Tags: Singer | Calpers | hedge | funds

Singer: Calpers Decision to Dump Hedge Funds 'Off-Base'

By    |   Tuesday, 18 November 2014 08:32 PM

It probably won't surprise you much that a star hedge fund manager, Paul Singer, CEO of Elliott Management, disagrees with the September decision of California Public Employees' Retirement System (Calpers) to jettison its hedge fund holdings.

Calpers, the country's largest public pension fund, announced that it was unloading all of its $4 billion in hedge funds, except for corporate activist funds. It acted in response to mediocre returns and high fees. 

"We are certainly not in a position to be opining on the asset class of hedge funds, or on any of the specific funds that were held or rejected by Calpers," Singer wrote in a recent letter to clients obtained by CNBC.

"But we think the decision to abandon hedge funds altogether is off-base."

Singer said Calpers was wrong to reject hedge funds for their complexity. "It is precisely complexity that provides the opportunity for certain managers to generate different patterns of returns than those available from securities, markets and styles that are accessible to anyone and everyone."

Meanwhile, Henry Blodget, editor-in-chief of Business Insider, is none too impressed with the performance of hedge funds. 

"On average, hedge funds are no smarter about picking stocks or other investments than anyone else. In fact, they're decidedly, startlingly worse," he writes on the news service.

"But hedge funds are absolutely brilliant moneymaking opportunities for those who run and work for them," thanks to their high fees.

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It probably won't surprise you much that a star hedge fund manager, Paul Singer, CEO of Elliott Management, disagrees with the September decision of California Public Employees Retirement System (Calpers) to jettison its hedge fund holdings.
Singer, Calpers, hedge, funds
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2014-32-18
Tuesday, 18 November 2014 08:32 PM
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