20% above cash guaranteed: Would you invest?

[Trembling Hand]

Just purely as hypothetical (nick off ASIC I'm not raising funds without a lic or prospectus)

If a hedge fund offered you 20% return above Australian cash rate annually would you invest in that fund? Even if they were making 60% returns or greater.

Would you feel cheated if you were only getting 30% of the profits? If your return was 20% but no more or no less.

 

[prawn_86]

Re: 20% above cash guaranteed. Would you invest?

I can assure you this would be very popular, you know my stance TH.

I would personally invest in a flash, providing the guarantee was solid. Compound 20% and i would reach my financial goals no worries.

 

[skyQuake]

Re: 20% above cash guaranteed. Would you invest?

Where do I sign?

I guess it would depend on the offerer's creditworthiness, whether I have claims over the issuer's property and chattels , how airtight the contract is, and what fees would be charged.

Most important would be how much I can put in. Doubt you can do that with 100mil under management TH

 

[gooner]

Just purely as hypothetical (nick off ASIC I'm not raising funds without a lic or prospectus)

If a hedge fund offered you 20% return above Australian cash rate annually would you invest in that fund? Even if they were making 60% returns or greater.

Would you feel cheated if you were only getting 30% of the profits? If your return was 20% but no more or no less.

Yes if it was guaranteed and the guarantor was someone like WBC.

But if it is just someone saying, "I aim to make 20% for you", and they are making 60%, then they are probably putting your money at high risk to get 60% and so would not invest.

Very Very few hedge funds make that sort of money. Mathews Capital did via heavy investing in oil futures and shares. But this is high risk - you get on the wrong side of the leveraged positions and capital disappears quickly

 

[shiftyphil]

If it was really guaranteed, then absolutely.

 

[Trembling Hand]

About the guarantee (hypothetical of course)

Obviously it wouldn't be a CBA & WBC doing it!!

It would go like this (hypothetical of course )

A long term profitable trader has extra cash sitting in a cash account. He chooses to put that up as security, say 40% of raised funds. So 20% to cover the return & 20% as a drawdown and drop dead level for the fund.

no further guarantee.

 

[gooner]

Slightly off topic, but might be of interest.

Capital guaranteed funds (say a five year one) work by taking your $10,000, investing $9,000 in a bank for five years at a fixed interest rate to give you your $10,000 back. They then invest the other $1,000 in various stuff like futures and equities to enhance the return. So if the fees are 2% pa, you are really paying most of that 2% to invest in cash. Dumbass.

 

[Trembling Hand]

But if it is just someone saying, "I aim to make 20% for you", and they are making 60%, then they are probably putting your money at high risk to get 60% and so would not invest.

I guess thats why you are an Accountant. :

 

[Trembling Hand]

Re: 20% above cash guaranteed. Would you invest?

Most important would be how much I can put in. Doubt you can do that with 100mil under management TH

No you would not be able to do it with that much. But say 2 - 5 mil. Don't want to be too greedy. Would need to leave some $$'s for the corp actions funds

 

[awg]

I would register my interest.

for an amount within my trade and risk management of course

 

[skyQuake]

Re: 20% above cash guaranteed. Would you invest?

No you would not be able to do it with that much. But say 2 - 5 mil. Don't want to be too greedy. Would need to leave some $$'s for the corp actions funds

Will that mean we will see more spoofing on the HSI/SPI?

fwiw, I think the free money from corporate actions is pretty much over though...

 

[Naked shorts]

Jim Simmons charges 5/44%, plenty of people invest in him.

 

[Trembling Hand]

Jim Simmons charges 5/44%, plenty of people invest in him.

Thats irrelevant. I could kick his teeth in with return as a % but wouldn't know what to do with any more than a few bob so that will lead us nowhere.

 

[Mr J]

TH, is this just curiosity or are you thinking of doing something?

I wouldn't take it (since I'm under the illusion I could beat 20%), but I imagine it would be very, very attractive to the majority.

 

[Trembling Hand]

It came up in a thread yesterday. Got me thinking.

I do have a fund setup - of sorts, with OPM.

But due to Australians anti entrepreneur laws this is all just hypothetical of course. :brille:

 

[Ashsaege]

AFS should start up it's own hedge fund using the top traders on this forum

 

[prawn_86]

AFS should start up it's own hedge fund using the top traders on this forum

Imagine the ego clashes

 

[awg]

Just asking

There are plenty of Investment "clubs" or "syndicates" about.

I was involved in a private property development syndicate, and that was set up just with a Solicitors agreement.

made way more than 20%pa

That may neutralise some of the regulations about "financial advice"

I dont know, would be interested to learn more

 

[Naked shorts]

Thats irrelevant. I could kick his teeth in with return as a % but wouldn't know what to do with any more than a few bob so that will lead us nowhere.

Well if investor capital builds to a point where it is harming your returns, just send it out to other high yielding managers. That's what most of the the big multi-strategy funds do (basically turn into FoF's).

p.s. I could guarantee 50%p.a. on your money, capacity $40mm (and that is with me taking 40% performance fee)

 

[Trembling Hand]

Just asking

There are plenty of Investment "clubs" or "syndicates" about.

I was involved in a private property development syndicate, and that was set up just with a Solicitors agreement.

made way more than 20%pa

That may neutralise some of the regulations about "financial advice"

I dont know, would be interested to learn more

Yes all above board if you do not solicit for funds publicly and less than 20 investors and a whole heap of other stuff. As soon as it come out to the general punters then you run into a wall of legislation and compliance.