There was a day in age when hedge funds were respected for their stock picking talent. They found ways to access information that they layman could not even dream of accessing. It was a world filled with serious people out to make some serious money. All of that has changed, especially with the Fintech revolution that has evened the playing field for the average Joe, sputtering around in his Toyota Camry, trying to grow his nest egg.
I am dead serious about this.
The tools and sites and people sharing ideas online have truly empowered people to the point that paying attention to the once cherished 13-f filings, by some of our most prestigious hedge funds, is pretty much a non-event. Some of the new positions of mega-titans, like Buffett or Tepper, will always draw interest and perhaps lift the shares for a day or two. But, for the most part, people don’t give a shit what Tiger Global or Viking are buying and selling anymore.
Agree or disagree?
The industry is so maligned by years of underperformance and chicanery that betting against them is often a better strategy than betting with them. Additionally, so many of them have become so big in size, they’re all stuck buying the same stocks. There’s so much money sloshing around in search of performance that the very performance desired can only be found in outlier years, black swan events, or much smaller funds.
This is why Buffett thinks hedge funds are idiotic, especially when compared to buying an index fund like SPY and reinvesting the dividends. The fact that the SPY beats upwards of 70% of hedge funds is absurd and comedic. The only thing the industry is good for, apparently, is convincing people to send them money.
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Hey Bulls, question,
Rail traffic?
That’s the full question, Bye bulls
gibberish
rails, buffett, berkshire, dinosaur
Speak fucking English already. I’m getting real tired of reading your half sentence bullshit.
Compile it and earn yourself some shekels for your pie crust dinner
I have 1/3rd of my $$$ in high grade munis (A or better, usually AA). I have another 1/3rd in SPY or other broad market ETFs. Then I have 1/3rd in individual stocks, most of which I’ve held over 2 years. Being a retired curmudgeon, when my stocks go up I trim some and buy SPY or munis, whichever is down the most. The SPY is usually the outperforming part of my portfolio.
Interesting. Thanks for sharing your method of investment, Zheeeeeeeeeeeeeeeeeeeeem.
Gartman update: in terms of dollars, structure and whatnot, Gartman sees oil and gold higher than today’s price come next month. If a gun was to his head, he would hedge by selling copper (I’m not sure in what denomination). Anyone trade $DRIP?
*Higher prices a month hence.
If you look at the dispersion of returns, stock picking is pretty near impossible now, unless you have non public info. Its back to assets allocation and being in the right place and adaptive to what the market is doing. it should now be “desperately seeking alpha”
Disagree. Stock picking has never been easier as long as you have a longer time horizon of at least over 2-3 years. The awesome part about today market is that everyone is trying to impose technical analysis which causes a lot of price distortions and thereby causes a lot of money making opportunities in both directions.
Perhaps so. What kinds of stocks or sectors are you thinking are easy?
Good question frog. I remember way easier stock picking times, where you could just throw blindfolded darts and buy. There may be a good point being made on the ta front here.
I haven’t seen excessive selling that causes bargains out there just yet this year. However, every year, there is always one occasion in which I just could go long and make 20-35% gain off one buying spree. Valuation has come down a little bit, but it hasn’t gotten to the reasonable to dirt cheap range yet. I have the biotech sector in mind right now just because I’m a physician who knows what I’m doing. However, I always buy stocks run by innovators. Right now, the two most promising innovators are Zuckerberg and Musk. Regular financial analysis doesn’t happen for these guys bc they own the cheap code to the world of finance. I was very bearish on TSLA with the belief of Saudi Arabia trying to destroy the alternative energy movement. However, after witnessing how emptiness of their threats, I’m looking to buy TSLA $180 or below.
I mean cheat code.
+1
1) Select a stock
2) Look at industry vs macroeconomics
3) Look at past income growth
3) Estimate future income
4) Evaluate company’s ability to make basic payments (particularly on their debt)
Go short/long or wait (don’t buy/seel agaisnt the trend).
Time frame is key, with the knowledge that undervalued stocks may remain undervalued until a strong bull market, and high-flyers may continue to float until a bear market. The corrections are often swift.
Stock screeners often help no narrow down your candidates.
+1 to timeframe; I don’t beleive geniuses deserve infinite PE ratios, just higher ones
you cant do it in size. also very few active managers outperform market consistently in recent years.
do you have access to SPIVA reports. It will shed a lot of light on the situation.
Good stuff trumpmeister. Thanks!