Why Calpers is Pissed at Hedge Funds

/Why Calpers is Pissed at Hedge Funds

Why Calpers is Pissed at Hedge Funds

By | 2017-08-18T16:52:15+00:00 September 16th, 2014|Uncategorized|5 Comments

Tadas has a nice recap piece on the BIG news that Calpers is sending their hedge fund managers to the scrapyard.

 

 But why so sad Calpers?

Well, the facts don’t lie. Here are the summary statistics for the following indices from 7/1/2004 to 7/31/2014:

  • HFR Global Hedge Fund Index
  • S&P 500 Total Return Index
  • Russell 2000 Total Return Index
  • 10-year Total Return Treasury Bond Index

Hedge funds have been the biggest sucker bet of the past 10 years and Calpers finally got the drift.

hf

The results are hypothetical results and are NOT an indicator of future results and do NOT represent returns that any investor actually attained. Indexes are unmanaged, do not reflect management or trading fees, and one cannot invest directly in an index. Additional information regarding the construction of these results is available upon request.

The invested growth chart:

The results are hypothetical results and are NOT an indicator of future results and do NOT represent returns that any investor actually attained. Indexes are unmanaged, do not reflect management or trading fees, and one cannot invest directly in an index. Additional information regarding the construction of these results is available upon request.

The results are hypothetical results and are NOT an indicator of future results and do NOT represent returns that any investor actually attained. Indexes are unmanaged, do not reflect management or trading fees, and one cannot invest directly in an index. Additional information regarding the construction of these results is available upon request.

 

The evidence above might help explain why Calpers made their all-star cast of overpaid dart throwers jump off a bridge.


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About the Author:

Wes Gray
After serving as a Captain in the United States Marine Corps, Dr. Gray earned a PhD, and worked as a finance professor at Drexel University. Dr. Gray’s interest in bridging the research gap between academia and industry led him to found Alpha Architect, an asset management that delivers affordable active exposures for tax-sensitive investors. Dr. Gray has published four books and a number of academic articles. Wes is a regular contributor to multiple industry outlets, to include the following: Wall Street Journal, Forbes, ETF.com, and the CFA Institute. Dr. Gray earned an MBA and a PhD in finance from the University of Chicago and graduated magna cum laude with a BS from The Wharton School of the University of Pennsylvania.