Hedged Vision

I know you've deceived me now here's a surprise
I know that you have 'cause there's magic in my eyes
--The Who

Bloomberg reports that many large hedge funds have low net risk levels and high cash positions. For example, George Soros' Quantum Fund is carrying about 75% cash.

Many large hedgies are 'macro' funds, meaning that they allocate assets and trade on broad macroeconomic theses. Fund managers state that they have lowered risk levels because the macro picture is murky. On the one hand, growing debt problems around the world make for a bearish macro scenario. On the other hand, governments seem poised with vast interventionary resources, which may be bullish.

Keep in mind that the 'clarity' that hedgies currently seek may arrive at pretty much the same time for all. Expect some big moves if/when.

position in SPX