Hedge funds could pay a heavy price for crowding into the same trades.
That is the view of Mike Jemiolo, chief risk officer at Point72 Asset Management, who spoke at the RiskHedge USA conference in New York yesterday (September 20).
"The biggest challenge right now is crowding," he said. "The problem is that for many, many years crowding worked – if you loaded on that factor, you made money. But starting in mid-2015, long crowding stopped working pretty steadily and fairly catastrophically in Ja