Paging Martha

[wildcat]

Martha,

A week or so ago you posted a thread about hedge fund like mutual funds. Funny coincidence but I was waiting for a haircut and reading Smart Money. It had an article about what you wanted and I can link it to you if you have not already decided on a fund. A few funds in the article (one used to be an actual hedge fund for more than a decade) were not mentioned on the thread but my Leuthold Core Investment was in there Just let me know.

 

[Martha]

Still shopping so it would be nice to have the link. Thanks Wildcat.

 

[wildcat]

Sorry couldn't find a link for the mag's article but the list looked like this:

Baron's Partner Fund (according to the mag it returned 17% annual prior to converting from a hedge fund to mf)

James Market Neutral

Legg Mason Opportunity - which can buy stakes in hedge funds and short stocks

Leuthold Core Investment Fund (also offers Bear Fund)

Others I found:
Gateway Fund

Franklin Ultra Short - FUSLX charges a load though

Calamos Market Neutral but it just closed recently to newbies

 

[Martha]

Thanks WC

 

[lazyday]

Article from Forbes: http://www.forbes.com/forbes/2005/0606/126_print.html

(i haven't read it; not too interested in hedge funds myself)

 

[wildcat]

Martha -

My curious nature got the best of me and I wanted to run some correlation comparisons between some of the funds and the S&P, i.e. are they really doing their job of zigging and zagging with the market. I ran 2, one for the life of each fund and another since July '03 (most recent fund start date) to get some sort of benchmark. Granted the 2nd is not a lot of data. However, both can give us a rough idea. I assumed you were looking for a fund that did not correlate with the market and gave you some downside protection when the markets dropped. Anyway here is what I got and it was all in monthly returns starting with the 1st full month of existence as some started middle of the month.

1) Life of the Fund - Leuthold is the oldest
Baron Leuthold James Legg Hussman
0.70 0.59 -0.34 0.83 0.10
2) Since July '03
0.70 0.78 -0.29 0.74 0.73

James was the only one to really zig and zag. Hussman did well for the life of the fund but it too has not been around that long. Others were moderate and you could likely get the same less than positive correlation with a balanced fund. Problem is many of them hold stocks which makes them prone to move with the market despite its ability to sell equities short or participate in other hedge strategies. Other than a pure short or bear fund I don't what else to recommend. Keep in mind the bear funds and the James Market Neutral have very high expenses so you have to ask yourself is the reward worth the expense?