Main Street Not Ready For Hedge Fund Model ('s Losses) - Dealbreaker

Main Street Not Ready For Hedge Fund Model ('s Losses)

"Liquid alternative" mutual funds bit the big one in 2015.

So, you see, down really is up.

Liquid alternative funds a.k.a. hedge-like mutual funds a.k.a. retail hedge funds have done a great job of mimicking the real thing this year. By which we mean they lost money hand over fist. Now, the sophisticated investor expects this kind of thing. Indeed, if the inflows are to be believed, they positively welcome it. But those schlubs on Main Street? They just don’t know a great opportunity when they see one.

More “liquid alternative” mutual funds closed in 2015 than in any year on record, according to research firm Morningstar Inc., as inflows dwindled and performance weakened….

Assets in liquid-alternative funds grew to $310.33 billion at the end of 2014 from $124.44 billion at the end of 2010. But the inflows have slowed as performance faltered this year.

The Year the Hedge-Fund Model Stalled on Main Street [WSJ]
Hedge Funds Struggle With Steep Losses and High Expectations [DealBook]