Fund managers are barely paying attention to the drama in Washington, because they say it's impossible to make bets ahead of a debt resolution. And nearly every fund manager expects a resolution, even if it goes down to the wire.
"I'm still of the camp that this will get solved at the very last minute, and until then, there's nothing to do," a manager of a $6 billion hedge fund who requested anonymity said Monday morning.
"But, if nothing gets solved by October 17th and the Dow drops 1,000 points, I'm a buyer," he added.
Several other fund managers echoed his sentiments Monday. Few, if any, intend to make any trades with the debt ceiling in mind. That is unless Congress actually lets the U.S. default.
Should that terrifying prospect play out, most hedge funds managers expect the stock market to fall precipitously. That crash or correction would offer a reason to buy stocks... immediately.
Still not everyone is as calm.
One manager who invests in several hedge funds on behalf of his clients wrote via email: "My managers aren't concerned, but I am."
He worries that everybody is too complacent right now and that the market could get caught off guard. For now, he hasn't found many people in the investment world who share his angst.
The opinions expressed in this commentary are solely those of Paul R. La Monica. Other than Time Warner, the parent of CNNMoney, Abbott Laboratories and AbbVie, La Monica does not own positions in any individual stocks.
Hedge fund manager Bill Ackman is having a rough year. But don't shed too many tears for him ... not that you probably would anyway, given that he's a billionaire and all.
Yes, Ackman's Herbalife (HLF) MOREPaul R. La Monica - Aug 13, 2013 12:57 PM ET
As the housing market heats up, so is competition among home improvement retailers.
A day after Home Depot (HD) delivered earnings and revenue that were much better than forecasts and raised its guidance, Lowe's (LOW) reported a weaker-than-expected quarterly profit for the first-quarter on declining sales.
Lowe's CEO Robert Niblock blamed "cooler than normal temperatures and greater precipitation" for the soft sales figures. In contrast, Home Depot CEO Frank Blake said his company continued to MOREHibah Yousuf - May 22, 2013 1:14 PM ET
Hedge fund managers might like Chipotle's burritos, but some are betting against the company's stock.
Last October, Greenlight Capital's David Einhorn revealed a bet against Chipotle Mexican Grill (CMG). On Wednesday, bond fund manager Jeffrey Gundlach of investment firm DoubeLine Capital joined him in talking down the fast food chain.
"I like the products," Gundlach admitted. Yet, he said, "A gourmet burrito is an oxymoron. All you need to compete with its MOREMaureen Farrell - May 9, 2013 12:16 AM ET
The gold bugs have come out to play.
Gold bounced back Monday after taking a massive beating over the past week or so.
Early Monday, gold prices popped back above $1,400 for the first time in a week. Prices are still a far cry from their record $1,900 level but the modest bounce is encouraging for gold bugs.
It was exactly one week ago that gold prices plunged more than 9% in their MORECatherine Tymkiw - Apr 22, 2013 12:02 PM ET
It's a tough week to be a retailer in search of customers. First, the shares of J.C. Penney (JCP) cratered after the Ron Johnson-led retailer reported abysmal fourth-quarter numbers Wednesday night.
Next up: Sears (SHLD). The iconic retailer can't turn a profit or get customers excited about its merchandise or Kmart's. After reporting yet another quarter of steep losses early Thursday, Sears' stock dropped nearly 5%.
Releasing results so close to JCPenney at least makes MOREMaureen Farrell - Feb 28, 2013 3:15 PM ET
It's Herbalife's turn.
As hedge fund titans Bill Ackman and Dan Loeb square off over the company's sales practices, the company's top executives played defense.
"We are confident that you will see that we're a legitimate company with legitimate customers," Herbalife CEO Michael Johnson told investors and analysts gathered at the Four Seasons in midtown Manhattan Thursday. Johnson called the opportunity to address the crowd "unusual but incredible."
Ackman, who runs Pershing MOREMaureen Farrell - Jan 10, 2013 10:31 AM ET
This article was published in the December issue of Money magazine.
The world of hedge funds may be shrouded in secrecy. But savvy investors can profit handsomely by following the public moves of some of the industry's high-profile players, especially as many are taking a more active role in cleaning up troubled companies.
In July 2011, Carl Icahn, one of the most famous "agitator" investors, put pressure on cellphone maker Motorola Mobility MOREPaul R. La Monica - Nov 28, 2012 9:45 AM ET
Hedge funds are betting on a disaster hitting the financial markets within the next several quarters, with managers holding onto historic levels of cash.
That so-called dry powder gives them the cash they need to quickly jump in if markets sell off, according to numerous hedge fund managers and industry consultants.
"Most hedge funds I see are carrying lower market exposure than I've seen in some time," said Brad Balter, MOREMaureen Farrell - Aug 23, 2012 8:01 AM ET
Hedge fund manager Dan Loeb, once a supporter of President Obama, is now a critic. But he appears to think the president's health care plan will be a boon for health insurers. And he's not alone.
Loeb and noted short seller David Einhorn accumulated new positions in multiple health insurance stocks at some point in the second quarter, according to SEC filings released Tuesday.
Both Loeb's Third Point Capital and Einhorn's Greenlight MOREMaureen Farrell - Aug 15, 2012 3:26 PM ET
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