A hedge fund manager whose clients demand monthly performance reports has different needs than any individual investors with a 20-year time horizon. The needs of that long-term investor differ markedly from someone who is retiring in three years.
Despite all the media coverage, glitz and glam of hedge funds, they have not done well for their investors. They have high - some say excessively high - fees; their short- and long-term performance has been poor.
Many hedge fund managers have become billionaires; perhaps this - plus their reputations as the smartest guys in the room - is why they have captured the investing public's imagination.
Hedge funds are not especially liquid. Many are 'gated' - meaning there are only small windows when you can withdraw your money. They typically have a high minimum investment and often require investors keep their money in the fund for at least one year.
Some persons think that they have to look like a hedgehog to be pious.
Everybody in Hollywood has to beat the 'no' - and if you write code in Silicon Valley, or if you design cars in Detroit, if you manage hedge funds in Lower Manhattan, you also have to learn to beat the 'no.'
I live in New York and got a call from my agent saying there was this new role on 'Mad Men,' it might be recurring and they're seeing people tomorrow. I said, 'OK, this is one of those things where you hedge your bets, use your miles and get on a plane.' I flew out Tuesday morning and got the job on a Wednesday.
In 2008, people who invested in hedge funds needed capital badly, but many of the funds would not return their money. However, I gave money back to any investor who requested it. It was the bottom of the market and a pretty tough time.
In general, the hedge funds were clobbered by the 1969 bear market, ending up in many cases with records that were worse than those put together by aggressive mutual funds denied the luxury of short sales.
I'm an inveterate fox and not a hedgehog, so I always think you should try everything.
