Jason Karp, founder of Tourbillon Capital and CEO of HumanCo, discusses structural alpha erosion and fee justification in the hedge fund industry with Ted Seides.
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“95% of managers, the bulk of their returns are some form of beta.”
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More from Jason Karp
Opinion
Karp: Even 80th percentile hedge fund managers are doomed
“I think the averages are doomed. I think even 80th percentile is doomed. I think you have to be in the 99th percentile at this point, whereas 20 years ago you could have been in the sixtieth percentile and you were pretty good.”
Jason KarpNov 11, 2019▶ 22:42Jason Karp – From Hedge Funds to Health and Wellness at HumanCo (First Meeting, EP.12)
Opinion
Karp: 3G Capital's Kraft Heinz model has been horrific for human health
“And, you know, Kraft Heinz is the perfect example of this, is that there's been almost this three G mentality towards things that we put on and into humans. And that has been potentially for some period of time, good for shareholder value. It has been horrific…”
Jason KarpNov 11, 2019▶ 44:57Jason Karp – From Hedge Funds to Health and Wellness at HumanCo (First Meeting, EP.12)
Insight
Karp: Discoverable market anomalies get arbitraged away, but disciplined human judgment does not
“And I had a mentor a long time ago who told me that he believed that almost everything that was discoverable in finance would be arbitraged away, but human judgment would not, and that human judgment, good judgment, was rare, and that balancing it with emotion…”
Jason KarpNov 11, 2019▶ 8:26Jason Karp – From Hedge Funds to Health and Wellness at HumanCo (First Meeting, EP.12)
Insight
Karp: Over half of short-term investing variability is pure randomness
“Being stuck to a screen where more than half of the variability is random, and you could do everything right from a process perspective, but actually still get it wrong, that was incredibly frustrating for me”
Jason KarpNov 11, 2019▶ 19:16Jason Karp – From Hedge Funds to Health and Wellness at HumanCo (First Meeting, EP.12)
Insight
Karp: Scientific Understanding of Health and Wellness Is in Inning Two
“Our understanding as human beings of health and wellness is like in inning two, and there's not enough science on it.”
Jason KarpNov 11, 2019▶ 36:57Jason Karp – From Hedge Funds to Health and Wellness at HumanCo (First Meeting, EP.12)
AssertionContradicted
Karp: Most commercial vapes use unsafe petroleum-derived carrier oils
“Most of the vapes right now use propylene glycol. They have other petroleum derived oils that they suspend the cannabinoids in that humans are effectively combusting and inhaling, which is definitely not safe.”
Jason KarpNov 11, 2019▶ 1:01:55Jason Karp – From Hedge Funds to Health and Wellness at HumanCo (First Meeting, EP.12)
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