Alpha Strategies

What a Hedge Fund Failure Looks Like

Apr 13th, 2014 | Filed under: Alpha Strategies, Hedge Fund Industry Trends, Hedge Fund Strategies, Today's Post

By Jeff Malec, CAIA CEO, Founding Partner Attain Capital Management, LLC The Twittersphere couldn’t get enough of the news last week that hedge fund legend Paul Tudor Jones was shutting down one of his eponymous funds, the Tudor Tensor Fund (try saying Tudor Tensor 10 times fast). And critics of hedge funds will jump to the [...]


The Mania of Boom & Bust

Apr 2nd, 2014 | Filed under: Alpha Hunters, Alpha Strategies, Book review, Today's Post

Vikas Shah interviews Dr. Bob Swarup, CAIA, founder of Camdor Global and author of Money Mania: Booms, Panics and Busts from Ancient Rome to the Great Meltdown.


The Yin and Yang of Executive Compensation

Apr 1st, 2014 | Filed under: Alpha Strategies, Best Practices, Regulatory, Today's Post

The lesson for investors in the new Wachtell Lipton document may simply be that a corporation that is careless about compensation at the highest level, that cannot carefully document the reasons for payouts, is asking for trouble and that one must consider whether the market has fully discounted the trouble.


Baseball and the Stock Market

Mar 31st, 2014 | Filed under: Alpha Hunters, Alpha Strategies, Today's Post

Spring and the opening of the baseball season bring fresh hope, so we thought it only appropriate to look at the U.S. stock market and its relationship to baseball with guest columnist Thomas Schneeweis.


Quantifying Alpha for Private Equity: Four Approaches

Mar 30th, 2014 | Filed under: Alpha Strategies, CAPM / Alpha Theory, Private Equity, Today's Post, Venture capital

I admire a new "direct alpha" approach to measuring the success of PE portfolios. So will anyone who has had to tell a friend or loved one, "just come out and ask me please!"


European ETFs: Innovations the Key to Growth

Mar 27th, 2014 | Filed under: Academic Research, Alpha Strategies, Alternative Beta & Hedge Fund Replication, ETFs, Infrastructure, Today's Post

The way to keep growing is to keep changing. For the European ETF market, that means product innovation, from infrastructure funds to smart beta.


Is Global Macro en Vogue for 2014?

Feb 20th, 2014 | Filed under: Alpha Strategies, Hedge Fund Industry Trends, Hedge Fund Strategies, Today's Post

Global macro was the strategy of choice for many of the big managers early in their careers. Big-name brands including Soros, Tudor and Moore saw the value of the strategy in the 1990s. This oft-misunderstood strategy is returning to the forefront. Diane Harrison looks at why.


Prediction: The Word ‘Alternatives’ Will Go Out of Use

Feb 13th, 2014 | Filed under: Alpha Strategies, ETFs, Portable Alpha & Alpha/Beta Separation, Today's Post

The separation of alpha and beta is becoming a matter of routine, and the result will (PwC suggests) eliminate the division between "alternatives" investing on the one hand and "traditional" investing on the other.


Deloitte to Hedge Funds: Emulate the Agility of a Skier

Feb 10th, 2014 | Filed under: Alpha Strategies, Alternative Mutual Funds, Hedge Fund Industry Trends, Hedge Fund Strategies, Institutional Investing, Performance, Analytics & Metrics, Risk management, Today's Post

Deloitte's pie graphs emphasize the degree to which both hedge funds and PE vehicles have become dependent upon institutions in general, and detached from the retail market. But Deloitte says that 2014 "will likely see additional efforts by alternative fund managers to engage the retail investor base by taking their alternative investment strategies mainstream."


Two Troubled Strategies by the Numbers

Feb 9th, 2014 | Filed under: Alpha Strategies, Commodities, CTA, Hedge Fund Industry Trends, Hedge Fund Strategies, Today's Post

Managed futures are performing quite poorly. They also have a higher standard deviation than the HF industry aggregate, so it seems that if you're invested there your losses are at least buying you greater risk. [Wait. That can't be right.]


North American Distressed Debt: Review and Prospect

Feb 5th, 2014 | Filed under: Alpha Strategies, Hedge Fund Industry Trends, Hedge Fund Strategies, Today's Post

A new white paper from Debtwire and Bingham McCutchen finds some reason to be bullish about the distressed debt market in 2014. The long-awaited tapering of the Federal Reserve's easy-money policy may set off a wave of defaults, creating opportunities for the wary.


M&A World: Stacks of Corporate Cash Looking for Deals

Feb 4th, 2014 | Filed under: Alpha Strategies, Seeding/early-stage, Today's Post

Corporations have cash in the till; and it is sitting up, begging to be put to work. Thus, M&A deals are on the way.


What Will Drive ETF Growth? Not Active Management

Feb 3rd, 2014 | Filed under: Alpha Strategies, ETFs, Today's Post

Pimco is expanding its active ETF offerings significantly. By serendipity, The Cerulli Edge contains some fascinating data on the growth of the ETF industry. both active and passive.


Managers and Skill: Japan, India, and the Arab World

Feb 2nd, 2014 | Filed under: Alpha Hunters, Alpha Seekers, Alpha Strategies, Emerging markets, Today's Post

A new report from GFIA highlights some asset manager successes: in the Japanese markets riding the wave of Abenomics; in India benefitting from the weakness of the rupee; and in the Arab world thriving against the backdrop of political turmoil.


Hedge Fund Replication: A Practitioner’s Scorecard

Jan 30th, 2014 | Filed under: Academic Research, Alpha Hunters, Alpha Seekers, Alpha Strategies, Alternative Beta & Hedge Fund Replication, Hedge Fund Operations and Risk Management, Hedge Fund Strategies, Today's Post

Andrew Beer looks at hedge fund replication to see if it works.


NCSE Data: Endowments Sticking with the Endowment Model

Jan 29th, 2014 | Filed under: Alpha Strategies, Endowments & Foundations, Institutional Investing, Today's Post

Higher-education endowments are sticking with the “endowment model,” that is, their asset allocations remain stable. For example, in 2012, the surveyed institutions had 15% of their total AUM in domestic equities, 16% in international equities. In 2013, those figures were only slightly higher, 16% and 18% respectively.


Really Fast Information Processors or Tippees?

Jan 27th, 2014 | Filed under: Academic Research, Algorithmic and high-frequency trading, Alpha Strategies, Regulatory, Today's Post

A forthcoming paper by Goldstein et al opens a window onto the convergence of two market-structure issues that, until quite recently, had not even been thought very similar.


Women Running a Marathon Toward Alternatives

Jan 26th, 2014 | Filed under: Alpha Hunters, Alpha Seekers, Alpha Strategies, Hedge Fund Industry Trends, Institutional Investing, Today's Post

The latest in a series of annual reports from Rothstein Kass on women in the alternatives world adopts a somewhat less cheery tone than did that of last year. No longer is the dominant metaphor a "tipping point." Now it's a marathon.


The Haves and Have Nots of Today’s Markets

Jan 23rd, 2014 | Filed under: Alpha Hunters, Alpha Strategies, Today's Post

Diane Harrison looks at what 2014 may hold for the markets. What pain in exchange for the gain may lie ahead?


Commonfund: Looking in a Rear View Mirror for Driving Lessons

Jan 20th, 2014 | Filed under: Alpha Strategies, Private Equity, Today's Post, Venture capital

The crucial generalization to be drawn from the last three decades of alternatives investing by institutions is that generalization is tricky. Even within one type of structure, such as VCs, broad statements have to take account of the wide dispersion in returns, "making manager access and selection key determinants of success."


It’s Always Relative…That Is, In Performance

Jan 9th, 2014 | Filed under: Alpha Strategies, Hedge Fund Industry Trends, Performance, Analytics & Metrics, Today's Post

Guest columnist Diane Harrison considers performance. What's the alternative?


10 Top Hedge Fund Industry Trends for 2014

Jan 6th, 2014 | Filed under: Alpha Seekers, Alpha Strategies, Hedge Fund Industry Trends, Hedge Fund Strategies, High-net-worth investors, Institutional Investing, Today's Post

Guest columnist Don Steinbrugge provides his thoughts on what the coming year will bring for hedge funds.


Top Five Alpha Stories of 2013

Dec 30th, 2013 | Filed under: Alpha Hunters, Alpha Strategies, Today's Post

In the interests of full disclosure I acknowledge here that I recently entered the realm of bitcoin owners myself. That said, bitcoin is a fascinating story, one of our top five of the past year.


Getting Past the ‘Taper Tiger’

Dec 15th, 2013 | Filed under: Alpha Strategies, Hedge Fund Industry Trends, Today's Post

Guest columnist Diane Harrison on taming the taper tiger.


The Cayman Islands’ New Fund Governance System

Dec 12th, 2013 | Filed under: Alpha Strategies, Hedge Fund Industry Trends, Hedge Fund Regulation, Today's Post

Ogier Partner Peter Cockhill recently examined the direction in which the Cayman Islands regulator CIMA is headed on fund governance. He thinks the costs of the new framework, though real, will prove reasonable given the benefits.


Mapping Investor Behavior

Nov 21st, 2013 | Filed under: Alpha Strategies, Behavioral finance, Institutional Investing, Retail Investing, Risk management, Today's Post

Guest columnists from Tesseract Asset Management look at investor behavior and risk management.


CSAM: The Elephant’s Gonna Have to Leave

Nov 20th, 2013 | Filed under: Alpha Strategies, Currencies, Today's Post

The good news is that there is a general consensus that QE-infinity is not sustainable. "The notion that QE has distortionary effects is widely accepted," says the CSAM white paper.


Fee reduction and alpha generation: Why fee reduction is the purest form of alpha

Nov 14th, 2013 | Filed under: Alpha Strategies, Hedge Fund Industry Trends, Investment Management Fees, Today's Post

Guest columnist Andrew Beer looks at fee reduction as an "alpha generator."


Cyprus: The Land That Money Forgot

Oct 30th, 2013 | Filed under: Alpha Strategies, Emerging markets, Today's Post

Guest columnist Doug Friedenberg turns over a few rocks in Cyprus and finds that there might still be something left.


Institutional Market to Increase By 30%: How to Play That

Oct 20th, 2013 | Filed under: Alpha Strategies, Institutional Investing, Today's Post

The hedge portion of a liability-driven portfolio can be dominated by long-duration fixed income instruments. One of the points of a new Cerulli report is that by offering those, asset managers can get a valuable 'in' with the sponsors of DB plans, to whom LDI appeals.


Can Strategic Volatility Help Family Offices?

Oct 15th, 2013 | Filed under: Alpha Seekers, Alpha Strategies, High-net-worth investors, Today's Post

Guest columnist Don Dale looks at


The Conundrum: Market Risk and The Fed Executive Summary

Oct 10th, 2013 | Filed under: Alpha Seekers, Alpha Strategies, Timely Research, Today's Post

Guest columnist Tesseract looks at the second half of 2013 and asks the question "Where are we headed?"


Clear Correlations Getting Blurry: News From Foundations

Oct 3rd, 2013 | Filed under: Alpha Seekers, Alpha Strategies, Institutional Investing, Private Equity, Today's Post

Comparing the 2011 and 2012 data, some correlations that seemed clear in the former year either disappeared entirely, or become a good deal blurrier, in the 2012 data.


Beyond Becalmed Swensen: The Next Generation Model

Sep 30th, 2013 | Filed under: Alpha Strategies, Institutional Investing, Today's Post

The David Swensen inspired "Endowment Model" came under heavy criticism in 2009-10. More recently, opinion has mellowed, and now comes a project, the Portfolio Whiteboard Project, in which the participants view Swensen in a spirit as collegial as it is critical.


Alternative to an Alternative: Active Microcap Vs. Private Equity Part Two

Sep 26th, 2013 | Filed under: Alpha Seekers, Alpha Strategies, Private Equity, Today's Post

In part two of two, Perritt Capital Management looks at active microcap as an alternative to private equity. Part one published Sept. 25 on AllAboutAlpha.com


U.S. debt stand-off: the next crisis?

Sep 23rd, 2013 | Filed under: Alpha Strategies, Today's Post

Guest columnist Shane Brett looks at the U.S. debt crisis.


The Mellowing of Debate over Private Equity

Sep 18th, 2013 | Filed under: Alpha Strategies, Book review, Private Equity, Today's Post

In early 2011, Jason Kelly, a Bloomberg News reporter, decided that he had to write this book to explain to the general public how PE works. That sort of epiphany makes it a little surprising that there isn't more of an over-arching theme in the book that resulted.


Another Look at the Chemicals Industry and Merger Activity

Sep 8th, 2013 | Filed under: Alpha Strategies, Asset pricing, Today's Post

Christopher Faille contemplates a newly listed blank check company looking to acquire a specialty chemicals concern, and he asks an expert what exactly "specialty" chemicals are. "And while I have you on the line...."


The Decline and [Possible] Reinvigoration of Labor Unions

Sep 1st, 2013 | Filed under: Alpha Strategies, Letters to the Editor, Today's Post

The U.S. marks Labor Day, and we at AllAboutAlpha consider the lessons that unions and others might learn about collective bargaining from a successful negotiating tactic employed by two actors in the infant television industry of 1951.


PrevInvest on EM Funds and the Cycles of Hype

Aug 29th, 2013 | Filed under: Alpha Strategies, Emerging markets, Today's Post

The BRICs as a group have been a disappointment to those who thought they were at a take-off point at the turn of the millennium. In the cycles of investment-market hype, BRICs have been replaced by CIVETS. PrevInvest offers words of caution.


Alpha Hunter James Rickards on Gold and the U.S. Dollar

Aug 20th, 2013 | Filed under: Alpha Seekers, Alpha Strategies, Commodities, Currencies, Gold, Hard metals, Today's Post

Christopher Faille talks to James Rickards about U.S.-Russia relations, as Russia reaches parity with the U.S. in the gold-to-GDP ratio.


Chemical Industry M&A Experiments Fizzle

Aug 11th, 2013 | Filed under: Alpha Strategies, Private Equity, Today's Post

Companies in the chemicals industry end up in play as mergers-and-acquisitions targets when they have trouble getting financing any other way. If QE policy makes financing too easy, it has the counter-intuitive effect of freezing this particular M&A market.


Moving Into the 40 Act Space: An Offer of Assistance

Aug 8th, 2013 | Filed under: Alpha Seekers, Alpha Strategies, Alternative Mutual Funds, Hedge Fund Industry Trends, Investment Management Fees, Retail Investing, Today's Post

Citi Prime's report has in mind specifically the situation of hedge fund firms that are interested in expanding into the public-offerings space. They have to keep in mind that they'll have a completely different investing audience from that of the QIPs and institutions to which they are accustomed.


PrevInvest on The Taper and the Summer Lull

Jul 30th, 2013 | Filed under: Alpha Strategies, Commodities, Currencies, Hedge Fund Industry Trends, Today's Post

The key to an equity hedge strategy in the U.S. at present is that “the basket of those stocks generating healthy profits becomes clearer to differentiate from those that are having trouble doing so” through the earnings season. PrevInvest is moderately bullish on this, but not bullish on an event-driven strategy.


Axioma on those Low-Vol Picnic Baskets

Jul 25th, 2013 | Filed under: Alpha Strategies, CAPM / Alpha Theory, Indexes, Today's Post

The success of low-volatility strategies has been noted in the literature at least since the mid-1970s, with the publication of a seminal work by Haugen and Heins. And such strategies continue to prove successful today. Why do they still work? Why don't the excess profits draw in the bears, consuming all the picnic baskets, driving profit levels down to normal?


Alternative Entrepreneurs Generating Alpha

Jul 18th, 2013 | Filed under: Alpha Seekers, Alpha Strategies, Today's Post

Guest columnist Andrew Cohan explores the challenges in today's alpha hunt.


Better Portfolio Management through Music Appreciation

Jul 16th, 2013 | Filed under: Alpha Strategies, Today's Post

Guest columnist Doug Friedenberg looks at alpha with a musical perspective.


Tolstoy, Happy Families and Asian Managerial Success

Jul 8th, 2013 | Filed under: Alpha Seekers, Alpha Strategies, Emerging markets, Hedge Fund Industry Trends, Hedge Fund Strategies, Today's Post

Asset managers within the Asian boutique universe keep telling GFIA that "asset raising is hard" in the present climate. It isn't going to become easy any time soon, but there is a new level of stability.


A Third Wave of Alt-Industry Growth is Upon Us

Jun 30th, 2013 | Filed under: Alpha Strategies, Alternative Mutual Funds, Hedge Fund Industry Trends, Retail Investing, Today's Post

Private fund managers who want to be part of this wave, who hope to compete for the retail investment market with their absolute-return and non-correlation toolkit, shouldn’t think it is going to be easy. One of the sections of the SEI report is headed “understanding the hurdles.”


Barclays: Growth Strategies as an Industry Matures

Jun 27th, 2013 | Filed under: Alpha Strategies, Hedge Fund Industry Trends, Hedge Fund Strategies, Today's Post

On of the key points of the new report from Barclays, Making It Big, is that there are four broad business strategies that define hedge fund managers: product specialists (PS); asset class specialists (ACS); multi-strategy managers (MSM); and diversified alternative asset managers (DAAM). This classification has implications for growth.