Like most people leaving Las Vegas after a few days of fun, hedge fund managers are finding themselves wondering "Who are we anymore?"
But much like piecing together what happened after that platter of complimentary tequila shooters was served up at the roulette table, that is a difficult question. For instance, if everyone hates hedge funds are they bad? Are fees the root of all evil? And where the hell is Bill Ackman?
While Leon Cooperman is clearly annoyed that we're even having this conversation, everyone else at SALT 2016 seemed more than willing to go full late-night dorm room and get existential about what it is to be a hedge fund today.
“Expectations about a hedge fund manager’s way of conducting business has become more demanding — and perhaps rightfully so,” Kenneth Tropin, founder of $12.1 billion Graham Capital Management, said during a panel discussion Wednesday at the Bellagio hotel and casino.
“Every hedge fund manager has had to make the effort to be much more transparent, a much better communicator and more negotiable."
But when does the investor ask those questions? While handing over the 2% or relinquishing rights to the 20%?
After all, what is a hedge fund without its fees?
“Fees have got to come down,” added Kyle Bass, Chief Investment Officer of Hayman Capital Management.
Looks like someone sneaked a little ayahuasca into Kyle's drink. Macro markets are acting crazy lately, and spending a few days inside a Vegas casino can warp a person's mind (especially if you've spent much of that time contemplating/being asked to pay for the reality of President Trump's America) but are hedge funds starting to believe the haters or is it time to make a value trade on hedge fund haterade?
Maybe it's time for hedge funds to look in the mirror and say "We're good enough, we're smart enough, and goshdarn it, people shouldn't hate us."
Carlyle Group's David Rubenstein knows what we're talking about...
Rubenstein suggested an unusual response to a traditionally secretive industry: public relations.
“All of us have an obligation to try to explain ... what the hedge fund industry and the private equity industry does that is useful,” Rubenstein said, noting cash-strapped public pension clients, investments that improve companies, and creating jobs. “We shouldn’t be upset about what we do. We should be proud.”
Maybe Anthony Scaramucci should contemplate a re-branding. "SALT" is cool, but "Hedge Fund Pride Weekend" has a certain something...