Category Archives: Asset Allocation

Hedge Funds Have Done Well Despite Negative Publicity

One reason some people think hedge funds have not done well since 2009 is because the qualitative easing-induced rally in equities started after a 55% drawdown while hedge funds as a group did not fall that much. Those that do … Continue reading

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Investors In European Stocks Hit By Underperformance

European stocks are underperforming U.S. stocks by about a factor of two since last June despite the hype in financial media last year and a falling U.S. dollar. Below are performance charts and a brief discussion of what went wrong.

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EMH Vindication And Why Diversification Is Placebo Effect

Here is a vindication of EMH as far as longer-term investing based on Dow Jones data since 1915. Statistics indicate that diversification has placebo effect on investors and it is not an effective remedy against market swings due to its … Continue reading

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No Free Lunch In Portfolio Allocation

There is no free lunch in portfolio allocation as any scheme that reduces the impact of adverse market conditions also adversely affects returns in bull markets. Most advisers and clients know this but in hindsight there is always backlash.

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A Survival Guide For The Coming Hedge Fund War

Hedge funds and CTAs have struggled in recent years due to rapid decline in the supply of dumb money. When the current transition period ends and new strategies are fully deployed, only those who are prepared for the coming war … Continue reading

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