Hi all,
I understand different HFs have different drawdown limits for AUM cut and dismissal (MLP seems to have the tightest). Could anyone give an idea what the range is for the major HFs and over what time periods are they applied (day, week)? Also are there different limits for different asset classes (fixed income vs equity)?
Thanks!
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Most are 2.5%/5% for capital cut in half/stopped out. Bluecrest has no 2.5% level. Brevan is 3.5/7. Not sure about others.
MLP has 5% soft stop, 7.5% hard stop from peak to trough. Fairly similar in other places. Bluecrest have the tightest around 2.5% with some PMs even being cut for being flat over a year
You're using different denominators in the MLP and BC numbers. Apples and oranges.
Was not comparing the two. Separate shops obviously run things differently, it’s always going to be apples and oranges. Alone, the statements stand true, you drop 2.5% at BC and you’re gone
What I'm saying is I don't think you understand the formula to calculate the 2.5% and how it's different (by a factor of 2x) across certain funds.
Enlighten me
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