Last week Bernard Madoff decided to throw in the towel on his own Ponzi scheme and confess to one of the largest cases of alleged fraud in the hedge fund industry, known to date. The list of direct investors includes astute and reputable investors. The details of the scheme are as yet unknown but the

Closed end funds: Fund structure mitigates investor risk Suitable for arbitrage strategies Suitable for relative value strategies Suitable for distressed and private equity strategies Lends itself to efficient and risk controlled deployment of leverage Technically complex strategies which rely on multiple trade legs Distressed investing: Current cycle is attractive for distressed investing Distressed assets and

An opportunity exists today for a long only buy and hold strategy. The strategy is vulnerable to further mark to market losses but a strategy of investing in CBs from a credit point of view, as opposed to an equity arbitrage point of view yields interesting opportunities. Things could get cheaper next year, and indeed

Commodity prices are overly depressed. See post 27 Nov 2008, A Quick Macro Overview. Buy AUD, sell USD. 

Why is it a bad thing for a central planner to allocate resources in an economy? The Soviet experience is one example. Underlying it is the lack of alignment of interest between principal and agent. If one does not reap the benefits of one’s investment decisions, those decisions are bound to be less than optimal.