Peter Troob
Co-Founder & CIO, Troob Capital Management · 1 appearance on the record.
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Peter Troob is the co-author of the bestselling Wall Street memoir Monkey Business, chronicling his experience as an investment banker at Donaldson, Lufkin & Jenrette. In 2002, he co-founded Troob Capital Management, where he manages distressed debt, private credit, and opportunistic capital strategies.
21statements → 4claims → 1claims resolved → 3.86/5average certainty → 2.52/5average debate potential → ≈4.5/5argument clarity, estimated →
1 supported 0 partly supported 0 contradicted 3 not checkable as stated how the 4 claims stand · each chip opens the sources
2 predictions · 2 assertions · 7 opinions · 8 insights · 2 disclosures · every statement was checked. The predictions and assertions are the 4 claims: statements the public record can support or contradict. 1 is resolved, and 3 name no date, number or outcome precise enough to check. Everything else (opinions, insights, what ifs, disclosures) can never be settled by the record, so it carries no assessment.
The record, in short
What the tape says about how Peter argues and how the claims held up. Everything they said, and everything said about them, is in the tabs below.
Their most notable supported claim
The $1.2 Trillion High-Yield Bond Market Is Five Times Levered
“What you have is a massive market, about 1.2 trillion of bonds in the high yield market, half of which Are double B and half of which are below double B. That is weak. It's five times levered. And you have a market that's very vulnerable.”
How they sound: not measured why? →
We measure speaking style by listening to the audio itself, and a fair number needs at least 2,000 words from one person on tape we have measured. There is too little of Peter Troob on measured tape to publish a rate. This says nothing about how they speak.
Everything Peter Troob said on Capital Allocators that made the record, most notable first. Filter by type, assessment or year in the ledger →
Passive Distressed Debt Investors Underperform Lead Investors by 500 Bps
“I think any one year can come out differently, but I think over time you're going to get high single, low double digit returns out of the control leader, and you're going to get 500 basis points worse out of the other guys over time, because what they'll get c…”
Illiquid Structured Bonds Only Avoid Drawdowns Because They Escape Marking
“This idea that you invest in non-liquid structured product bonds, and say, but look at those, they never go down. They don't go down because they never get marked. It's not that they don't go down because they don't go down. That's a fool's game that will get …”
PE Sponsors Strip Distressed Bondholder Collateral via Restricted Payment Baskets
“What, I mean, you can see it in what they did with J.Crew, where they can, and now they're, I think they might be doing it in PetSmart as well, where they're able to have a restricted payment basket, move parts of companies out, and the bond guys get held, sit…”
Distressed Debt Returns Will Remain Muted Without a Systemic Shock
“So you either have to have a monster shock to the system, which I'm not sure anyone foresees, or you're gonna find that distressed returns are muted because of the amount of money, until money starts coming out.”
High-Yield ETFs Will Suffer Severe Price Gapping During Massive Sell-Offs
“When you start having that problem, you'll just see gapping. It will eventually happen. It'll work itself through. The ETF will then get smarter and better the next time around, but you'll have to live through that,”
Mega Distressed Funds Outcompete Smaller Players via Capital Duration
“The very large players, I mean, the ones with north of 10, twenty billion, even bigger than that, they just have longer term assets, they can make structurally interesting decisions, and they can both wait you out and buy you out in, like, rights offerings whe…”
Distressed Debt Investors Must Target Sub-$20M Deals for Deal Control
“The large guys have a big advantage right now. They really get the look at a better deals, and they get to structure them themselves. You have to go pretty far down the curve, maybe sub-twenty, sub-fifteen million dollar kind of investments where they don't ca…”
High-Yield Bonds Are Like Pennies in Front of a Steamroller
“So the question is, picking up three, four, five, six percent in high yield from today forward, it's like picking up pennies in front of a steamroller. Is it worth it? That's the question. And my answer to that is no.”
PE Sponsors Will Not Subordinate Equity to Save Distressed Bondholders
“So they will be economic animals. They will look for the best return for the reward of what, for the risk they're taking, and there is no reason why they come in and just subordinate themselves to bonds and save the bond market.”
Apollo, KKR, and Oaktree Lack Meaningful Differentiation in Distressed Debt
“Is Apollo and KKR and Oak Tree, what's the difference? And the answer is, there's not a lot of a difference.”
High-Yield ETFs Act as Marginal Price Setters in Credit Markets
“I mean, they are the proverbial tail that wags the dog. They are the marginal price setter. Every day, every quarter, every month, you see it. Flows are in, flows are out.”
Paying Hedge Fund Fees for Mega-Cap Tech Stocks Is Not Valuable
“And I know this is not the greatest thing to say, but being in the hedge fund business for all these years, it's interesting how few hedge funds I give money to. And it's not because I don't want to. It's that the market's gotten more efficient. There's a lot …”
Adjusted EBITDA in Financial Offering Documents Is Entirely Make-Believe
“It's not real. It's make-believe totally, and I think it fools a lot of investors.”
The $1.2 Trillion High-Yield Bond Market Is Five Times Levered
“What you have is a massive market, about 1.2 trillion of bonds in the high yield market, half of which Are double B and half of which are below double B. That is weak. It's five times levered. And you have a market that's very vulnerable.”
In Brokered Investment Deals, Lacking the Last Look Means No Look
“Once you get into a brokered situation, it's not that it's bad, but if you don't get the last look, effectively in my world, I think of you get no look. It's like the Ricky Bobby quote, right? If you're not your first, you're last. Right. And the problem is th…”
Troob Targets 30% Portfolio Liquidity to Buy Assets During Downturns
“I want probably 30% liquid, because I always believe there is something around the corner. And I want to be the guy who buys and doesn't have to sell because I could get myself into the same problem as anyone else.”
Revenue-Based Venture Lending Generates Nearly 30% IRR Over Two Years
“And what we're finding now out in the venture capital world is they will take a million dollars, let's call it 2,000,002 million dollars, and give you one and a half times your money, three million, back in two years, paying you monthly off of revenue stream. …”
Banking Regulations Create a Void in Sub-$15M Growth Financing
“Because of regulation, and because of the way the regional banks and the community banks have to deal with regulation, there is a Real void of when companies, entities need money, again, in the sub-fifteen million dollar space, and nobody really cares. A compa…”
Investors Should Read Investment Prospectuses Backwards to Spot the Risks
“As I said in my book, if you want to read a prospectus properly, read it like a Chinese menu. Read it from the back Or read it like, you know, the Bible. Read it backwards.”
Junior Investment Bankers Toil in Obscurity for $15 an Hour
“For a young investment banker, which I was at the time, it's really just about a coming of age of realizing that the emperor has no clothes, Realizing that you're toiling in obscurity, probably for less than 15 dollars an hour, even though you thought you were…”
Troob Exits Credit Positions When Mega-Fund CDS Manipulation Battles Emerge
“I've smelled it in a couple things I've been in. I get out of the game. I will get run over. I can't play that game. It's, I'm not nearly big enough to deal with it, and so what I do is I just allow the big guys to beat each other up, which they're doing, and …”
Appearances (1)
| Episode | Date | Speaking time |
|---|---|---|
| Peter Troob – Monkey Business in High Yield (Capital Allocators, EP.59) | Jul 2, 2018 | 39m |