. Last week, during the first HEDGEAnswers’ call of the season, we discussed a number of the new rules that directly affect hedge funds. The conversation, while not heated, was quite informative and is worth a listen if you missed it. ORDER THE PODCAST HERE.
The “z” factor, if you will, is the additional findings thatCongress will be studying as part of the Dodd-Frank bill. A number of studies will be launched in the next few months and the findings could severely affect the way the hedge fund industry operates. We aren’t out of the woods yet!
Regardless of what happens with additional legislation and regulation, the hedge fund industry is here to stay. You can bet on it. Nevertheless, it will change and evolve over the next few years and it’s important to stay on top of what’s going on. One way to do so is to take part inHEDGEAnswers.
OK, enough of the shameless plug for my product, on to things that matter: Due diligence is something that needs to be a focus of any investment strategy, policy or plan. Don’t forget that even with the new rules and the new more vigilant SEC, there is still a need for constant, active due diligence. Remember, it’s your money; you need to pay attention to what’s happening with it and make sure that the manager is doing what you hire them to do with your assets. Ask questions and demand answers. If you need help with how to conduct due diligence or questions to ask, get in touch with me.
THINGS THAT DRIVE ME CRAZY
News stories about billionaires’ shoes. The New York Post ran a story this week about New York Mayor Michael Bloomberg’s shoes, or lack thereof. The story said the Mayor, who is worth $18 billion, according to Forbes, only has two pairs of shoes he wears to the office. The Post chose to run with this “exclusive” about his shoes instead of devoting and significant ink about how he is taking away our freedoms. Last week, he proposed banning smoking in parks, beaches and other public places in order to save ourselves from ourselves. The mayor in his infinite wisdom continues to construct a Nanny State and the people don’t seem to care. Where is the outrage – I guess shoes trump freedoms, at least in the eyes of the editors at the Post.