The Investor's Consigliere

Richard Bookstaber on Large Hedge Funds

Hedge fund prophet Richard Bookstaber points out why large hedge funds can't dine out on their great performance when they were small.

Hat Tip: Ken Akoundi, whose Risk DNA daily email is great.

I made a similar point about William Miller here.

Hedge Funds: The Road Back

Eric Jackson of Ironfire Capital makes some interesting points about the future of hedge funds.

Barry Ritholtz: Vast Underinvestment in Manager Selection Due Diligence

Read it here.  Ritholtz claims that at a big investment bank he knows there are under ten people vetting about 250-500 hedge fund and managed account managers on its platform. 

Stay tuned for my manifesto on the future of the manager selection industry.

Pension Funds Reconsidering Alternative Investments

Via the WSJ.

Simon Hopkins of Fortune Group: Lots of Funds of Funds Will Go Out of Business

Via the FT.

The Fund of Funds Industry: Gotrocks into Hadrocks

The FT recalls Warren Buffett's famous bet with the principals of Protege Partners, that a fund of funds portfolio they chose would not outperform the S&P.

The IC (that's me) recalls his famous post on the Berkshire Hurdle.

Bernard Madoff

Via Bloomberg (here too) and elsewhere.  It's not just the size of the con, but also the size and prestige of those who were conned.

Bravo to Jim Vos of Aksia LLC, Harry Markopolos, Brad Alford of Alpha Capital, James Hedges and others, for upholding the good name of investors in investors.

Update--much more here:

The New York Times:  Here and here and here and here and here.

Charles Gasparino

Reuters

The Wall Street Journal

The Financial Times

London's The Times and The Independent

The AP

 

Hedge Fund Makeover Proposal

In the NYT.

BlueBay Blows Up

Via Felix Salmon.

Private Bank Internal Hedge Funds, cont.

Citigroup is closing its ninth internal fund.

And if you don't already hate your private bank, here's the WSJ on how some Asian clients are suing theirs.