Pension Funds Ditch Hedge Funds
A loyal reader of HedgeFundBlogger.com pointed out this article below to me last week. It discusses how pension funds have been burned by hedge funds are now backing away from them. I interpret the situation differently, I believe hedge funds have outperformed many other types of investments and just about everyone in the world has lately had a strategic allocation to cash or cash equivalents...I think that hedge funds will regain their assets and strength over the next year years and pension funds will remain invested within this space. They are in need of more diverse strategies from managers with aligned interests, not less. Here is an excerpt from the article mentioned above:
From New York to California, public pension funds staked billions in good times on the highest of Wall Street high rollers: hedge fund managers and corporate buyout specialists.
But for many of these pension funds — and the millions of people who are relying on them for their retirements — that gamble is not paying off as hoped.
Even before state and federal regulators began investigating whether several prominent investment firms had made improper payments to gain business from New York’s state pension fund, public pension funds were backing away. These private investments were supposed to outpace the stock market but, in many cases, lost value instead. source
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