Bridgewater Layoffs - Sign of Troubled Times for HFs?

Subscribe

With the biggest hedge fund laying off research analysts and 15 year vets, people think this is a harbinger for bad things to come regarding HF industry, in general?

Comments (63)

 
  • VP in HF - Macro
Jul 24, 2020 - 2:57pm

They were down 20 percent at some point this year. It would be surprising if there were no layoffs

Array
 
Jul 24, 2020 - 5:31pm

Yeah, I heard they’re currently down 14 percent... Wonder how hard it is to get another job if you’re laid off, but you’re coming from a supposedly top place… Whose performance is recently subpar.

 
  • Associate 1 in HF - EquityHedge
Jul 24, 2020 - 8:47pm

Their investing style doesn't translate to most other places. Not an easy transition from there.

Array
 
  • Quant in HF - EquityHedge
Jul 24, 2020 - 8:12pm

other MMs have already done a round of layoffs too

Array
 
Jul 24, 2020 - 11:43pm

China is one of the markets where risk parity may still work, but otherwise that business model is dead for developed markets.

I think it is bwat specific to the extent they had a nice 40 year run where being long assets worked well, but that won't be the case going forward over a longer period of time.

Do you really expect bonds to hedge equities on a go forward basis ? It's all about discount rates now, so you will see a lot more bonds down stocks down in what used to be a var shock type event.

 
Jul 25, 2020 - 8:16am

No, the issue is largely that central banks are determining the prices of risk and their put has forced the market into a spectrum of risk positions. That is why gold has become so attractive as the only thing to offset that via ccy depreciation.

The model has broken because central banks are going to crowd out the private sector on fixed income, and risk parity fails under that model.

There are no real hedges anymore that are investable assets unless you want to play the fx game.

 
  • Investment Manager in HF - Other
Jul 25, 2020 - 8:43am

You are talking about all weather, that is a piece of their aum, but the other (and slightly larger portion) is pure alpha, which is not a risk parity strategy. When people quote Bridgewater performance they are almost always talking about the alpha strategy, not risk parity.

Array
 
Jul 27, 2020 - 10:45am

surcitycredit09:

I think your missing the point. Capital doesn't disappear. It moves from one pocket to another. If it flows out of active, it moves into passive or maybe another fund. We see our clients move assets from equities funds to other funds.

I think "you're" missing the point. (Had to before some needs points it out)

Money supply changes, capital does disappear...it's called fiat for a reason. Wtf are you talking about?

If the glove don't fit, you must acquit!
 
Jul 27, 2020 - 11:51am

my priorities if I was a decabillionaire would probably be omnipotence and a 15" willy, not adding alpha.

glad others are finally realizing dalio is not all knowing, BW is not perfect, and while they're a good place to work, everybody gets their licking at some point

 
Jul 29, 2020 - 9:03am

After the last recession, HFs using insider information was prevented via government crackdowns. Dalio was infamous for using sensitive government info, like the housing bubble, to profit via BA. Now that he can't, of course he's not abnormally exceeding the market. The best way to "win" the market is to hold on for the long run.

Start Discussion

Total Avg Compensation

September 2020 Hedge Fund

  • Vice President (18) $520
  • Director/MD (10) $359
  • Portfolio Manager (7) $297
  • 3rd+ Year Associate (18) $269
  • 2nd Year Associate (25) $242
  • Engineer/Quant (46) $237
  • 1st Year Associate (58) $189
  • Analysts (175) $167
  • Intern/Summer Associate (12) $134
  • Junior Trader (5) $102
  • Intern/Summer Analyst (183) $80

Leaderboard See all

1
Jamoldo's picture
Jamoldo
98.3
2
LonLonMilk's picture
LonLonMilk
98.3
3
Secyh62's picture
Secyh62
98.2
4
CompBanker's picture
CompBanker
97.8
5
Addinator's picture
Addinator
97.6
6
Edifice's picture
Edifice
97.6
7
redever's picture
redever
97.6
8
frgna's picture
frgna
97.5
9
NuckFuts's picture
NuckFuts
97.5
10
bolo up's picture
bolo up
97.4