Hedge Funds Correction
Scaramucci: Hedge Funds Expecting 5-10% Correction
However, in the long term, Scaramucci says the hedge fund community believes the fundamentals for the S&P remain in tact. He cites all the cash US companies have on the books and management teams that have become impressively more efficient as two examples. "I don’t think we’re looking at a long term train wreck,” he says.
Karen Finerman of Metropolitan Capital sees another positive catalyst. “No hedge funds that I know of are levered up big -- that should mean we’re not going to see forced selling in the market place.”
But don't get all giddy just yet.
I think a worried group of people will sell in the short term,” Scarmucci adds. But over the next 3-4 weeks I think we see the market stabilize.”
And looking at the economy broadly Scaramucci admits that over past 3 weeks more hedge funds have begun to anticipate a double dip recession, however the number is still small -- only 25%.
In other words 3 out of 4 hedge funds are still looking for some growth. ”And for what it’s worth, I don’t think there will be a double dip,” he adds. Source