Blog focus: Market Folly

Last Updated on Monday, 1 February 2010 12:53 Written by Sunday, 31 January 2010 09:54

Coverage: hedge funds, macro trends

Platform: blogger

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Market Folly tracks the portfolios of more than 40 major hedge funds.  The author, Jay, was involved with a long/short hedge fund.  Market Folly says it tracks the portfolios on a daily basis, but this probably refers to daily updates of any filings or reports (most hedge funds, if they report holdings at all, do so only on a quarterly basis or if they take more than a 5% stake in a company).

A typical post explains why a hedge fund takes a particular position or adopts a trading strategy.  For example, this post explains why a fund favors physical gold over gold “proxies” like gold ETFs:

“ At the end of 2009, John Burbank’s hedge fund Passport Capital took possession of their physical gold investment. It is kept in custody in Zurich with UBS and represents a 1% allocation in Passport Global. What’s interesting here is that Passport also notes that they intend to increase their exposure via physical gold and that they are unlikely to buy various proxies for gold (i.e. exchange traded fund GLD).

Passport has published a white paper on their rationale for owning physical gold. In it, they examine the supply/demand dynamic, the impact of central bank action on gold, as well as the implications of owning “paper” gold versus physical. This is not the first time we’ve seen specific research published by the firm, as we covered their previous case for agriculture as well.”

Read more: http://www.marketfolly.com/2010/01/passport-capitals-rationale-for-owning.html#ixzz0eEHF9syd