Mish's Global Economic Trend Analysis Message Board

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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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To: SouthFloridaGuy who wrote (92533)	1/11/2009 7:01:52 PM
From: mishedlo	2 Recommendations Read Replies (1) of 116555

Funds of hedge funds have enormous fees. Hedge Fund wants 2% upfront +20% of profit. Fund of Fund wants another 2% on top of that typically. The hedge funds in the FoF need to return roughly 5% just to break even (figuring in 20% of profit). In this market that is tough. Plus in a Hedge Fund you have no idea what they are really doing (only what they say they are doing), you may be locked in, assets are pooled, and you are left wondering about statements and stated returns. Contrast to Managed Account Model. We never handle client cash. Statements come from IB, not us. Account is in client name. Nothing is pooled. Client can close the account at any time for any reason with no notice. Clients see every trade we make. I am sure there are managed accounts that operate differently, but not handling cash ever and complete transparency on everything was a conscious decision by Sitka at the very get go. Mish

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