Portnoy: Institutional hedge fund wave began after 2000-2002 drawdown
Brian Portnoy · Brian Portnoy – From Complex to Simple (Capital Allocators, EP.57) · Jun 18, 2018 · at 10:37
Brian Portnoy reflects on his transition to Mesirow Financial and the macro drivers behind the early-2000s boom in fund of hedge funds.
0:00 / 0:20exact quote · 20.9s
720p mp4 · rendered on demand · StarZero watermark
“The big institutional wave into hedge funds began after the 2000 to 2002 drawdown because so many funds, as we've talked about for a long time, were prescient enough or smart enough to be long value and short growth, and they survived 99, and they put up absolutely monster numbers.”
quote is from the automated transcript, cleaned for reading: filler sounds and stutters are removed, nothing is rephrased. names can be misheard (the analysis reads context, assessments check outside sources). how →
More from Brian Portnoy
Volatility is genuine risk because it induces investors to abandon their plans
“The smartest of the smart guys say that volatility is not risk. And I strongly, strongly disagree. Because if you're, what you're really trying to do is achieve your goals in life, and the more volatile an investment is, Makes it more likely that you're going …”
Investors do not earn a complexity premium for intricate investment strategies
“I would argue that there's not a complexity premium for investors.”
Portnoy: Investing success means meeting client expectations, not beating benchmarks
“What I concluded after putting a lot of thought and time into it over a couple years was that true success in investing, broadly defined, is when expectations Map up with outcomes. And I began to realize, not in its fullest fruition, in the second book I explo…”
Portnoy: Complex investment strategies are most likely to disappoint
“The more complex a strategy, the more moving pieces it has, the harder it is to set expectations. So, precisely the funds that we think are positioned, To do the best for us during complex times are probably the ones best positioned to disappoint us.”