Susan Blumner looks over the hedge and view the hogs inside:
Are they (hedge fund managers–ed.) worth it? They certainly think so. But the system is rigged. Even when hedge funds, which are basically big, sparsely regulated pools of investment capital, don’t do any better than market returns, their managers can walk away with the equivalent of a small nation’s GDP.
Take Steven Cohen of SAC Capital Advisors. Cohen’s 2012 pay was $1.4 billion. For this, he obtained a 13 percent return for investors. Sounds good, right? Except that the Standard & Poor’s 500 stock index shot up 16 percent last year when factoring in dividends. SAC investors paid a 50 percent performance fee to Cohen despite the lagging numbers.
Having no shame is one of the rules for success as a hedge fund manager.
Read the rest.