Skip to comments.Hedge funds try to hold back redemption wave
Posted on 11/29/2008 4:24:52 AM PST by TigerLikesRooster
Hedge funds try to hold back redemption wave
Tensions rise as some managers try to lock up investors' money for longer
By Alistair Barr, MarketWatch
Last update: 12:39 p.m. EST Nov. 28, 2008SAN FRANCISCO (MarketWatch) -- Hundreds of hedge funds will shut this year as an estimated wave of as much as $700 billion in investor redemptions crashes over the industry, but some managers are trying to hold back the tsunami.
At least 75 hedge fund firms, including GLG Partners (GLG) , Deephaven Capital Management, RAB Capital (UK:RAB: news, chart, profile) and New Star Asset Management, have put up "gates," suspended redemptions or unveiled a restructuring this year.
Preventing lots of investors withdrawing their money at once helps avoid selling assets at fire-sale prices and potentially relieves short-term market pressure. However, the trend is also raising tension between hedge fund investors, who may need cash quickly, and managers, who may be more interested in holding on to assets to protect their businesses.
(Excerpt) Read more at marketwatch.com ...
Is this thing goes badly, I’ll be happy a Republican isn’t POTUS. :)
Why don’t Democrats pass the middle income tax cuts now? Bush would sign it. And they need to lower Cooperate tax rates, 35% is too much to do business, and at least matching McCain’s 25% would improve the economic environment, real genuine solutions rather than short term ‘bail-outs’ and ‘stimulus bills’
I have already heard from 2 people that they are getting stalled on getting funds that are theirs.
Don’t know if they are Hedge funds or not, but they want their 401’s and they are getting a tap dance.
Die hedge funds die. They can’t implode soon enough.
Though the Wall St anarchists bear more responsibility for the derivatives mess. The 8 trillion dollar bailout may be bogus but most of it is an effort to contain the credit default swap and derivatives mess. Not so much the sub-prime mess
You would think for $800 billion we could at least get a new deck of cards from witch we could rebuild or economy with? We certainly are not going to get a currency with any real value.
Some of us at work looked into getting our 401k money too. We were willing to pay the penalties but the Company said that we couldn't touch unless we were 55 years old or left the company. (quit, retire, etc)
So although the money in the 401k is “ours” we are not allowed to get at it. But of course more “donations” are acceptable.
Frankly I am beginning to understand the people who say get “it” now because you probably won't be able to later.
Question. Answer. They don't want Bush getting even a little credit for anything.
It depends. If you left the company and your money is still in their 401k, you need to roll it over into an IRA. Then the money is yours to do with as you wish. If you’re still employed by the company, and the 401k is sponsored by them, then the French have a saying for your situation - “A so ell” (Say it slowly out loud with a French accent).
I can truly say that life is a learning experience. I am 53 now and I am learning everyday. The latest thing of course is also the oldest thing I learned. When playing a game learn all the rules, because when somebody changes them in mid-game you can challenge them about it.
Of course with the government, (Federal, State, Local), the rules change so fast that you never can keep up.
It reminds my of Ayn Rand's Atlas Shrugged. When there are so many laws against so many things, you will break at least one of them every day. It's easier to keep the populace under control that way.
Which witch do you wish?
Can you borrow against it?
I run a (very small) “hedge fund.” All it means is that I will go long as well as short, will use options as well as futures, and state in my initial interview with clients “don’t give me your money if you aren’t prepared to lose 50% of it, or ALL of it if everything goes south at once.” If the fund loses 50%, I liquidate it and send them a check. I have been down almost 30% at one time, but never a forced liquidation. It is also on the rules that you can’t get your money back unless it is the Jan 1, and you have to notify me by Sep 15. Your losses are yours. Your gains are 30% mine. I make no moneys from funds under management. I also don’t take money from people I don’t know.
I am down 7% this year, after being up by over 46% before the PM collapse. I have been short banking stocks since March, and shorted the living pooh out of WAMU, Citi, and Fannie Mae.
I have only had two customers want their money out, but it was mid October, and I told them they would have to wait until next year, (I don’t want to establish precedents).
I think I am good at what I do. I expect to close out the year with my clients in the black, although minimally so.
Your company’s response to those who want 401 K redemptions NOW is not unusual. It is the norm. I would not give it to you, either, not just because I want to be a jerk, but because you can’t run a fund that way, with people jerking money out every time someone rings a panic bell.
I dont know any more. I'm so confused. :)
The usual "Santa rally may be rather muted this year.
Your hedge fund is OK and honestly run. But I curse the big ones for running up commodities and oil the last few years. Yeah I know there all kinds of hedge funds. I get a kick out of that nerdy looking Paulson whose hedge fund bet and won spectacularly betting against the health of sub prime mortgages. I guess he bet against securitized mortgages
I am down 7% this year, after being up by over 46% before the PM collapse......
It’s been nice since those jackasses have been out of the oil market.