Die stock markets around world had a OKAYJAHR in 2007, but die road until 2008 was contaminated with landmines. The S&P 500 war up approximately 3,6% for the year and the TSX war Yet up approximately 7%th die absolute majority of the traditional products, how were mostly collected mutual funds around their respective indices. I spoke this phenomenon and about die reasons why, in column the last monthly — however die same acceptance over hedge funds cannot be formed Die scatter of return are far broader than with mutual funds: Kw_return the differential between two long/short cheapness managers can as return the differential between be many broader, say, two Canadian cheapness mutual funds. In 2007 war the CSFB Tremont hedge fund index, a value-loaded index, which mostly includes United States and global hedge funds, up 12% for the year. On the surface it compares this very favourably against die world indices and indicates that managers over the spectrum to increase in value in the situation goods. Kw_bit digging a deeper, there were somewhat fantastische profits, like die Paulson credit note opportunities, that up more than 500% on the year war, and die Ci global opportunities, that above over 100% on the year war. The latter is a request Ci the capitals, sold right here in Canada. I know, what you think: “as they, does you it did and why wasn’t I invested in that capital?” In order first part the question to answer, found they to way a toetung of subprime disorders to form and the following credit note crisis into United States. Die Ci capital also closed die right sectors briefly and had a good lump of the shares standing gold in connection, die well did. In order second part the question to answer, war reason, you not in it were invested the human behavior, level and simple People, die too invest in only generally want are which recently well did. Forwards this year war die return Ci of the capitals lacklustre been. It war up 5% 2005 and 0,1 % 2006. Nobody wished die capital; it war too invest many more exciting in, which hot war. If investors had into die briefcase to see geschauen, which the manager did, will they chosen it as good of diversifier briefcase to have. I legend not that it forms capital for my client more over the last couple of years to hold this simply war, but it safe helped to 2007 many more better, than it could have been. It wasn’t all charm for hedge funds into the 2007. Kapitaln, die on markets is based, in order to accomplish in a certain distance, time do may they the 95% to which, war hit strongly in 2007, when ear-basic evaporability and credit markets fell apart. Computer models do not prognosticate this kind of Kw_thing and if you the combine, wrong with a bundle of lever strength, is watch out down. Enough over last year. Well or bad, it is more over. The Rearview mirror, which investing is, is for it health dangerously, which anyway is, fairly like the Kw_driving it car, by looking only in rear view mirror, receives you not far. They may avoid all accidents, die behind you are, but you become without doubt a cause pile UP in the front side, you do not look, where you go. Which strategies look 2008 well? Many marks, but not always, is it die strategies, die die worst implementing in the new past were. That is why die dogs of the Dow theory seems to hold up more over time for stocks. If you are not with it familiar, look it above on the InterNet. It is fascinatingly Die global may macro capital does well 2008, as well as concerned security and somewhat event-dependent strategies. My steady favourite strategy is long/short cheapness, and again I think 2008 gives it some large opportunities. — - Bob Thompson is a participant portfolio manager and a Alternativeinvestment strategist with Capital Canaccord. It and its crew handle hedge fund briefcases for high net value client bob_thompson@canaccord.com
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