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And then to make sure that we beat the private equity benchmark or the equity benchmark with that selection. I know there’s a bunch of different benchmarks. So that, 00:39:33 [Speaker Changed] Well, 2022 was pretty much a down 15% year for treasuries and down 20 plus for equities. Fair, fair insight.
I was trying to buy treasuries and I was very frustrated by the commissions I was getting charged on that. So for sure, February, March, 2020, you know, even treasuries, high quality investment grade, you know, the whole thing e everything was seeing dislocation, right? But I, I was very, very excited about it. The big one was COVID.
In bond markets, the yield on the benchmark U.S. 10-year Treasury note ticked up to 1.847% from 1.825% Thursday. Oil prices climbed, with the global benchmark Brent crude up 0.5% “Every investor is so spooked now, and nobody really has a compass to figure out where exactly we are in this cycle.”. a barrel. .
SEIDES: If the S&P is your benchmark, which it isn’t for these pools of capital. RITHOLTZ: What should be their benchmark? So the proper benchmark for those pools has to look a little bit like the underlying assets they’re investing in. So what do you use for a benchmark? 14, 15% a year? RITHOLTZ: Right.
RITHOLTZ: And those were Treasuries. RITHOLTZ: And last question about the various teams, does everybody have a different benchmark? RITHOLTZ: Let’s jump to Our favorite questions that I asked all of our guests, starting with tell us what kept you entertained during the pandemic. TROPIN: Right. TROPIN: Yeah. No, no, no.
They create the benchmark. So when there’s a major turnover like that that happens, you always have the option, “Hey, can you do it exactly on the time that it enters the benchmark? And 87% of our active fixed income funds have outperformed their benchmarks on a three year basis against their benchmarks.
And I literally just started putting adjectives and nouns on piece of paper, trying to figure out like how do I describe the work that I think I should be doing, and that hopefully, people find at least entertaining, if not valuable? NADIG: Well, I mean, there’s like TLT, with the big Treasury funds, LQD and HYG. NADIG: Right.
He has absolutely crushed his benchmark over that period. He’s crushed the Russell 2000, whatever benchmark you want to talk about. He developed the Ginnie Mae contract, which at one time was a big thing in treasury bond contract. The s and p 500 has underperformed his fund by 3.7% a year since 1989. Much better.
And they also have a unique approach to feeds when they’re generating alpha, when they’re outperforming their benchmark, they take a performance fee. Some people look at a casino as entertainment and hey, we’re gonna spend X dollars, pick a number, 500, 2000, whatever it is. For 50 years. This is a step change.
And because remember, Lehman had the Lehman Agg and that was the benchmark. There is above benchmark returns to be generated by active selection of credit quality duration and specific bonds. RIEDER: Why do you need the price of the Treasury market to the two-year forward or the three-year forward? There is alpha. RIEDER: Yeah.
Their benchmarks were down. So let’s say you have, you know, a thousand basis points over the treasury is a, say a distressed situation. What’s been been keeping you entertained? As an example, institutional investors mentioned King Street in 2022, perhaps the worst year for hedge funds since oh 8 0 9.
And it covers the spectrum of fixed income from treasuries here to high yield there, and everything in between. They take a benchmark in that case, the aggregate index is by bar the, the most common one used. Let, let’s allow you to do more and have a wider degree of risk and off benchmark in your sector.
00:18:13 [Speaker Changed] When markets are going up, the benchmark is either an index like the s and p 500 or you know, someone you know that’s making even more money than you are. But it’s amazing how quickly the benchmark turns into cash or a positive return when markets are going down.
So, for example, the treasury was thinking about moving to direct deposit, but they wanted to know how much it was gonna cost them because direct deposit, they, they, they, they, the money clears, you know, sorry, almost instantly, right? So they wanna know how many days does it take a, a treasury check to get back to us.
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