When hedge funds closed on Monday, it came as no surprise to those who follow their performance.
But how much will the latest round of closures impact your portfolio?
Gamestop, which closed on Wednesday, was one of the last of its kind, taking a $40 million hit after the chain’s share price collapsed in the wake of the Paris attacks.
But, just how much could you lose if you were to close your hedge fund this week?
Gametopia closed on Thursday, taking down about $40.5 million.
The hedge fund was one that was one big winner in the global financial crisis and its share price plummeted in the weeks after the attacks.
The firm said it had already lost about $10 million in the last 24 hours.
It also announced it was buying another hedge fund.
“It’s not going to make any difference in my portfolio,” said a portfolio manager who wished to remain anonymous.
He said he expected it would have a significant impact on the market, which is a big concern for investors. “
I am not going into it to sell the hedge fund because the company has done well over the last five years.”
He said he expected it would have a significant impact on the market, which is a big concern for investors.
“Investors have been looking for a stable, predictable and cost effective way to manage their portfolios,” the portfolio manager said.
“The last hedge fund that closed was the first hedge fund to go out of business in the US.”
He added that the latest closing could also be a sign that investors have become more cautious about investing in these types of funds.
“You may not have had a hedge fund close last week, but I would imagine that the number of hedge funds that have closed in Australia will be significantly lower this year.”
The fund manager said investors could have a better shot at picking up a hedge once they close their funds, if they buy into a fund that offers higher yields.
But he warned that there was a downside risk.
“There is a risk that if you do get a large payout from a hedge that you will not be able to use the money in the fund in the future,” he said.
Topics:stockmarket,market-and-economics,financial-market,government-and_politics,economy,foreign-affairs,australia,france,aussiesFirst posted April 02, 2020 12:51:05Contact Josh MacdonaldMore stories from Western Australia