Every investor and trader knows that the stock market swings up and down on Federal Reserve comments, earnings, economic numbers..ect. However, a majority of investors, if not all have overlooked this one major negative catalyst, hedge fund redemptions. Hedge funds are closing at a record pace as their performance has been subpar, not even beating the S&P 500. Just today, it was announced that Perry Capital is closing is flagship fund because of record redemptions. Every week there is a new fund closing. This is a huge negative for the stock market because redemptions mean the hedge fund has to liquidate billions in stock to give its investors their money back. When you add up all the redemptions from investors in these hegde funds, it is hundreds-of-billions of Dollar. The selling itself can kill the market, not to mention an unforseen catalyst. Be warned, this is a big deal no one is talking about.
These factors are just one more reason why I am short the stock market overall. There is just too many negatives out there, with more showing their faces every day.