Ray Dalio Is Proud Owner Of World's Largest Hedge Fund

Ray Dalio's phenomenal track record has finally caught up with him, as his Bridgewater Associates is now the world's largest hedge fund measured by assets under management. Nonetheless, his positioning may be precarious due to his close relationships with sovereign wealth funds such as ADIA, who, as we wrote previously, are experiencing significant losses and may eventually be forced to collect some of their cash from whatever readily available sources they have.

Sphere: Related Content

Bookmark this post with:

• 
• 
• 
• 
• 
• 
• 
• 
• 

Bridgewater Warns Most Investors "Will Inevitably Do Badly"

In his annual letter to investors, Ray Dalio, whose $80 billion Bridgewater fund is doing phenomenally well, returning almost 9% in 2008, had some advice and warnings to investors. Key among them: to be truly objective when designing a portfolio of investments and to remove any market bias, as strategy optimization without a deep enough understanding of "how it would work in all circumstances, including circumstances that did not occur within the period that's your frame of reference, you will inevitably do badly." In other words, if you don't anticipate everything that could happen when you throw money in the market, you are bound to lose.

Sounds like wise advice.

Bridgewater's Pure Alpha fund, is an actively-managed, signal-translating global fund, that participates in everything from copper, to currency, to treasuries, and has consistently generated significant returns over risk free rates. Sphere: Related Content

Bookmark this post with:

• 
• 
• 
• 
• 
• 
• 
• 
• 

Rick Bookstabber Implicated in Dr. Seuss Parody

Bridgewater quant guru and author of A Demon of Our Own Design, Rick Bookstabber, has found an unexpected role in this curious take on Dr. Seuss' The Lorax. Enjoy, courtesy of The Nervous Breakdown.

Sample:

The following week my newest sensation
was an exchange-traded product based on inflation.

I was tireless in my creative formation
of new instruments that needed translation.
My epic was collateralized debt obligation

though I also showed off my inventive chops
with a little something I called credit default swaps.

I meant no harm. I most truly did not.
But I had to grow bigger. So bigger I got.
I securitized mortgages and credit card debt.
I securitized insurance. I securitized Tibet.

**********UPDATE**********

We have learned that Bookstabber (that name is almost as cool as that of the Artradis Barracuda fund we profiled earlier) is no longer at Bridgewater. Sphere: Related Content

Bookmark this post with:

• 
• 
• 
• 
• 
• 
• 
• 
•