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> Besides, a proper CIO's pay is tied to getting good investment returns [...] Q: What happens to the typical CIO and his/her package when returns aren't "good

> Besides, a proper CIO's pay is tied to getting good investment returns [...] Q: What happens to the typical CIO and his/her package when returns aren't "good" ?

WalterBright 7y ago
Fired.
- akiselev 7y ago
  With a golden parachute.
  - WalterBright 7y ago
    Golden parachutes are not decided on after the fact. They are agreed upon in advance when they are hired. The only reason companies offer them is to get the best people they can. The person running your investments can make or break you. You're going to hire the best you can, and that's going to cost. And someone with a track record of making it rain is going to know this and know what they're worth. If you want a golden parachute yourself, you're going to need to build a track record of success first showing you're worth it.
    - namdnay 7y ago
      > And someone with a track record of making it rain I think you kind of summed it up there... There are better things for a university to be doing than paying rainmakers
      - ChrisLomont 7y ago
        >There are better things for a university to be doing than paying rainmakers Dozens of university endowments are over a billion dollars, with significant returns when under good management. Ignoring the returns possible on that means the students and state has to pay more to continue the university. Endowments often consist of hundreds or more fund, usually set up by donors, to advance some part of the university, which very often is scholarships and other direct student benefits. It's incredibly short-sighted to downplay them without understanding the benefits.
        namdnay 7y ago
        Good management is one thing. Rainmakers are another. I’m not sure why a university needs someone actively managing funds instead of using passive vehicles
    - logifail 7y ago
      > The person running your investments can make or break you How would one propose to distinguish* someone who will deliver growth for - say - 25 consecutive years from someone who delivers growth for 5 years yet blows up your endowment in year 6 ? * beforehand ;)
      - WalterBright 7y ago
        Their track record.
        logifail 7y ago
        > Their track record If you think that "25 years of not blowing up" is a sure-fire way to predict the risk of blowing up in year 26, I would recommend reading Nassim Nicholas Taleb.
        WalterBright 7y ago
        I never said "sure-fire" or anything like it. Anyone who believes in "sure-fire" investments is a fool. The theory that people with lots of money to hire the best are fools doesn't seem credible to me. Besides, Warren Buffet has a stellar track record much longer than 25 years. People paying him to manage their money has made him very, very rich and those people very happy with him.

> Besides, a proper CIO's pay is tied to getting good investment returns [...] Q: What happens to the typical CIO and his/her package when returns aren't "good" ?

WalterBright 7y ago

Fired.

akiselev 7y ago
With a golden parachute.
- WalterBright 7y ago
  Golden parachutes are not decided on after the fact. They are agreed upon in advance when they are hired. The only reason companies offer them is to get the best people they can. The person running your investments can make or break you. You're going to hire the best you can, and that's going to cost. And someone with a track record of making it rain is going to know this and know what they're worth. If you want a golden parachute yourself, you're going to need to build a track record of success first showing you're worth it.
  - namdnay 7y ago
    > And someone with a track record of making it rain I think you kind of summed it up there... There are better things for a university to be doing than paying rainmakers
    - ChrisLomont 7y ago
      >There are better things for a university to be doing than paying rainmakers Dozens of university endowments are over a billion dollars, with significant returns when under good management. Ignoring the returns possible on that means the students and state has to pay more to continue the university. Endowments often consist of hundreds or more fund, usually set up by donors, to advance some part of the university, which very often is scholarships and other direct student benefits. It's incredibly short-sighted to downplay them without understanding the benefits.
      - namdnay 7y ago
        Good management is one thing. Rainmakers are another. I’m not sure why a university needs someone actively managing funds instead of using passive vehicles
  - logifail 7y ago
    > The person running your investments can make or break you How would one propose to distinguish* someone who will deliver growth for - say - 25 consecutive years from someone who delivers growth for 5 years yet blows up your endowment in year 6 ? * beforehand ;)
    - WalterBright 7y ago
      Their track record.
      - logifail 7y ago
        > Their track record If you think that "25 years of not blowing up" is a sure-fire way to predict the risk of blowing up in year 26, I would recommend reading Nassim Nicholas Taleb.
        WalterBright 7y ago
        I never said "sure-fire" or anything like it. Anyone who believes in "sure-fire" investments is a fool. The theory that people with lots of money to hire the best are fools doesn't seem credible to me. Besides, Warren Buffet has a stellar track record much longer than 25 years. People paying him to manage their money has made him very, very rich and those people very happy with him.