October 2016

History is Repeating Itself with Trends in Smart Beta

(or, Why the Quality Factor Will Disappoint Investors) In this article in HFMweek, Beachhead’s managing member, Andrew Beer, talks about the quality factor and concludes that, rather than reflect a new risk premium, it is more likely the statistical validation of a long-term convergence of growth and value investment strategies.  As a result, returns going forward are likely to disappoint investors. HFMweek subscribers click here to access this article, or contact us for additional information.

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NYSSA Keynote Presentation: Emerging Hedge Funds: Today versus 2006

In his keynote address to the New York Society of Security Analysts (NYSSA), Andrew Beer shared his views on launching a hedge fund in today’s environment and discussed the many ways in which the process changed over the last decade. This presentation was very well received and we suspect that it will likely be of interest to anyone in the pre-launch or post-launch phase, or simply working to raise additional capital. For more information, please visit NYSSA’s website and feel free to view attached.

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ETFs Offer Hedge Fund Returns, Without The Fees

The following interview with Andrew Beer appeared in the October, 2016 issue of ETF Report.  In this exchange, Beer explains how Beachhead evaluates long/short strategies and replicates hedge funds using ETFs. Introduction: While many hedge fund strategies can deliver great performance, sky-high management fees often eat into returns, poaching as much as 80% of alpha over the past 10 years, according to Beachhead Capital Management. ETFs offer an alluring alternative, allowing investors to copy hedge fund strategies without all the fees. Since 2012, Beachhead has been doing just that. The New York City-based firm uses liquid ETFs and other instruments …

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Should you ignore financial academic research?

Excerpted text from Andrew Beer’s article in Investment Europe today: Marketers like nothing more than to pitch a product “grounded in decades of academic research.”  The implication is that objective academics have dispassionately studied market phenomena to uncover canonical truths.  In theory, this makes the investment decision easy – think “value outperforms growth” or, more recently, “quality stocks outperform.” Don’t be fooled.  Academic papers are subject to five very serious limitations: 1.    Publishing Bias 2.    The Big Splash Phenomenon 3.    The Assumptions Are Everything 4.    The World Changes – A Lot 5.    Business and Academia Overlap Click here to read …

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Risk Premia: Theory vs. Reality

In a recent issue of Hedge Fund Intelligence, Beachhead Capital Management’s Andrew Beer explains why the theory of risk premia investing is complicated in practice.   Click here to register and access the full article, or contact us for additional information

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P&I Article: What every allocator needs to know about hedge fund replication

From guest contributor Andrew Beer: In the current heated debate on hedge funds, there’s no middle ground. You’re either pro or con, in or out, red or blue. But this is, frankly, stupid. Hedge fund proponents make legitimate points about diversification, but fail to acknowledge where they’ve been flat-out wrong on many issues (e.g. wishful thinking that alpha would adequately cover fees). Likewise, the “out” camp is correct that fees are egregious, but offer no credible alternative. Redeem from hedge funds and invest in … bonds with negative yields? Equities at the tail end of the second-longest bull market in …

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