People Have Just About Had Their Fill Of Fake Hedge Funds

"Hedge funds for masses" are losing their appeal.
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Like sugar, leverage tastes really, really, really good.

Or, as the industry likes to call them, hedge-like mutual funds, which are mutual funds that follow hedge-fund-like strategies to the extent allowed them by the law and daily liquidity requirements, which is not a very great extent at all. Even so, they’ve done a pretty good job of matching hedge funds in one regard: trailing the broader markets.

Flows into hedge fund-like mutual funds, a category that attracted almost a third of the money going into actively managed funds in the past six years, have slowed this year to the weakest pace since 2008. The strategies, which include non-traditional bond funds and alternative stock funds, attracted just $1.2 billion from investors in the first five months of 2015, according to Chicago-based Morningstar Inc., down from $39 billion last year and a record $96 billion in 2013….

“Stocks and bonds did so well last year that a lot of people asked themselves: ‘Why do I need to own alternatives?’” said Lawrence Glazer, managing partner at Mayflower Advisors in Boston, where he helps oversee $2 billion.

Hedge Funds for Masses Lose Shine as Goldman, Pimco See Outflows [Bloomberg]

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People Still Launching Hedge Funds Faster Than They Can Fail

Well, the numbers are finally in for 2012 and it was, relatively speaking, a bloodbath for hedge funds, with more going to their grave or down the drain than in 2010 or 2011. But there were still 235 more hedge funds at the end of the year than at its beginning, because those who have previously shuttered a hedge fund due to their failure to raise/make enough money gave it another go last year. Look for more of the same this year, as fresh-faced and not-so-fresh-faced hedge fund managers hang out a new shingle for a few months, only to find out that investors are only interested in having Ray Dalio manage their money.