Comments on: “Peak Alpha” Theory: Perspectives from Around the Blogosphere http://allaboutalpha.com/blog/2006/10/07/peak-alpha-theory-perspectives-from-around-the-blogosphere/ Hedge funds, portable alpha, 130/30 and alpha-centric investing Fri, 19 Mar 2010 07:52:26 +0000 http://wordpress.org/?v=abc hourly 1 By: Richard Wilson http://allaboutalpha.com/blog/2006/10/07/peak-alpha-theory-perspectives-from-around-the-blogosphere/comment-page-1/#comment-33529 Richard Wilson Thu, 18 Oct 2007 03:52:58 +0000 http://allaboutalpha.com/blog/2006/10/07/peak-alpha-theory-perspectives-from-around-the-blogosphere/#comment-33529 I think it is true that most hedge funds don't feel threatened by new entrants. Only the most traditional who are really more scared of their own inability to create alpha are usually scared. I think it is true that most hedge funds don’t feel threatened by new entrants. Only the most traditional who are really more scared of their own inability to create alpha are usually scared.

]]> By: Alpha Male http://allaboutalpha.com/blog/2006/10/07/peak-alpha-theory-perspectives-from-around-the-blogosphere/comment-page-1/#comment-41 Alpha Male Wed, 11 Oct 2006 21:53:26 +0000 http://allaboutalpha.com/blog/2006/10/07/peak-alpha-theory-perspectives-from-around-the-blogosphere/#comment-41 Point well taken. More participants mean less alpha per participant. I wonder if more participants also lead to more aggregate alpha in the long run? Intuition would say "no" because increasing liquidity should reduce inefficiency. But not necessarily when there are commensurately more niche and emerging markets to play in. In any event, you're absolutely right that all the important lessons about investing we probably learned from our parents. ;) Point well taken. More participants mean less alpha per participant. I wonder if more participants also lead to more aggregate alpha in the long run? Intuition would say “no” because increasing liquidity should reduce inefficiency. But not necessarily when there are commensurately more niche and emerging markets to play in.

In any event, you’re absolutely right that all the important lessons about investing we probably learned from our parents. ;)

]]> By: rckang http://allaboutalpha.com/blog/2006/10/07/peak-alpha-theory-perspectives-from-around-the-blogosphere/comment-page-1/#comment-40 rckang Wed, 11 Oct 2006 19:45:54 +0000 http://allaboutalpha.com/blog/2006/10/07/peak-alpha-theory-perspectives-from-around-the-blogosphere/#comment-40 Alpha Male Your comments are great; the blogsite is totally unique. Kudos on your work. Some clarification on your conclusion to the above piece. Whether you or I are more bullish on the future of active management, that is debatable but overall not of any significance. I think what we can agree on is that the art/science of active management is tough. The game is the ongoing search for new sources of alpha (your comparison to oil is spot on) as alpha becomes "betaed". You say "new sources of alpha will always come online to replace them" however I don't think we're in a Soros/Trout/Robertson world anymore. The environment is so different (number of participants, speed of capital movement, etc.) that although new sources of alpha may be available, the opportunity for investors to fully participate in its exploitation is unclear. In my opinion, the issue is not the aggregate size of alpha but the actual true alpha realized by each participant. Didn't our parents always say nothing worthwhile was ever easy? Alpha Male

Your comments are great; the blogsite is totally unique. Kudos on your work.

Some clarification on your conclusion to the above piece. Whether you or I are more bullish on the future of active management, that is debatable but overall not of any significance. I think what we can agree on is that the art/science of active management is tough. The game is the ongoing search for new sources of alpha (your comparison to oil is spot on) as alpha becomes “betaed”. You say “new sources of alpha will always come online to replace them” however I don’t think we’re in a Soros/Trout/Robertson world anymore. The environment is so different (number of participants, speed of capital movement, etc.) that although new sources of alpha may be available, the opportunity for investors to fully participate in its exploitation is unclear. In my opinion, the issue is not the aggregate size of alpha but the actual true alpha realized by each participant. Didn’t our parents always say nothing worthwhile was ever easy?

]]> By: Sunday links: proxy investing revisited « Abnormal Returns http://allaboutalpha.com/blog/2006/10/07/peak-alpha-theory-perspectives-from-around-the-blogosphere/comment-page-1/#comment-32 Sunday links: proxy investing revisited « Abnormal Returns Mon, 09 Oct 2006 15:18:35 +0000 http://allaboutalpha.com/blog/2006/10/07/peak-alpha-theory-perspectives-from-around-the-blogosphere/#comment-32 [...] All About Alpha pulls together a number of items on the question of “peak alpha.” [...] [...] All About Alpha pulls together a number of items on the question of “peak alpha.” [...]

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