Hedge Funds and the “Buy Stuff That Has Gone Up a Lot And Cross Fingers” Strategy

Did you really think I was going to leave you for the weekend to plough through

a

thousand words on LSS-backed ABCP backstops? I’m nicer than that. Instead,

enjoy my

man Baruch:

If scurrilous gossip is true, and it normally is, I do not think things have

got much better for the Quants, some of whom apparently decided to replace

their moribund mean reversion strategies after August with factor-based, directional

strategies which relied excessively on momentum — this is technically

known as the “Buy Stuff That Has Gone Up a Lot And Cross Fingers”

Strategy.

There’s more where that came from: go read the whole thing. And happy belated

Thanksgiving.

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