Newsreel: Who’s writing these headlines?
Feb 11th, 2009 | Filed under: Media Coverage of Hedge Funds, Today's Post
We spend a lot of timing combing through the hedge fund and institutional media. Quite often we find that the headlines on hedge fund stories are somewhat disconnected from the content of the article. Mainstream journalists we know tell us that it’s not uncommon for headline writers to take creative license in an effort to jazz-up an otherwise pedestrian story. Well, the headline writers were out in force this week. We have read several stories whose headlines either misrepresent the facts in the article, mischaracterize the key players, or miss the point of the story entirely. That’s a shame when the journalists have obviously worked hard crafting their stories.
Trimming hedges: In uncharacteristic fashion, The Economist overstates the challenges facing hedge funds and their role in recent market events in this review of an academic study we covered before Christmas. Says the newspaper, hedge funds’ “…economic power has reduced even more…” recently. But with overall assets down less than global equity indexes on a percentage basis, it’s hard to see how hedge fund “economic power” is any different today it was a few short years ago (even accounting for recent lower leverage levels). At that point, magazines like the Economist warned about the excessive influence of hedge funds. (Also…a 5-point deduction for using the “hedge-trimming” analogy yet again.)
European hedgers bleed assets: Investment News headline writers miss the mark somewhat with this report of how European funds of funds (not “hedgers” themselves) are forecast by Reuters to lose 75% of their assets. While single hedge fund managers will surely be impacted, this is a (debatable) conclusion about the fund of funds model, not about hedge funds themselves. More…
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