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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: SouthFloridaGuy who wrote (92533)	1/11/2009 7:01:52 PM
From: mishedlo	2 Recommendations Read Replies (1) \| Respond to 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

To: SouthFloridaGuy who wrote (92533)	1/12/2009 2:08:43 PM
From: XBrit	Read Replies (1) \| Respond to of 116555

Henry Blodget has a piece this morning, channeling Shiller about the 10-yr-averaged PE's being at fair value finally. clusterstock.alleyinsider.com Blodget's commentary is about the same as yours was: "So does that mean stocks are going to go straight up from here? Absolutely not. As the last 17 years have shown, the gravitational pull around fair value over the short-term is weak. After past market peaks of this magnitude, prices have usually spent decades below fair value, and we expect we'll likely see the same pattern here. As the accompanying chart shows, however, over the long haul, the reversion around the mean is powerful. And it suggests that, over the next couple of decades, the S&P 500 will deliver an average long-term return (6%-7% real)."