Many people saying hedge funds are an asset class. This is an incorrect take. Hedge funds are the strategy of writing a covered call on a manager’s future performance and paying theta for the privilege.
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had a talk with an allocater rethinking their preference for performance fees because the dispersion in performance among their managers was so great in 2020 that as a whole they both underperformed their benchmark by the most ever and paid their biggest performance fee ever.
A basket of options is worth more than an option on a basket! Many over-diversified institutional allocators out there selling baskets of options way too cheap.
