Hedgehogging ebook

Ghosts and Earthbound Spirits. The ghosts Linda Williamson writes about in this book are not misty phantoms. She prefers to call them earthbound spirits, because that is just what they are - ordinary men and women who, instead of passing into the spirit world when they died, have remained trapped and bound to this. Earthbound Spirits. Hopefully this book will give you a better understanding about death or at least a thought about the possibility of life after death, to just think that maybe our loved ones are still around us, always close by.

And to help you not to give up on faith or hope. The most comprehensive guide on postgraduate grants and professional funding globally. For thirty-four years it has been the leading source for up-to-date information on the availability of, and eligibility for, postgraduate and professional awards. Each entry is verified by its awarding body and all information is updated annually. Rare is the opportunity to chat with a legendary financial figure and hear the unvarnished truth about what really goes on behind the scenes.

So you end up playing carefully and not hitting balls close to the lines. Each time I played him, I resolved it would be the last, but he would press me to play again. As I said, I definitely knew I should beat Richard, but the cheating and the byplay were so unnerving, and my mind was so bent that the fourth time we played, he won, which further enraged me, especially since he immediately told the other guys about it as if it were the usual thing.

Richard finally went a shenanigan too far with the Triangle group. One night a couple of years ago, he told an intriguing story about a company that had secretly developed a weight-loss drug with no side effects that really worked.

He rattled off the names of compounds nobody had ever heard of. You took a pill twice a day, and presto, in a month you had lost 10 pounds! Obviously, such a drug would be an absolute blockbuster with obese Americans!

He told us he had seen the results of the blind tests, and he cited data from the Stanford Research Group and the AMA. A number of the guys knew of the company, which was a legitimate biotech with some real scientists but a flabby balance sheet. It had announced it was working on a weight-loss drug that was promising, but the biotech analysts, of course, were skeptical.

Guys were intrigued by the story. When they work, biotech stocks can be moon shots. Richard was asked a lot of tough questions, and he handled them well. I told you he was a smart, savvy guy. Do what you want. The next day, some of the guys put in buy orders and were a little surprised when they got filled quickly and in size.

Apparently, the drug did cause rats to lose weight, but it also gave them inoperable, incurable stomach cancer, resulting in death. The stock price instantly collapsed. I was at the next meeting, which Richard did not attend. At dinner, one of the guys, John, told how he had been suspicious when his order got filled in a flash, so he had checked who the big seller was.

It was the broker Richard always used! The members looked at each other the way I suppose the apocryphal Western posse looked at each other when they finally figured out who was the cattle thief. Richard squirmed and said he had sold only a little stock to lighten his position. Get out of here, you piece of crap, said John quietly, and Richard did.

Anyway, after dinner last night, some of us sat around and gossiped about hedge funds. The members of the Triangle, opinionated veterans of the investment wars, are not shy about expressing their opinions, and we all have known each other for years.

The insults flew like shrapnel on a bad day in Baghdad. A long-only manager sourly said something along the lines of the following: The golden age for hedge funds is about over, and it will end with a bang, not a whimper. The larger capital and the bigger talent pool now being deployed by hedge funds mean that the pricing of everything from asset classes to individual securities is under intense scrutiny by manic investors, who stare at screens all day, have massive databases, and swing large amounts of money with lightning speed.

This has the effect of bidding up the prices and reducing the returns of all mispriced investments. Obvious anomalies now disappear, almost instantly. In effect, the alpha available for capture by hedge funds has to be spread over more funds with bigger money, resulting in lower returns on invested capital for hedge funds as an asset class.

Risks will also rise as hedge funds have to take larger, more concentrated positions. You greedy hogs are in the process of killing your own golden goose. The golden goose was plumper and sturdier than you think. Global macro is headed for a bust, another guy said, looking at me. Too much rookie money. You had better make it quick. I just stared at him. There must be a couple of hundred new macro hedge funds formed in the last six months by guys who think they are the next Stan Druckenmiller or Lewis Bacon.

Some of these guys are so green, they can confuse you with their stupidity, and they are big and clumsy, so they can hurt you if you bump into them. And then, stumbling around are the proprietary trading desks of all the big investment banks, plus various rogue central banks like Bank Negara and the Nigerians.

Last week, I got crunched between an Asian central bank and some rookie hedge fund guy who panicked on his first macro trip.

The guy, despite his alleged bruises, looked tanned and rested, so I ignored him. Everybody is on steroids. The violence level is soaring. As more and more funds are unable to earn sufficient excess returns to justify their fees, another guy said, the love affair with hedge funds is bound to cool. But not before all that excess capital takes its toll on the performance record and exalted reputations of the big stars.

The alpha pool of the whole hedge fund industry is not growing, but the number of guys trying to drink from it is. Ask not for whom the bell tolls; it tolls for thee. As all these new, naive, trigger-happy crazies, long on aspiration and short on experience, enter the business, a lot of them will get creamed.

Then their losses will expand the alpha pool for the rest of us. I noticed one of the veterans was looking at me kind of funny, as though he was thinking, Who are you, punk, to go talking about naive talent? Actually, since LTCM with its huge balance sheet and various forms of tail optionality whatever that means blew up, hedge funds have been reducing leverage. The clients of the fund of funds are unhappy with the meager returns they are getting, so the fund of funds goes to the bank and borrows.

And the banks, particularly the European ones, are falling all over themselves to offer credit to their wealthy individual clients to leverage up their hedge-fund holdings. Theoretically, it makes sense. A basket of diversified hedge funds has lower volatility than one fund, so why not leverage it up to magnify the returns?

Yeah, said somebody else. It makes sense until a bolt from the blue, a tsunami wave, a two- or even three-standard-deviation event happens, and then the you-know-what hits the fan. What happens to the whole hedge-fund universe then? The frightened fund of funds clients redeem, the fund of funds in return have to redeem from their hedge funds, and the whole asset class does an extreme shrink. Furthermore, there are no safe havens.

The long-short market-neutral funds get killed, too, because when they have forced liquidations, their longs go down and their shorts go up. Meltdown, said the long-only guy, not just for you perps but for everyone else and me too.

The evening was over. As I mentioned before, for every hedge fund rags-to-riches story, there are at least two to three rags-to-rags or rags-to-riches-to-rags tales. In , an estimated 1, funds went out of business. Despite media sensationalism, there are very few spectacular blowups, in which a fund goes down in flames like LTCM or Bayou, but there are a lot of slow, lingering deaths.

Their fee is 1. They have a lot of overhead in space, accounting, computers, back office, and technology. Then they have three analysts and a trader to pay salaries to, plus hard dollars to fork out for Bloomberg terminals and research services.

Unless the partners have some money to begin with, they have nothing to live on. The rest of the horde are just dreaming of a hot streak that makes them viable. I personally know of a dozen funds that were started in the past few years by very successful analysts or savvy institutional salespeople.

They were the golden children of the great bull market, and they made a lot of commission money in the late s, which they spent with luxurious abandon. They are attractive guys and gals not many gals, as a matter of fact , but to some extent, they confused charm, a low handicap, and a bull market with investment brains. Flushed with success, they embraced a voluptuous lifestyle that included everything from wine cellars to jet time-shares.

Take the case of three successful guys from private wealth management at Goldman Sachs, who a couple of years ago formed a market-neutral long- short equities fund.

They had been big winners at Goldman. One had a real nose for tech stocks, another was particularly good at trading IPOs. Brokers are a little grubby. So these guys aspired to run a market-neutral hedge fund and be stock pickers.

Were they investors or asset gatherers at Goldman Sachs? Mostly the latter, I suspect. Sorry, but I think market neutral is a tough racket, particularly quantitative market neutral. There are too many people doing the same thing. In the s, Morgan Stanley had a series of market-neutral funds that were run off different fundamental and quantitative models.

All had boy geniuses at the controls who had made big money on the trading desk or had built a model that worked great on paper when they were dummy back-tested. In live action, none ever produced with real money. One allegedly used a computer to take stock selection to the third derivative and fifth dimension in color.

There was color all right. Then one of the three partners, the one with the big house in Rye and all the nannies, quit and went back to Goldman in private wealth management. The trouble was all his accounts had been reassigned and he had to start all over again. The other two hunkered down. They let go of their two analysts, pared back on overhead, and transitioned their children to the Greenwich public school system.

But as their investors heard about the departures and confidence that the firm was holding together began to dwindle, they were slowly but steadily bleeding assets. Another somewhat similar case was Ian. I wrote this six months ago, so bear that in mind as you read this little essay and the addendum. For two years, my two partners and I shared office space with Ian, a brave companion from our Morgan Stanley days. Ian is in his late 30s and is a lean, ascetic-looking guy with a shaved head.

He is very bright and analytical. He talks fast and passionately, and all four of us have been good friends for a long time. I think I know Ian well. He is the quintessential, hard-core, investment true believer. A man searching at all costs for the truth of his profession.

Ian put together a fabulous record in emerging markets. We regarded him as a young superstar, and as drew to a close, I pressed very hard to get him paid big money because he was crucial for the business, because he had so much potential, and because I knew he was restless. At the end of , for the first time, Ian received a huge bonus, part in cash and part in deferred. Open navigation menu. Close suggestions Search Search. User Settings. Skip carousel.

Carousel Previous. Carousel Next. What is Scribd?