5 ms·

That's cool, so US bonds only then?

by zimablue 8y ago

dopamean 8y ago
Don't BR ridiculous. There are lots of mutual funds that don't experience the swings that many hedge funds do.
- iflint 8y ago
  There are many hedge funds with much lower volatility than the average mutual fund. Hedge funds are not inherently more or less risky than mutual funds, they are just actively managed instead of passively managed.
  - wbl 8y ago
    Mutual funds can be actively managed also. Hedge funds are a riskier investment: they are more opaque, can do more exotic things. But pension funds are sophisticated investors and should be able to make intelligent decisions about using them as part of a portfolio.
  - pnutjam 8y ago
    You mispelled "full of fee's that suck out the value."
  - w1nst0nsm1th 8y ago
    It reminds me a story in rare no-nonsense books on stock trading about 90% people losing money or doing less than stock index because of trading fees while activelly managing it. The ability to make good money in stock markets is a rare talent and hedge funds only make hedge fund managers rich, most of the time.
- zimablue 8y ago
  https://www.macrotrends.net/2324/sp-500-historical-chart-data https://www.macrotrends.net/2324/sp-500-historical-chart-dat... Maybe not over (specific) very short periods, but it depends on the mutual and it depends on the hedge fund. If you're saying pension funds should be locked in then you can't invest in anything that has exposure to equities, see: 2008, 1974, 1930. I was just trying to nudge the post I was replying to into realisation that you either accept burning significant money to avoid risk or accept the chance of burning more money. This kind of "pensions should invest in the good guys who don't take risks..." well that's only govt bonds, and one day those will pop also.
pc86 8y ago
I mean a large percentage of the fund should probably be in bonds, shouldn't it? Depending on how many are drawing out vs. paying in.
coughupalung 8y ago
Don't forget mortgage-backed securities.. oh wait. In all seriousness though, large pension plans have very diverse portfolios. Ontario teachers used to own 80% of the Toronto Maple Leafs. Ontario Municipal Employees Retirement System owns Oxford Properties, which owns and manages the office building I work in (and many others). Edit: Added "Employees" to OMERS.
- noer 8y ago
  Major League Sports teams are generally pretty solid investments. Also, the Ontario Teachers didn't just own the Leafs, they owned MLSE which includes the Leafs, Raptors, Argos, Toronto FC, the Marlies plus the arenas at which those teams play. It's not a bad investment to own all but one (they don't own the Jays) pro sports team in a city.
  - coughupalung 8y ago
    Ah right! Thank you for the correction.

That's cool, so US bonds only then?

dopamean 8y ago

Don't BR ridiculous. There are lots of mutual funds that don't experience the swings that many hedge funds do.

iflint 8y ago
There are many hedge funds with much lower volatility than the average mutual fund. Hedge funds are not inherently more or less risky than mutual funds, they are just actively managed instead of passively managed.
- wbl 8y ago
  Mutual funds can be actively managed also. Hedge funds are a riskier investment: they are more opaque, can do more exotic things. But pension funds are sophisticated investors and should be able to make intelligent decisions about using them as part of a portfolio.
- pnutjam 8y ago
  You mispelled "full of fee's that suck out the value."
- w1nst0nsm1th 8y ago
  It reminds me a story in rare no-nonsense books on stock trading about 90% people losing money or doing less than stock index because of trading fees while activelly managing it. The ability to make good money in stock markets is a rare talent and hedge funds only make hedge fund managers rich, most of the time.
zimablue 8y ago
https://www.macrotrends.net/2324/sp-500-historical-chart-data https://www.macrotrends.net/2324/sp-500-historical-chart-dat... Maybe not over (specific) very short periods, but it depends on the mutual and it depends on the hedge fund. If you're saying pension funds should be locked in then you can't invest in anything that has exposure to equities, see: 2008, 1974, 1930. I was just trying to nudge the post I was replying to into realisation that you either accept burning significant money to avoid risk or accept the chance of burning more money. This kind of "pensions should invest in the good guys who don't take risks..." well that's only govt bonds, and one day those will pop also.

pc86 8y ago

I mean a large percentage of the fund should probably be in bonds, shouldn't it? Depending on how many are drawing out vs. paying in.

coughupalung 8y ago

Don't forget mortgage-backed securities.. oh wait. In all seriousness though, large pension plans have very diverse portfolios. Ontario teachers used to own 80% of the Toronto Maple Leafs. Ontario Municipal Employees Retirement System owns Oxford Properties, which owns and manages the office building I work in (and many others). Edit: Added "Employees" to OMERS.

noer 8y ago
Major League Sports teams are generally pretty solid investments. Also, the Ontario Teachers didn't just own the Leafs, they owned MLSE which includes the Leafs, Raptors, Argos, Toronto FC, the Marlies plus the arenas at which those teams play. It's not a bad investment to own all but one (they don't own the Jays) pro sports team in a city.
- coughupalung 8y ago
  Ah right! Thank you for the correction.