Why Are Wealthy Families Turning Their Noses on Hedge Funds?

Why Are Wealthy Families Turning Their Noses on Hedge Funds?

Why Are Wealthy Families Turning Their Noses on Hedge Funds?

Many investors look to see what the wealthy are doing when it comes time to get into the stock market. After all, these investors are wealthy because they’ve played the market right. For years, many of the wealthiest investors in the country have hedged their bets on hedge funds. But that is changing. Why? 

These so-called “family offices” made up of the ultra wealthy have been putting a lot less of their money into hedge funds. Instead, they’ve been investing in other things like private equity firms. 

So why the change?

For one, lately, private equity firms have been doing better than hedge funds, and they often charge lower fees. According to the Hedge Fund Research report, 2017 marked the third consecutive year that “family offices” have lowered their percentage of funds going toward hedge funds. 

This year, hedge funds had a 2 percent return through August. At the same time, the S&P index was up 8.5 percent and it comes with lower fees. 

Furthermore, hedge fund holdings now make up 5.7 percent of holdings in the average investment portfolio. That represents a decline of one-third compared to last year. Investors appear to be choosing instead to place their money directly into the stock market. 

 

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Alan Olsen, CPA

Alan Olsen, is the Host of the American Dreams Show and the Managing Partner of GROCO.com.  GROCO is a premier family office and tax advisory firm located in the San Francisco Bay area serving clients all over the world.

Alan L. Olsen, CPA, Wikipedia Bio

 

 

GROCO.com is a proud sponsor of The American Dreams Show.

 

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The American Dreams show was the brainchild of Alan Olsen, CPA, MBA. It was originally created to fill a specific need; often inexperienced entrepreneurs lacked basic information about raising capital and how to successfully start a business.

Alan sincerely wanted to respond to the many requests from aspiring entrepreneurs asking for the information and introductions they needed. But he had to find a way to help in which his venture capital clients and friends would not mind.

The American Dreams show became the solution, first as a radio show and now with YouTube videos as well. Always respectful of interview guest’s time, he’s able to give access to individuals information and inspiration previously inaccessible to the first-time entrepreneurs who need it most.

They can listen to venture capitalists and successful business people explain first-hand, how they got to where they are, how to start a company, how to overcome challenges, how they see the future evolving, opportunities, work-life balance and so much more..

American Dreams discusses many topics from some of the world’s most successful individuals about their secrets to life’s success. Topics from guest have included:

Creating purpose in life / Building a foundation for their life / Solving problems / Finding fulfillment through philanthropy and service / Becoming self-reliant / Enhancing effective leadership / Balancing family and work…

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MyPaths.com (Also sponsored by GROCO) provides free access to content and world-class entrepreneurs, influencers and thought leaders’ personal success stories. To help you find your path in life to true, sustainable success & happiness.  It’s mission statement:

In an increasingly complex and difficult world, we hope to help you find your personal path in life and build a strong foundation by learning how others found success and happiness. True and sustainable success and happiness are different for each one of us but possible, often despite significant challenges.

Our mission at MyPaths.com is to provide resources and firsthand accounts of how others found their paths in life, so you can do the same.

 

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