Hedge fund managers all over the world have been taking hit after hit and accumulating millions in losses with the recent stock market “zig zag”. I wonder why people call them the “smart money”… there is nothing smart about many of their investment positions.
For instance, american hedge fund manager John Paulson have been proving himself to be a one-hit-manager… after his “spot on” 2008 subprime short, his recent investment ideas and performance have been bad wrong bad wrong bad. You can read here for more details: “Paulson Loses 31% in Main Hedge Fund After August Rout“.
In Brazil, we have Dorio Ferman from Opportunity, who is considered one of the best fund managers in the country… again, not sure why they are called the “smart money”. His latest loss shows everything but smarts in it (“Opportunity explica tombo de quase 30% em fundo“). The guy was heavily leveraged in VALE’s stock! Really??? I think it is shocking that someone at his level did not see the train coming:
– Vale’s stock was in its all time high;
– The commodity bull market was showing signs of a top (starting in May 2011)
– The growing iron ore over-capacity issues (that would translate in falling prices)
– China is already slowing down and risks a “hard landing”

I mean, come on, I am a dumb idiot and saw this train coming in June. Read my post here: “TIME TO SHORT VALE?” If anyone read my post, they would have been up 20% in this 2-month period, not bad.

Is it too much to ask your fund manager to realize profits and get out? I guess the “smart money” guys are not that smart after all.  

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