Poor hedge fund managers are going to need to ease up on the construction of their mega mansions, if this keeps up.
AIG has had enough and won’t take the losses anymore. They’re pulling $5.5 billion or so from their hedge fund investments, rightfully so.
AIG had about $11 billion dedicated to hedge funds as of the third quarter, and returns on the holdings have slumped in recent months. Chief Executive Officer Peter Hancock said at a Jan. 26 investor presentation that the company intends to lower the allocation, but he didn’t say how many hedge fund managers the company would stick with or provide details on the planned amount of exits.
“We had a very negative experience in hedge funds,” Hancock said in the presentation. Shifting the allocations will “lead to a much better return on risk and especially return on capital.”
The company has investments in 100 funds. They’re selling in order to preparing for increased volatility and want to reduce “risk assets” in financial markets, as a period of limited liquidity might be around the bend.If you enjoy the content at iBankCoin, please follow us on Twitter
i’ll never invest in a hedge fund again. 75% of investment went up in smoke in 6 months. I was better off dumping it into the GARP index, or equally spreading to a half dozen OA picks.
Hedge funds are absurd. They can pursue pretty much any ill advised strategy without significant personal consequences. After collecting 2 and 20 for years, when the fund blows up, often because of “pennies in front of a moving steamroller” strategies, they can liquidate the fund, pass the losses to the investors, and retire. Or start another fund.
The 2 and 20 is the first clue something is wrong.
exactly. this fuck head blew up a fund inside a year, and now he’s back at it with a “relaunched” website that is producing an average return of 17% a month. I feel bad for anyone who gets scammed now buying a membership. Absolute asshole.
Hilarious. “Shifting the allocations will ‘lead to a much better… return on capital.” That should have been apparent some years ago.
Oil is tanking hard. Probably by $20 at the end of Feb.
Gosh, it sure was smart of us taxpayers to bail out AIG, wasn’t it?
markets in turmoil can’t have a proper pending st. valentine’s day massacre since it’s on a Sunday this year
OH NO 1850 AGAIN. seriously screwing up my 1770 plan.
DAX at support again. That’s all. I’m outta here.