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To: TobagoJack who wrote (5474)	7/2/2001 1:37:26 PM
From: Hawkmoon	Read Replies (1) \| Respond to of 74559

While I like the ideal of hedge funds being available to pension funds (certainly preferable over "Long only" mutual funds), these funds will have to have just a bit more transparency. There is just too much temptation to take this fresh source of cash flow and throw it into questionable trades just because of the "use or lose" mentality. And when derivatives are involved, that could create far more turbulence than many pension funds can handle. But it's only natural that pensions should migrate to hedge funds since the mutuals are so restricted as to the kinds of trades they can take. I think it is unfair, and I see no reason why a normal mutual fund should be prohibited from undertaking hedging strategies like covered calls and puts to protect the NAV of their shareholder's gains. This places them at a natural disadvantage to the other hedge funds who have more flexibility and trading options. Pension money going to the hedge funds over the mutuals is the first (second?) nail in the coffin of the entire mutual fund industry. Managed money accounts will be the way to go over the next couple of decades. Hawk