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But they are playing games with OTHER people's money (aside from the payoff for them) You are playing with YOUR money.
by AtlasBarfed 6y ago
But they are playing games with OTHER people's money (aside from the payoff for them)
You are playing with YOUR money.
- yeezyszn 6y agoYes. And? The alpha dynamics of a liquidity related sell-off are heavily tilted towards folks with locked up capital. Why do you think every manager and their mother has raised a distressed fund?[1] You can have access to that return profile simply by having some capital ready to deploy as an individual, for the reasons I described above. This can add massive alpha. [1] https://www.bloomberg.com/news/articles/2020-06-17/record-number-of-distressed-funds-rush-to-raise-cash-in-downturn?sref=PkIt53hx https://www.bloomberg.com/news/articles/2020-06-17/record-nu...
- CameronNemo 6y agoThe problem is that working class individuals are often in much more vulnerable positions than the capital class. What if I invested a portion of my emergency fund in late march, then got fired in June? Not a great place to be in.
- yeezyszn 6y agoYes agreed, this dynamic exacerbates inequality. No arguments from me there.