How Do You Define Risky?
A while back I was interviewed by reporter Kambiz Foroohar for an article he was working on. I will go back and check my notes for more detail, but I remember telling him that if Christopher Cox and the SEC were ok with mutual funds selling NASDAQ index funds, which we all remember dropping -77% during the last market bubble pop, then the idea that average investors should be turned away from hedge fund opportunities (with track records that don’t come close to -77%) by the GOVERNMENT was contradictory and frankly bogus. I also implored this reporter to address the word “risky” - what in the world does it mean in the government’s eyes? I still don’t know.
The government can’t on one hand sanction mutual fund strategies that we already know can go down to zero, but then turn around and keep people away from hedge fund opportunities that have actually assembled track records of note and make money. That doesn’t even address the issue of the average Joe having his pension monies put into hedge funds anyway - just without his knowledge by the institutional manager who controls his retirement future.
Here is the article in question where my comments did not make the final cut. The article features Christian Baha of Superfund.
