Will Baupost Follow Its Own “North Star” Amid Challenging Quarter?

For those investing in hedge funds, timing their allocation on a drawdown has always been a difficult if even controversial topic among allocators. Tiiming the investment after the point at which a hedge fund has exhibited significant mean reversion has practical execution hurdles as well requiring nerves of steel. Hedge funds, too, have similar issues in investing after a market has experienced significant losses, as a recent Baupost letter to investors reviewed by ValueWalk illustrates.

[klarman]

The question that remains un-answered after Baupost's reported negative year to date performance is: Did the potential king of finding value in drawdowns, the value investor that has a history of delivering annualized average...