Hedge funds could be proven right in the longer run, though, if tensions subside and the market's focus shifts back to abundant American supplies
Vishnu Bodapati decided there wasn't enough informed guidance in the market to help him decide on the best investment areas. So, he brought a senior scientist, an economist and a mathematician together, to help build an Artificial Intelligence (AI) model that would learn to make informed decisions for them. Hyderabad-based Hedgeloop, which he established in 2015, is discussed in hushed tones across investment circles. For, their high-end and deep learning-driven software is helping brokers make better decisions."It's important for companies delving in fintech to have a very good understanding of customer analytics, as well as a fantastic algorithm and AI, to make a mark," says Vidhya Shankar, executive director at Grant Thornton India, while discussing upcoming financial technology start-ups in the country. Trading in hedge funds does depend to a great extent on data analysts being able to build complex models to help decision making. And, for the models to be regularly updated, as ...
As they can take cash calls in overvalued markets, leverage portfolio, savvy investor can benefit
Hedge funds in India got a relatively late start, with regulators allowing such investments in 2012
This, provided they don't invest more than 10% of their investable funds in one underlying commodity
The Bloomberg Commodity Index advanced 11% last year, its first annual increase since 2010
This was the year to ridicule hedge funds
Now, traders are wondering when speculators will sell and how quickly prices could fall
The average annual management fee charged by these funds has fallen to 1.39% of the value of a client's assets
Historically, merger arbitrage has been the calm hinterland of the investing world
The 1,400-point-plus rally after the Union Budget has caught hedge funds on the wrong foot, say market people. A number of large hedge funds and foreign institutional investors had gone short on the Indian market before the Budget. However, when the market turned around, they were forced to cover their shorts, that too at a loss of five-six per cent. "Domestic entities, including fund houses, who had kept their faith and invested consistently have come up trumps after the Budget," says a fund manager.Fund house takes a 25% haircut on downgraded debenturesA leading mutual fund house, which held a significant amount of debentures of a recently downgraded commodities major, sold a part of the investment at a loss of 25 per cent. The deal was struck on BSE's debt platform last week and debentures with face value of Rs 100 each were sold at Rs 75 each. The fund house informed its distributors about the deal to allay apprehensions. "The fund house has told distributors that it has infused