New macro hedge funds optimistic
It was big news this summer when Moore Capital Management founder Louis Bacon decided to return $2 billion to limited partners.
The decision was grounded in the notion that macro hedge funds will struggle mightily going forward. The conventional wisdom now is central banks responding to crises drive the markets, and little else. This means that macro funds will struggle.
I'm not sure I buy the premise. In any case, the hedge fund industry right now is not completely bereft of optimism. There's a new crop of fund managers who are coming up, bent on proving that this is in fact a great time to be a macro fund manager.
Institutional Investor takes a look at some of these managers, noting that they don't all agree on how to conquer the massive challenges that have proven insurmountable for the likes of Bacon.
In some ways, this is classic hedge fund hubris. They wouldn't be in the macro business if they didn't think they could ride world economic trends to great gains. If you are going to be in macro funds, these are the kind of guys that you'll want to go with. But realistically, there's plenty of reason to be skeptical that anyone will emerge as the next Soros. Plenty of new funds will fare well, for a year or maybe two or three.
From a long-term perspective, it takes a special manager to post big (or any gains) year after year after year. But you've got to love the confidence.
- here's the article
More macro funds might consider retuning funds