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“What You Got Was The Exact Opposite”: Macro Hedge Funds Join The “Dumb” Money

I swear to God I'm starting to think that before this is all over, index funds are going to be the only damn investment option for anyone that can't trade for themselves. Everyone is acutely aware of the "active" to "passive" shift that's unfolded on a "bigly" scale over the past I don't know how many years and as I documented earlier this week in "Yes, I'll Take Vanilla Please," YTD flows into ETFs have been i) the strongest in the quarter century the industry has been around, and ii) characterized by a conscious choice among investors to favor passive versus active. The latter dynamic was particularly visible in February, as shown in the following table from FactSet: Well needless to say, this is a veritable death knell for the "2 and 20" crowd. If people aren't even willing to pay a slightly (by comparison) higher expense ratio for an actively managed mutual fund or ETF, then you can f*cking forget it when it comes to shelling out for a "rockstar" hedgie whose returns are anything but rockstar-ish. And that goes double (or triple) when benchmarks are just fine in terms of churning out reliable 8% gains. Have a look at this chart and do note the highlight: (Goldman) So
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