Yesterday we reviewed some of the commentary on Calpers decision to opt of hedge funds. The feedback continues to come in so we decided to break out this discussion into a standalone post. The consensus seems to be that picking hedge funds is a difficult task for anyone, including big managers like Calpers, the costs of hedge funds are simply too high and that individual investors are really not missing out on all that much by being locked out of hedge funds. Enjoy.

“Picking the winning hedge fund managers is hard.”  (Alpha Attribution)

The scuttlebutt was that Calpers was bad at picking hedge funds.  (Business Insider)

Why Calpers kicked hedge funds to the curb: negative alpha.  (Alpha Architect also Bloomberg)

Who benefits from the end of hedge funds at Calpers?  (WSJ, MoneyBeat)

Calpers isn’t really going to miss their hedge fund allocation.  (Matt Levine)

Why do institutional investors bother with hedge funds?  (FT, ibid)

Why Harvard should emulate Calpers, not Yale.  (Barry Ritholtz)

Hedge funds never were an “asset class.”  (Brian Portnoy)

Cliff Asness, “We believe there are many strategies pursued by hedge funds and active managers in general that don’t rely on very obscure skills, and therefore that should not earn them two and twenty.”  (AQR)

Breaking down the costs of hedge funds.  (FT Alphaville)

Individual investors should thank their lucky stars they can’t invest in hedge funds.  (Mark Hulbert)

Investors aren’t missing much by avoiding alternatives.  (Aleph Blog)

What lesson should individual investors take from Calpers’ decision?  (Dan Solin)

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