3 ms·

If the guy generating alpha keeps most/all of his above-market alpha, then that means there's none for me to get or keep, right? I can't see how that's attract

• Lazare 12y ago
  That's the point. An ability to reliably beat the market is like having a goose that lays golden eggs. If the ability exists at all, it's certainly very rare. And if you are one of the people who has it, why would you hire that ability out to other people? The guy who owns the golden goose is going to sell the eggs, not rent the goose out. Or if he did rent the goose, it would be for an amount no lower than the expected value of the eggs because otherwise he's losing money. But given these dynamics, that means that there's no reason to think that if you see some guy offering to rent a golden goose it would be a great deal for you. I mean, he's actively trying to price it so it's not, and it's his goose, so he's probably right.