Man Group CEO on lock-ups and alpha…
|Dec 5th, 2007 | Filed under: CAPM / Alpha Theory | By: Alpha Male||
With considerable debate ranging about Ranjan Bhaduri’s “Balls in the Hat” game (see related posting), Peter Clarke, the CEO of behemoth hedge fund manager Man Group apparently told a conference audience today that hedge fund lock-ups will bring institutions more alpha. This, according to Thomson Investment Management News.
This might surprise players of the balls-in-the-hat game because while lock-ups do bring more returns (ceteris paribus), it’s not likely “alpha”. Instead, it’s more likley just a fair market compensation for locking yourself up and throwing away they key.
In fact, Clarke didn’t actually say lock-ups “will bring institutions more alpha”. According to Thomson, he actually said:
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