This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Taking the (Investing) Road Less Traveled

NEW YORK ( TheStreet) -- I believe the portfolios of retirees and near-retirees can benefit from alternative investments. But I'm not sure that hedge funds really reprsent the alternative investment asset class.

Hedge funds seem like a way for Wall Street's brightest stars to make obscene amounts of money by doing what they have always done, but with a lot less transparency.

But because hedge fund managers are some of the best and brightest and tend to hold ideas close to the vest, it is worth listening to them when they do talk.

Accordingly, when Steve Einhorn, vice chairman and portfolio manager for Omega Advisors; Harvey Eisen, chairman of Bedford Oak Advisors; and Michael Novogratz, a principal with Fortress Investment Group (FIG) got together for a panel discussion about the direction of the markets for the balance of 2012 and for 2013, I was anxious to learn their thoughts.

It's worth noting that the panel discussion was related to charity, not something hedge funds are typically known for.

The panel was held to drum up support for Trading Day for Kids, a once-a-year event (to be held Oct. 25 this year) where the hedge fund community does all its trading through one broker who then donates all the commissions to Youth, I.N.C., a master charity that redistributes the money to some wonderful nonprofits in New York City.

So what was the consensus view? All three investors are bullish for next year and bullish long term. This is good news, sort of.

I say "sort of," because underpinning all of their thinking in one way or another, was the Federal Reserve's quantitative easing policy and the advent of QE3.

Fortress' Novogratz said, "With QE3, Bernanke basically doubled down. To me it looks like maniacal behavior precisely designed to bring about a change in thinking that will cause dollars now in conservative fixed-income investments to rotate into riskier asset classes."

I don't entirely agree. As the clock ticks along on the Fed's policy approach, the day may well come when the $10 trillion sloshing around in fixed-income investments held by pensions funds will migrate into equities. To put the possible impact of this into perspective, the market capitalization of the New York Stock Exchange is about $15 trillion.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
AAPL $110.37 0.00%
FB $88.15 0.00%
GOOG $606.25 0.00%
TSLA $245.57 0.00%
YHOO $32.54 0.00%

Markets

Chart of I:DJI
DOW 16,374.76 +23.38 0.14%
S&P 500 1,951.13 +2.27 0.12%
NASDAQ 4,733.4970 -16.4820 -0.35%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs