A shrill frontpage article in today's Wall Street Journal compares hedge funds to roach motels. The story, an expose about Ritchie Capital and its use of gates to preserve itself, employs the roach motel metaphor to irresponsibly illustrate how investors cannot easily withdraw their money from hedge funds. In the 1980s, Black Flag famously marketed the Roach Motel with the slogan, "Roaches check in. They don't check out."
This misguided representation is further indication of media bias agains the hedge fund industry and illustrates the work the industry needs to do to enhance and defend its repuation.
The Journal would better serve its readers by more thoughtful analysis of the important issues that hedge fund investors face, like practices core to valuation, transparency and governance. By doing so it would help the process of getting funds on the fringe raise the way they do business to the level achieved by those who set the bar in the industry.
2 comments:
Another disservice done by the journal to it's readers.
2 thoughts about early redemptions and this pithy analogy
1) Surgeons don't let the patient off the table half way through the procedure
2) Incubator might be a better analogy in this case as at least there seems to be some growth
Sounds like the Journal would have pushed George Bailey off the bridge, and told the townsfolk to accept Mr. Potters' offer. Hardly what I would call providing the best business content and information.
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