Deals Are My Art Form

“I don’t do it for the money. I’ve got enough, much more than I’ll ever need. I do it to


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Comments

  1. So active liquid strategies are losing retail money to passive investing (now, to be had, for free - uh-huh) and “sophisticated” institutional money to Private Equity and similar “straight forward” (uh-huh, again) deal-like investments. I agree, those dynamics are not short-term or cyclical.

    Tangential to your point, hedge funds, IMHO, destroyed themselves as they (many, not all) didn’t market themselves as “hedged” funds - lower vol investments providing better risk-adjusted returns - but instead, at least until '08, sold themselves as wonder investments allowing you to tap into a super-genius person or super-genius blackbox. I guess Epsilon Theory would say they broke their own story / I’d say they ain’t putting that toothpaste back in the tube.

    Maybe enough years of better risk-adjusted returns in down markets versus indices (or just better notional returns, a tautology for a true hedge fund in a down market) will help, but only so much. The real question is how long until PE breaks as there’s no chance it can work now that it’s the popular trade, excuse me, investment.

  2. I’m curious if this retail focus combined with the corporate tax repatriation, which will be used for M&A in a similar deal space, will cause price inflation and decrease returns. Or it could lead to a short term increase in valuations and benefit these funds.

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