Sat, May 30, 2015
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Other Voices: Roadmap to absolute returns, part 1

Monday, October 28, 2013

amb
Rene Levesque
By: Rene Levesque, Founder, Mountjoy Capital

"Past Performance Is No Guarantee Of Future Results" The studies are well documented on the fact that manager selection based on trailing performance metrics is a losing proposition. Chasing return profiles ultimately results in disappointments for the investor. New research now suggests a mean-reversion theory: outperforming and underperforming fund managers across the world showed the idea of mean reversion to be factually correct, suggesting that strong periods of outperformance can be followed by less attractive results, and that frequently strong periods of underperformance can be followed by improved returns.

Qualitative versus Quantitative

Quantitative tools do in fact help in building a case to justify manager selection decisions with evidence of hard data under the scrutiny of the investment committee members. Quote: "A judicious man uses statistics, not to get knowledge, but to save himself from having ignorance foisted upon him." (Thomas Carlyle) The process has evolved into a culture that imposes quantitative filters on a discipline better referred to as an art rather than a science. Plainly, the justification process has somehow drifted as the core of the evaluation and decision-making process; while the two being two very distinct activities.

The problem is acutely applicable in the evaluation and selection of abs......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Opalesque Exclusive: New TMT hedge fund adopts the long-term approach[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: Adam Parker founded Center Lake Capital LLC in New York in November 2014. Before that, he was portfolio manager at Point State Capital (the successor fund to Dr

  2. Regulatory - Hedge funds face tax as Iceland poised to end capital controls, Comment: Why alternatives need more transparency, not enforcement[more]

    Hedge funds face tax as Iceland poised to end capital controls From Bloomberg.com: Hedge funds and other investors who bought claims against Icelandís failed banks face a tax that targets the lendersí estates as the government prepares to unveil its plan for exiting capital controls in t

  3. Investing - Nelson Peltzís Trian Fund Management reduces position in Legg Mason, Biotech investors up big amid bubble talk, Hedge funds increase exposure in healthcare[more]

    Nelson Peltzís Trian Fund Management reduces position in Legg Mason From Octafinance.com: Trian Fund Management has filled a SC 13D/A form regarding Legg Mason, Inc. Per Nelson Peltzís Trian Fund Managementís filing, the filler reported decreased stake in the company by -11.05% to 11,03

  4. All hedge fund strategies rebounded last week as market conditions normalize[more]

    Komfie Manalo, Opalesque Asia: After a difficult start this month, all hedge fund strategies ended last week in positive territory, as the Lyxor Hedge Fund Index gained 0.9% (-0.2% MTD, 3.3% YTD). According to Lyxor AMís latest Weekly Briefing, in t

  5. Billionaire hedge fund investor Odey says April 'bloody', has cut risk[more]

    From Reuters/Yahoo.com: Billionaire hedge fund manager Crispin Odey has cut risk and leverage following a stunning 19.3 percent loss in his 3.1 billion euros (2 billion pounds) Odey European Inc fund in April, a letter to investors seen by Reuters showed. Describing the month as "bloody", Odey

 

banner