Year to date, Equities have seen $231 billion in inflows vs. a mere $16 billion inflows into Bonds funds. The S&P500 has averaged +25% so far this year and the Eurostoxx +20%; can you really blame the investors for piling in? With indices up this much, there has been no need to perform individual stock analysis, go through balance sheets, or pay higher management fees to invest in hedge funds that have underperformed against their...
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Hamlet (Take Two): To invest, or not to invest, that is the question?
Commodity Hedge Funds performance has been disastrous recently and assets under management continue to decline. The average fund lost 0.8% in Q1’13 and lost 3.7% in 2012 – the biggest decline in more than a decade. In 2011 they lost 1.4% (typical gains had been 20-40% per year in 2000 – 2008). What I find ironical is that for the first time Commodities are behaving like an “independent” asset class and providing diversification...
What Do Commodities and Edvard Munch Have In Common?
Maybe when Edvard Munch painted “The Scream,” he had the Commodity Investors expression in mind. Commodity stocks have fallen relentlessly over the past month despite numerous sell side houses trying to justify their NAV’s and DCF valuations. There is no such thing as “Value” where these stocks are concerned. Their “value” is determined by what commodity price you input into your model to generate your earnings. You get that wrong...
