Insights
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Pivotal Point of View – May 2019
Welcome to The Pivotal Point of View! Starting this month, we are going to provide a monthly snapshot of how the core strategies we track are performing.
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Want to Make Money in the Markets? Try Buying some Weed
Significant outperformance relative to peers, especially in difficult years, can have lasting influence on future fund evaluation and investment decisions. Accordingly, some of these same managers are still catching investors’ attention today. What might be the secret? Cannabis.
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How Important is “Alpha Generation” Really to Hedge Fund Investors?
In early 2019, J.P. Morgan surveyed hedge fund investors to identify their reasons for investing in this space – 88% of respondents cited “alpha generation” as one of the top three motivations. If this is the case for such a high number of investors, it’s important to look at the strategies being pursued in the quest for alpha to see what’s working and what isn’t. We crunched the numbers and found that it’s a good time for a gut check.
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A Junk Rally in Hedge Funds?
What if we told you that one risk factor can explain most of the significant dispersion in returns in the first quarter of 2019? That factor is the Bloomberg US Pure Leverage Portfolio (“Leverage”), a measurement that tracks U.S. companies that are highly indebted, or leveraged. Put another way, it is a measure of quality.
