Over the past year, the news has reported about many hedge funds that have closed down or have returned capital to investors. They cite many reasons for doing this such as they cannot find value in this market or their strategy is simply no longer working. Others go as far as to blame the Federal Reserve and current/past political administrations for their sub-par performance. I think these are all weak excuses and it shows the inability to do something that all managers must do: Adapt to market conditions.

I’ve been trading for over 20 years. I will be the first to admit that many concepts I learned in my first 15 years of trading are no longer viable. Keep in mind these are principles that were INGRAINED into my thinking and took some time to unlearn. Towards the end of 2015, I made three minor adjustments to my trading (which I plan to discuss in a future blog post). As a result, I am proud that my ability to be open-minded and flexible has led to strong results.

One thing I’ve learned over the past 20 years is that no strategy works all the time. For example, there are times when value will outperform growth and vice versa. Now I am not saying that one has to completely alter their strategy, but I am saying that you have to adapt or else you won’t be able to compete in this fast changing world. As the great Paul Tudor Jones says: “You adapt, evolve, compete or die.”

I can be reached at: jfahmy@zorcapital.com