Great episode, a throwback to Ep 200 where I remembered how Professor Fama spoke about the difficulty of estimating the expected returns of alternative assets due to data opaqueness and the self-selectivity. Great to see an episode about it!
Dynamic Beta investments has two (US) ETFs that attempt to replicate hedge fund returns using an automated strategy that sounds like it might be similar to what was mentioned in this episode.
What I get from this... outside of some super specific hedging strategy, there's little incentive for a "normal" investor to waste time with alternatives'...
Towards the last bit, i understand the idea that you can use time as asset against luck in business, but it also reeks of survivorship bias. What are the chances that a kid in a village in Uganda with a "good business model" will ever be the CEO of an S&P 500 company as opposed to Mark Zuckerberg's daughter? Even a lifetime cannot overcome circumstantial luck. The mythos of the young visionary working out of their garage to build the next big company are just a pipe dream. Most of the modern brand name entrepreneurs were at least upper middle class if not outright wealthy before they even had an idea. The amount of connections and start put capital that alone can get you cannot be understated.
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Great episode, a throwback to Ep 200 where I remembered how Professor Fama spoke about the difficulty of estimating the expected returns of alternative assets due to data opaqueness and the self-selectivity. Great to see an episode about it!
Superb podcast once again. Occasionally showed pictures are really useful.
Ben Felix, "I like learning but I don't like having fun", hahaha
I really like the new format.
Great stuff
Dynamic Beta investments has two (US) ETFs that attempt to replicate hedge fund returns using an automated strategy that sounds like it might be similar to what was mentioned in this episode.
DBMF (managed futures) and DBEH (hedge strategy).
What I get from this... outside of some super specific hedging strategy, there's little incentive for a "normal" investor to waste time with alternatives'...
Towards the last bit, i understand the idea that you can use time as asset against luck in business, but it also reeks of survivorship bias. What are the chances that a kid in a village in Uganda with a "good business model" will ever be the CEO of an S&P 500 company as opposed to Mark Zuckerberg's daughter? Even a lifetime cannot overcome circumstantial luck. The mythos of the young visionary working out of their garage to build the next big company are just a pipe dream. Most of the modern brand name entrepreneurs were at least upper middle class if not outright wealthy before they even had an idea. The amount of connections and start put capital that alone can get you cannot be understated.
That’s why I asked the question about luck. We have an upcoming guest on luck and the myth of meritocracy so it has been on my mind.
-Ben
yo real life