Cryptocurrencies are not suitable in investment portfolios because of unstable returns and volatility, and low correlation between various cryptocurrencies.
A number of my posts over the years have highlighted evidence that manager selection does not add value to the portfolio process. (See "Manager Selection is a Hail Mary Pass"). This holds true for investment consultants, hedge fund of funds, among others. This latest study finds the same holds for pension fund consultants.
ShapeShift cryptocurrency platform has started asking customers for personal information in what will be an increasing trend for firms to conform to a version of know-your-customer rules. This would be an important step in increasing the legitimacy and assets of cryptocurrency. Enhanced transparency for cryptocurrencies is also a high priority for government regulators in getting comfortable with the market.
Is a 1993 and 1998-type debt crisis coming? For those of us who lived through the previous debt crisis see some critical similarities to today's conditions: shrinking risk spreads; increased leverage, especially in emerging countries and China; potential dramatic political mayhem; an increase of concern about the level of debt. In previous cases, the key to the crisis was a global turn towards risk avoidance. So far, this has not been onerous. But the risk is certrainly there.
A longstanding problem for hedge funds has been the limited number of companies that have sufficient amount of publicly traded stock to accommodate the appetite of hedge funds with billions of dollars to invest. The result is "herding" where many large hedge funds end up with similar positions: i.e., a concentration of assets in a small number of stocks. Additionally, these stocks make up a significant component of the S&P 500 which causes the heavily exposed hedge funds to show performance that mimics the S&P 500 as well as each other.
Facebook stock decline hits hedge funds hard
Hedge fund titan, Steve Cohen, known as the ultimate "stock picker," i.d. make trades based on fundamental analysis, is predicting that quantitative models using massive databases, will dominate trading, as well as other sectors.
SEC continues to reject Bitcoin ETF proposals because the proposals are not consistent with the Exchange Act Section 6(b)(5) and its requirement that a national securities exchange's rules "be designed to prevent fraudulent and manipulative acts and practices." https://www.coindesk.com/sec-rejects-7-bitcoin-etf-proposals/
Steve Wozniak, co-founder of Apple with Steve Jobs, recently announced his participation in a crypto startup. During the interview, Mr. Wozniak (Wo...
Ezra Zask has been actively managing, consulting, teaching, advising, writing and speaking on hedge fund and investment management issues for over three decades.