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After selling PAUDX, I am looking for a replacement and I am looking for a fund that would act somewhat like hedge fund. A global long fund with down protection better than a stock only fund.
Could you please suggest just one fund that is your favorite in this category. A fund that you would invest, if you had to in this category.
Look At JNBSX - JP MORGAN INCOME BUILDER FUND- Holds Stocks And Bonds From Around The Globe. It Can Be Purchased At Fidelity For Small Amounts Of Money, Even Though It Says You Need To Buy A Million Dollars Minimum. The Expense Ratio Is Only .61%. Morningstar Calls It a Conservative Allocation Fund. I Realy Consider It A Global Allocation.
Marketfield (although the original, cheaper shares are no longer available) is really a favorite choice. Pimco EQS Long/Short is another good choice, although I do think that - despite a really terrific year this year - it will probably be at least a somewhat inconsistent performer going forward (the difficulty of a concentrated portfolio + long/short). Whitebox Tactical (WBMRX) is another option. I think all three, despite being long-short funds, are noticeably different in approach.
Third Point Reinsurance (TPRE) and Greenlight RE (GLRE) are two reinsurance companies where the float is invested with the hedge fund (Dan Loeb's Third Point in the first, David Einhorn's Greenlight the second), but Greenlight has moved more with a focus on the reinsurance side than the fund/investment side and I'm guessing Third Point RE (which just IPO'd) will likely be similar. Both are roundabout ways to invest with two of the most notable long/short hedge funds in the industry, but both will likely to continue to trade with the focus on the reinsurance aspect.
I'm also giving some thought to replacing my PAUDX with a similar holding. My concern is how MFLDX, WBMRX and PMHDX will perform during a major downdraft (such as 10/01/07 - 03/09/2009). MFLDX performed well, although not quite as good as PAUDX. WBMRX and PMHDX haven't experienced a major down market. Any ideas about how they might do?
I'm a little reluctant to try PMHDX because it is so new. I've fallen victim to PIMCO's marketing machine before by trying new, but unproven, funds (such as PGMDX), even when run by PIMCO rockstar managers.
My thought on PAUDX is that perhaps the worst is over. Since a number of investors seem to be running for the exits, maybe I'll stay in and see what happens.
I'm in the same boat as you. A couple months ago I sold my stake in PGDPX and looked at where to put that money. I put it in RGHVX. Since purchase, I've been watching it closely and it has actually handled the last couple months market volatility very well.
David has a nice write-up on the fund. A couple of side facts that sold me was that it has very low EUM which I think gives it quick response if needed, and much of the money in the fund belongs to management and their families.
I also cut my PAUIX in half and that money is waiting to be allocated. My two choices right now are to up my stake in FPACX (from 10 to 15%) or after listening to Hank in another post, put it in a tried and true fund - PRWCX.
Reply to @Bitzer: I think WBMRX has an interesting strategy in being long large cap and short small cap. Based on their recent commentary, they are also short apartment REITs. If there is another major crash, these two sectors will definitely get punished and WBMRX should do well in relative (but maybe not absolute) terms.
I'm not buying into this particular fund though. I am still fairly wary of long-short funds because of the high expenses and the fact that so many of them turn out to be mediocre or just plain bad. I do have PAUIX which might technically also be considered "long-short" but has somewhat different goals.
Comments
Third Point Reinsurance (TPRE) and Greenlight RE (GLRE) are two reinsurance companies where the float is invested with the hedge fund (Dan Loeb's Third Point in the first, David Einhorn's Greenlight the second), but Greenlight has moved more with a focus on the reinsurance side than the fund/investment side and I'm guessing Third Point RE (which just IPO'd) will likely be similar. Both are roundabout ways to invest with two of the most notable long/short hedge funds in the industry, but both will likely to continue to trade with the focus on the reinsurance aspect.
I'm a little reluctant to try PMHDX because it is so new. I've fallen victim to PIMCO's marketing machine before by trying new, but unproven, funds (such as PGMDX), even when run by PIMCO rockstar managers.
My thought on PAUDX is that perhaps the worst is over. Since a number of investors seem to be running for the exits, maybe I'll stay in and see what happens.
I agree Bitzer. Just added to my PAUIX
I own PDRMX in my taxable account. I know, I know, I suck, because there is no inflation. Oh well...
David has a nice write-up on the fund. A couple of side facts that sold me was that it has very low EUM which I think gives it quick response if needed, and much of the money in the fund belongs to management and their families.
I also cut my PAUIX in half and that money is waiting to be allocated. My two choices right now are to up my stake in FPACX (from 10 to 15%) or after listening to Hank in another post, put it in a tried and true fund - PRWCX.
I'm not buying into this particular fund though. I am still fairly wary of long-short funds because of the high expenses and the fact that so many of them turn out to be mediocre or just plain bad. I do have PAUIX which might technically also be considered "long-short" but has somewhat different goals.