The Hedge Fund Resource Network your No. 1 source for domestic & offshore fund formation, hedge fund website design, and hedge fund consulting.

Domestic Fund Formation It is a simple process to enter the hedge fund industry; practically anyone with $15k to $20k can start a hedge fund and forming a hedge fund gets easier every year.
Offshore Fund Formation An offshore hedge fund is simply a structure used by hedge fund managers as a way to attract offshore investors (non-U.S. citizens) or U.S. tax-exempt investors such as pension and endowment funds.
Hedge Fund Blog
Hedge fund?
Hedge fund? Despite vastly superior risk-adjusted returns after fees, skill-based strategies continue to be avoided by most. Stocks may eventually go up (or down) but why wait decades to find out? Since this blog began it’s been great dialoging with many interesting people I might never have met. Away from the blogosphere I was busy helping investors make money and reduce risk. Developing portfolio rescue strategies and liability solutions takes time. Fiduciary duty is attempting to preserve client capital. Does long only? It’s better to hedge.Don’t let the beta behemoths...
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Long and short?
Long short? Diversification is “Don’t put all your eggs in one basket”. Instead I assume that some eggs WILL get broken. They always do. Short selling REDUCES portfolio volatility and systemic risk. Long short strategies, not long only assets, are the way to go. In a flight to “safety” investors ought to have more in hedge funds but instead buy low yield “risk free” government bonds! Why do some academics claim the market is rational? Why are they allowed to retain tenure? National bias? Most investors expect the country they live in to have the best...
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Greatest trade ever?
Greatest trade ever? Alpha capture is war and victors don’t take prisoners. What if the Goldman Sachs CDOs, Abacus and Timberwolf, had not blown up? Buyers now called “brilliant” gurus for their perspicacity? GS excoriated for failing to disclose to loser shorts that winning longs had bet against them? Would it have been a case? As ever, the message for investors remains: caveat emptor, caveat venditor, caveat utilitor. Buyers, sellers and users should be grateful to those betting against them. How else can alpha be made?If subprime CDOs had not imploded would Michael Lewis...
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Hedge fund salary?
Hedge fund pay? Hedge funds deliver enormous social and economic value. Pensions fully invested in good hedge funds have better funded liabilities so avoid benefit reductions, raised retirement ages and higher capital contributions. Foundations committed to alternatives have more for worthy causes. Endowments properly allocated to absolute return gain more for students and faculty. Some investors take their chances with “low fee”, high cost unskilled index funds but I don’t gamble. I prefer hedge funds as AFTER FEE returns are so much better.I’m a value investor and...
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Correlation and diversification?
Correlation? Markets moving together? Securities sliding in lockstep? Correlation is a misleading metric of no help in achieving diversification. “Modern” portfolio theory is based on faulty and dangerously simple statistics. Conventional “wisdom” is wrong: highly correlated funds CAN diversify portfolios whereas some “uncorrelated” strategies are too dependent on underlying markets. Correlation is not causation! More importantly diversification has nothing to do with correlation. Below is a hypothetical fund with absolute returns every year and CAGR...
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Risk on risk off?
Risk should always be off with PROPER diversification. Sad to see peoples’ savings and pensions wrecked by the stock market. Again. No returns despite vicious volatility for so many years. An equity risk premium but no performance premium? I invest in skill instead of gambling on asset classes. Why let alpha be crushed by beta? Bear markets and low interest rates don’t impair the ABSOLUTE RETURNS of intelligently constructed portfolios. The future is unknown so robust hedging and multistrategy alpha are essential if you have ABSOLUTE LIABILITIES to fund. Almost everyone does.How...
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Asset classes or skill strategies?
Invest in assets or strategies? The world’s first hedge fund manager Munehisa Homma, invented quantitative investing, event-driven arbitrage and algorithmic trading. Many good hedge funds increased exposure to Japan after the earthquake. Others lost because their “quants” and “risk managers” hadn’t stress tested for an event that was certain to occur. Inevitable unfortunate happenings aren’t black swans. Taking the other side of panic usually works. In 1755 the developer of systematic pattern recognition and candlestick analysis wrote “Buy when...
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Alternative investing?
Are alternatives really alternatives? Most investors’ portfolios are basically funds of funds so the main decision is WHO chooses the managers. You or someone you or your firm appoints. Replacing long only with long short doesn’t help unless skill is evident. People with rare talent go where incentives are highest. Why risk YOUR money on “low cost” index lemmings? The best don’t compete on fees.Forecasting alpha and identifying good funds is complex but not impossible. After intensive due diligence, predictive financial analytics and non-linear multifactor...
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Pension fund apocalypse?
Pension fund? Pensions de-risking by transitioning to 100% quality hedge funds? It’s a fiduciary duty to hire the world’s BEST managers. Why let retirement benefits, income streams and funded status be affected by low interest rates and volatile stocks? There is no need to reduce benefits or raise contributions and retirement ages. Expected stock and bond returns have nothing to do with funding liabilities if you invest prudently. Hedge exposure to low yields. Replace market risk with manager risk. No-one should have to work past age 60 if they don’t want to.There’s no...
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Top hedge fund?
Top hedge fund? Why risk YOUR capital with any portfolio managers not the best in the world at what they do? Warren Buffett runs the largest hedge fund firm and George Soros is the top performing hedge fund manager. They also searched for “successors” only from other hedge funds and, like most prudent investors, allocate their entire liquid wealth to absolute return strategies NOT asset classes. Hedge funds are replacement NOT alternative investments.Top sportspeople play in major leagues not minors. Where do you find the best fund managers? As any coach will confirm, it is...
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