Invest Like the Best with Patrick O'Shaughnessy cover image

Lee Ainslie - Hedge Fund Maverick - [Invest Like the Best, EP. 341]

Invest Like the Best with Patrick O'Shaughnessy

NOTE

Underperformance Since the Financial Crisis and Predictions for Future Fed Funds

The past 12 years have been marked by underperformance in the financial markets. Despite lower exposure, many funds performed worse than the market. We are now in a different role and likely to be in a different world. The market predicts that Fed funds will be between 3.7 and 5.5 percent, far from the benchmark of 2.5 percent. However, the rate of returns for equity markets under 2.5 percent is similar to those above. It's like comparing two swimmers racing downstream where the difference in their finish is not significant. But when they swim upstream, the stronger swimmer becomes more apparent. Similarly, companies operating in different capital costs will reveal their strength.

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