Convertible arbitrage has been one of the best performing hedge fund strategies year to date in 2009, up 17.9% while the HFRI general index has gained 4%. Recall, however, that convertible bond arbitrage was one of the worst performing strategies in 2008 losing 33% while the HFRI general index lost 19%. The losses came from [...]

Should not a capitalist system punish as well as reward? We saw the devastation left by Lehman when it filed and concluded that some banks are too big or too interconnected to fail. But we had a sample size of 1. Are we sure that no other banks should be allowed to fail? An un-named [...]

Star Date 2009 05 19:
 
 
Hedge funds have been accused of missing the equity market rally begun March 2009. Let us look at an example of an equity market such as the European equity markets to see why.
 
Equity markets are up year to date. The Stoxx 600 for example is up some 6% year to [...]

 
 
Efficiency is all about being marginally inefficient.

Hedge fund investors are gluttons for punishment. So says the economist in their May 14, 2009 article where they claim:

That hedge funds spectacularly failed to achieve the absolute returns that were supposed to justify their high fees. 
That hedge funds ran liquidity mismatches between the assets in their portfolios and their volatile funding and investor terms. 
That [...]

In the interest of full disclosure, First Avenue Partners of which I am a partner, runs a hedge fund seeding and incubation business. I generally don’t talk my own book and I don’t intend to start now, but I will speak generally about the industry without specific reference to what we do. So please read [...]

Its going to be harder to make money.
Equity and credit markets bounced and rallied hard in March. This has improved sentiment all round. Market commentators everywhere are split between those who see this as a bear market rally and those who say that the worst is over and that we have the beginnings of [...]

It seems that equity markets have confounded the pundits. Here is an article written by a good friend of mine who works as a stock broker in Singapore. He turns his commentary specifically to the Singapore equity market, but it might be applicable to any market.
 
Case for Start of Bull Market Rally

Everyone already knows [...]

My colleague Oliver Bergmann who heads up our hedge fund incubation business and I were discussing how the world of credit spiralled so quickly out of control. He sent me the following article by David Merkel who writes a very interesting blog called The Aleph Blog (www.alephblog.com). David had analysed this anecdotally and very insightfully [...]