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Do Gurus Follow Their Own Advice? (w/a note on Snowball's portfolio)

edited September 2011 in Fund Discussions
Hi Guys,

Is guru advice to be trusted? Does the chef eat his own cooking? In most instances it is heartening to see experts practice what they preach. Too often that is not the case.

It is fitting to challenge a financial advisor by asking if he invests in the products that he recommends or endorses. There are both hard and soft interpretations for this common scenario and their likely replies.

In many instances an affirmative reply would considerably increase confidence in the recommendation, and command more mutual trust. However, in other instances, because each investor has his own special objectives, priorities, portfolio plan, and risk tolerances, a negative response is equally acceptable.

Several recent postings highlight the apparent disparity of endorsements with perceived actions. I was motivated to prepare this posting after reading the Forum exchanges on these subjects. More on this matter later.

Searching for a causal-effect relationship between two observed parameters is a respected and an honored scientific research tool. However, it must be applied sensibly; an indispensable constraint is that a logical coupling must exist that reasonably explains why the independent parameter influences the behavior of the dependent parameter. That coupling is a mandatory requirement. When that linkage is distorted or completely abandoned, the output is often Junk Science. There are both good correlations and bad correlations. A solid researcher knows the difference.

Carefully executed Data Mining has contributed significant discoveries that have advanced our investment knowledge base. I have personally developed an attractive correlation between corporate profits and GDP growth rate; that’s an illustration of useful data mining. Data mining need not be a pejorative. Unfortunately, it has also been extensively misdirected to produce meaningless, junk correlations.

All savvy investors are familiar with at least three such egregious examples of data mining misuse. You likely remember the false correlations between butter prices in Bangladesh, between women’s skirt lengths, between Super Bowl outcomes, and the expected return from the S&P 500 Index as a proxy for the equity marketplace. Since only correlations that historically reproduce the data collection period with considerable fidelity are reported, they obviously work – at least for that data period. The issue is, do they remain viable in the future? They work until they stop working. That’s the nature of poorly executed data mining exercises.

A mutual fund learning lesson from a poorly performed data mining study was documented in the James O’Shaughnessy 1996 book titled “What Works on Wall Street”. It was touted as “a guide to the best-performing investment strategies of all time.” The method used a multiple parameter regression modeling of conventional fundamental stock ratios to define a portfolio of anticipated superior performing equity positions.

The book was a huge success and made O’Shaughnessy instantly famous and wealthy. A mutual fund was designed based on the study and sold to the public intending to exploit the study’s findings. In a few years it failed after some minor early successes. The procedure worked until it stopped working.

Recently, a portfolio from vintage FundAlarm archives has been resurrected on this Forum. You may recall that when it was assembled it was called the MMLL portfolio. It was designed to be conservative, with dampened volatility and forgiving response in market downhill periods as its primary attributes. Those are exemplary goals. It does exactly that. Of course, in an expansive marketplace environment, the MMLL portfolio will likely underperform. There are no free lunches.

The portfolio was proposed and constructed by a departed participant from these discussions; he used the sobriquet Fundmentals. I am sure many remember that Fundmental did not invest in the well diversified, multi-holding portfolio that he cobbled together. It includes bond holdings. He made no claims in that direction since he freely posted his own portfolio components. Fundmental’s portfolio was highly focused, often in energy products, and not diversified. His personal portfolio properly reflected his investment style. By nature, he believed in a momentum investing philosophy, and applied a sector rotation strategy as an implementation tool. That’s okay because that’s a representation of his investment profile.

He constructed this more diversified portfolio as a service to Forum members. At the time of its construction it was based solely on a careful review of recent, past mutual fund performance. He exclusively used a rearview mirror approach when assembling the portfolio. He correctly postulated that the diversification would provide protection during an equity market meltdown.

From Fundmental’s perspective, it was a paper exercise. He did not eat that portion of his cooking. If you trust his investment acumen and research diligence, you might consider investing in his MMLL portfolio; but remember that he did not have a pony in that race. As always, the individual investor must make his own decisions in his quiet deliberations. Fundmental was serving as a financial advisor who did not eat his own cooking in that capacity. Personally, I am not alarmed by that observation.

A second minor eruption has emerged from a fund review that David Snowball published many months ago. The posting analyzed the merits and shortcomings of the Nakoma Absolute Return Fund (NARFX). Some Forum members interpreted his summary as an endorsement of the fund. It is not; it is simply for informational purposes.

The report is a very detailed and an attractive fund review. I certainly understand why some Forum participants glommed onto NARFX. Unluckily, it has generated disappointing returns; too bad, but those are the risks and uncertainties that exist for all investment products, especially glitzy ones.

Surely no member of this Forum imagines that Professor Snowball commits resources to all the mutual funds that he assesses in a positive way. I do not recall David ever stating or even implying that he owned NARFX. If he did follow that nutty policy, his portfolio would be hopelessly distorted with scores of highly correlated holdings. That’s not a portfolio grounded in firm diversification principles. That’s not what Professor Snowball is about.

When making a personal portfolio selection, I am convinced that David uses a sharp scalpel, and not a hatchet. Again, if you choose to buy a fund based on a favorable Forum review that it your prerogative. The factoid that David does not eat his own cooking in this instance should not sway you one way or the other; it does not matter whatsoever. He is providing data in an appealing format that allows Forum members to make more informed decisions. You judge if he has an iron in the fire. I don’t think it matters.

As investors we must always be alert and be skeptical of all investment advice. In many financial circles the term “guru” is a polite substitute for the word “charlatan”. Peter Drucker was one such individual who made that connection. So care must always be exercised. Much of what is reported, what is spoken, and even what is written is simply hogwash.. It has no gravitas to anchor it.

Investment advice is frequently faddish-driven. At various times, buy-and-hold, sector rotational, or momentum tactics are the Lion Kings of portfolio management strategies. The current favorite fad changes with shifting investment winds, usually reflecting what worked in the most recent past. One thing is certain; it will change again – and soon.

As an independent investor responsible for your own successes and shortfalls, a huge dose of skepticism is always a prudent quality. A charlatan will always present an outstanding record. That record has been prepared by a disingenuous selection of facts, or a judicious choice of timeframe, or is totally a fake. Good research must dig deeper to expose the actual, not merely the claimed, data sets. Also prudence demands that a judgment must be made of the purveyor’s character, motives, and honesty. Trust in the messenger is mandatory.

The cautionary warning is simply this: Don’t fall victim to the mad ranting of an unscrupulous profit seeking guru. They are masters to their goals first, yours are a distant and unhappy secondary consideration. The good news is that separating the good and the ugly investment gurus demands the same skill set that is needed to assess candidate active mutual fund managers. We have considerable experience with that task.

What do you think?

Best Regards.


  • edited September 2011
    Before anything else: "As an independent investor responsible for your own successes and shortfalls, a huge dose of skepticism is always a prudent quality." I agree with that quite a bit (especially the first part), although I'm shocked with the near-complete lack of skepticism that I've seen over the last couple of years after what happened in 2008. Anyone who was slightly skeptical or negative was shouted down, without question.

    Otherwise... not the most clear way of stating it, but what I've discussed on the boards falls close to what I own, is what I own or at least falls within my way of thinking/is something I would own if I was interested in that sector if I am not currently.

    I will say that the example portfolios I have recommended to others on this board are generally "light" versions of my views, working in my viewpoint but allocating in a more broad/somewhat more conservative fashion. I would not recommend anyone older/near retirement (which is a large portion of the board, I think) allocate/invest in exactly the same manner that I do, but I do work in what I believe to be themes I have a strong belief in.

    As for NARFX (which will apparently now become something else at some other fund company), it is a mixture of Hussman's recent stubbornness on overall, broad macro views and Heebner's recent mis-timing on micro views. Owned it early on, sold it early on when this became clear (I *think* it was short oil or something along those lines in 2008 early, then I believe got out of that early and still didn't make money in 2008. The fund has mis-timed other bets - early or late - ever since.) The people behind NARFX seem very nice, but the fund tripped up after the first year or so and never got out of its own way since. More complex/alternative strategies are certainly not at all a bad thing or something to be avoided, but simply the fact remains that there are few retail products in this area that pull off these strategies consistently and/or well (and some simply don't have the flexibility to pull off the complex strategy fully.)

    As for Heebner, I think (and thought at the time) that CGM Focus was truly over when Jim Cramer called it his "favorite mutual fund" on Regis and Kelly one morning.

    Additionally, anyone who invests in a fund because David writes a review (overview is probably a better term) of it (and I do think his overviews are terrific) and then becomes displeased is silly. These overviews are "building blocks" for research into a fund, and very good building blocks they are. I certainly did not expect David to invest in everything he gives an overview of, but wouldn't be surprised if he was invested in some of them.
  • edited September 2011
    You're exactly write about reading my profiles: these are not recommendations for anyone to buy a particular fund nor a signal that I'm buying them. Most profiles close with either a statement of skepticism or a recommendation to for a particular type of investor ('folks looking for a conservative core holding") add it to their due-diligence list. Whenever I own, or intend to purchase, a fund, I try to flag that fact.

    For what interest it holds, I've got three portfolios: very conservative (which we have in lieu of a savings account), moderately conservative (my non-retirement holdings) and moderately aggressive (my 403b and Roth). In general, the very conservative funds avoid equities and the moderately conservative ones have mandates which give their managers some flexibility about where to invest. Only about 5% of the very conservative portfolio is investing in stocks, which about 40% of the moderately conservative one is. That latter estimate changes as the managers shift their equity allocations, of course.

    Here are the funds in the first two, in order of their weight in the portfolio:

    Very conservative (up about 3.5% YTD):
    T. Rowe Price Spectrum Income (RPSIX), a fund of funds with low expenses and about a 15% equity stake
    Hussman Strategic Total Return (HSTRX), increasingly a bear market fund given H's performance on down-market days
    Bank savings account, mostly a holding pen of sorts.
    RiverPark Short Term High-Yield (RPHYX), a particularly low volatility fund which I'm test driving as a cash-management alternative

    Moderately conservative (down about 3.5% YTD):
    T. Rowe Price Spectrum Income (RPSIX), see above
    Leuthold Global (GLBLX), marketed as "Leuthold Core goes global," this is a quant-driven, fairly pricey fund that can invest anywhere, in pretty much anything, long or short. Its been about the strongest of the Leuthold stable since launch.
    Matthews Asian Growth & Income (MACSX), a singularly low-volatility way to invest in Asian markets, occasionally invests heavily in convertible securities
    FPA Crescent (FPACX): another go-anywhere fund whose manager scours a corporation's finances to determine where (if at all) to invest, from their stocks and bonds to convertibles and loans.
    Artisan International Value (ARTKX): solid, large-cap GARPy, from the folks who also manage Artisan Global Value
    Artisan Small Cap Value (ARTVX), my oldest holding and one that has thrived in an array of markets.
    RiverPark Short-Term High Yield (RPHYX), my newest and smallest holding, also above.

    I've profiled about 120 funds for FundAlarm and/or the Observer. Of those, I have non-retirement investments in Leuthold Global, RiverPark Short-Term High Yield, Hussman Strategic Total Return, and Matthews Asian Growth & Income. I had a small investment in Utopia Core, which crashed and liquidated.

    Getting into my portfolio is durned difficult, because I'm not interested in expanding the number of funds I own (dilutes performance, complicates record-keeping) so there needs to be an open spot. That results if (1) a current holding implodes (Utopia Core, sigh), (2) a new opportunity set emerges (the called HY bonds are an example, but master limited partnerships or e.m. local currency debt would also qualify), (3) a manager I own launches a new, more-interesting fund (I'm on the bubble about Artisan International Value versus Artisan Global Value) or (4) my needs - and hence my target asset allocation - change.

  • Reply to @scott: In a recent Show, Jim Cramer has recommending S&P 500 Index fund in a 401k. I was truly shocked initially butI understand why he said what he said.

    - Perhaps, he was trying to motivate long term investment in a 401k as opposed to his mad money trading...
    - Perhaps he chose S&P 500 Index fund as it is available in most 401k plans. Besides, he did allude that tracking active funds and managers is too much work for most people.
    - Also, he fund recommendations in the fast did not pan-out very well. So, he is trying to avoid the risk of picking a fund that performs the market badly.
  • edited September 2011
    David is doing a good job profiling new funds or under the radar funds. However, 100% success is rather difficult. I did invest in a few funds that David had profiled based on my further analysis and the fit to my own portfolio. While David had articulated in favor of some high expense funds, I generally could not stomach the expense ratios to give a shot to these funds. Others do.

    BTW, you mentioned NARFX but forgot the big flop on, now defunt, Utopia Funds which badly underperformed and failed completely to deliver. David was very enthusiastic on these funds and even invested himself as far as I remember. The managers were very articulate and had delivered interesting insights in their commentary but failed in their strategy. Thus the funds were liquidated.

    I was an investor in Utopia Growth fund (UTGRX) for a period and it fit small value fund category for my portfolio. At the time, most of the better known Small Value funds were closed. So, I took a chance on this fund and made an active bet and failed. It did underperform index funds. This is the risk with active management. It is a good lesson to remember. I do not blame David for this.
  • Reply to @Investor: I think Cramer has changed somewhat in the last couple years after the "Bear Stearns" incident (among many other things), which he talked about during a near-fight with Simon Hobbs (and I wish Cramer had gone after Hobbs with much more fury than he did) the other day (

    I still disagree with Cramer at times, but I do like the fact that he appears to be trying to evolve and adapt to a market that's increasingly difficult and where the kind of volatility that's been seen is only going to lead to further outflows, which has been seen in the ICI numbers. (Just 25 out of 1004 months over the past 83 years have experienced higher realized volatility than August 2011 -

    I think people have to be invested, but the average person (or, in Cramer terms, "the home gamer") is not going to stick around.

    This is a generalization, but I think what's really required is financial education from an early age - personal economics (and investing can fall under that) rather than home economics in HS. Giving people the building blocks to research and then make informed decisions about investing, rather than simply hitting the sell button when things get as they are. I'd rather the serious Cramer that you see early in the morning be the Cramer you see on "Mad Money" (which I think was one of the John Stewart criticisms), but then it might not get the ratings it does.

    " tracking active funds and managers is too much work for most people. " Suze Orman in one of her recent specials essentially said that people have to do their homework for their investments and if they don't like it, too bad.

  • Reply to @Investor: For what it's worth, I've been agonizing about the Utopia profile for about four years. My original profile was exceedingly skeptical, my revised profile was exceedingly supportive. The funds, briefly, performed well and then sucked mightily. They liquidated without a word of explanation to their investors and refused to respond to emails asking for clarification.

    I might (or might not) have learned four things from the experience: (1) beware of purely opportunistic funds - Utopia had no clearly defined strategy beyond "exploit undercovered investments too small for other firms to exploit."

    (2) Be sure that the guy with the track record is the guy running your fund. FIM's president had great success using this strategy on separate accounts, brought into two portfolio managers and gave them charge of the funds. Something similar is true in the case of Auer Growth (about which I was pretty skeptical) where Auer Sr. made money using the strategy in his retirement account and Auer Jr. ran it as a mutual fund.

    (3) Be skeptical of folks with great success in separate accounts, but no track record in funds. A lot of advisory firms have splendid separate account composites, but those composites might represent as few as a dozen investors (though some range into the hundreds). There's a lot of differences between those two universes and success in one only suggests the possibility of success in the other. I'm willing to give folks like Wedgewood the benefit of the doubt because I can see how their strategy (buy and hold 20 wide moat stocks) transfers; in the case of more-opaque strategies, caution reigns.

    And (4) be cautious in manager interviews. I've only ever interviewed two really dull, uninspiring guys (no, I'm not saying but my profiles reflected those concerns). The rest are all bright, articulate, enthused. There's a risk of getting caught up in that enthusiasm. I try to guard against that by (a) writing the profile first based on an analysis of the record, the fund characteristics and its strategy and (b) asking for an interview only to address questions left unanswered by the record.

    None of that guarantees that I'm right, but it seems to have increased my batting average by a bit. (Whether I'm made it above "the Mendoza line" remains an open question.)

  • Reply to @David_Snowball: David, great retrospect. Thank you.
  • edited September 2011
    Reply to @David_Snowball: I appreciated what I took to be at least some skepticism after your interview with Berkowitz.

    In terms of NARFX, I said several months ago that you're going to see an increasing amount of funds be pulled in by other companies, whether not so good funds (NARFX) or funds that are good, but can't continue to run with their size (Penn Ave Event Driven and Akros Absolute Return taken in by Quaker.)
  • Reply to @scott: Thanks, Scott. I've never interviewed anyone with quite the level of self-assuredness that Mr. B demonstrated. That might be essential if you're going to be bold and run an incredibly focused portfolio. At a personal level, though, I find it disquieting. I am, as a result, not a good candidate for investing in one of Mr. B's funds.
  • FWIW,

    Concerning NARFX:

    On August 17, 2011, the Board of Trustees of Nakoma Mutual Funds (the “Trust”) approved the reorganization of the Nakoma Absolute Return Fund (the “Nakoma Fund”), a series of the Trust, into the Schooner Global Absolute Return Fund (the “Schooner Global Absolute Return Fund”), a series of Trust for Professional Managers (“TPM”). The Board of Trustees of TPM approved the reorganization on August 30, 2011.

    Nakoma Capital Management, LLC (“Nakoma”) serves as the investment adviser to the Nakoma Fund and Schooner Investment Group, LLC (“Schooner”) serves as the investment adviser to the Schooner Global Absolute Return Fund. Both the Nakoma Fund and the Schooner Global Absolute Return Fund have an absolute return investment objective.

    Under the terms of the Agreement and Plan of Reorganization approved by each Board of Trustees, shares held by Nakoma Fund shareholders will be exchanged for shares of the Schooner Global Absolute Return Fund at the closing of the reorganization. At the same time assets held by, and liabilities of, the Nakoma Fund will be transferred to the Schooner Global Absolute Return Fund. Shareholders may, however, purchase and redeem shares of the Nakoma Fund in the ordinary course until the last business day before the closing. Purchase and redemption requests received after that time will be treated as purchase and redemption requests for shares of the Schooner Global Absolute Return Fund received in connection with the reorganization.

    As a result of the reorganization, each shareholder of the Nakoma Fund will become a shareholder of the Schooner Global Absolute Return Fund and will receive shares of the Schooner Global Absolute Return Fund of equal value to their shares in the Nakoma Fund. It is expected that the reorganization will be treated as a tax-free reorganization for federal tax purposes.

    Prior to the reorganization, which is expected to occur on or about November 4, 2011, Nakoma will continue to manage the Nakoma Fund in the ordinary course.

    Shareholder approval is not required to effect the reorganization, but Nakoma Fund shareholders will receive an information statement/prospectus that provides information on the Schooner Global Absolute Return Fund and the terms of the reorganization.

    Please retain this Supplement for future reference.

    The date of this Supplement is August 31, 2011.
  • MJG
    edited September 2011
    Hi Guys,

    Thank you all for your extensive and varied replies. Each of these, in their own way, enhanced and enlarged the topic.

    "Why" an investment decision is made is more vital to understanding and learning than "what" it exactly is. That explanation requires more detailed postings. I greatly appreciate your fine efforts.

    "Why" helps to inspire confidence which ultimately generates trust. Trust is mandatory in a fragile, uncertain investment environment, especially when discussing matters over the Internet. It compliments knowledge which is yet another requisite quality when researching investment options and opportunities.

    When preparing my submittal, and again when reviewing the many superior responses, I was reminded of several pertinent quotes from renown authorities. Here is a formidable triad from folks you’ll recognize.

    From ex-GE boss Jack Welch: “Everytime you meet somebody, you’re looking for a better and newer and bigger idea. You are open to ideas from anywhere.” That searching philosophy makes for a more successful investor.

    From Nicolo Machiavelli: “ Whoever desires constant success must change his conduct with the times.” That’s not a bad maxim for our volatile markets that seem to change in quicksilver time. Sometimes I think you have to be Flash Gordon to keep pace.

    From an earlier posting when I quoted Mark Twain: “It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so.” It is crucial to distinguish between what is real and what is imagined.

    All these mantras emphasize the need for investment learning, adaptability and flexibility. It takes courage to accept that some of your purported investing knowledge was wrong, and/or that circumstances have made that knowledge irrelevant. But in our wild dynamic world today, the courage to change is essential to financial success.

    I am fascinated by Professor Snowball’s reference to "the Mendoza line". For those not familiar with that reference, Mario Mendoza was a Pittsburg Pirate (among others) infielder in the 1970s. He is more or less famous in baseball folklore by fashioning a meager lifetime batting average of about two hundred (his actual lifetime average was 215). That means he was a successful hitter only one of five attempts. Most ballplayers are not tolerated for every long with that dismal batting skill; he must have been an astonishing shortstop in the field. Or, perhaps, he was just plain lucky.

    That’s a miserable record by any measurement standard. I sure hope that David is setting a slightly higher hurdle for his own benchmark. Don’t get angry guys; that’s my poor attempt at humor. I know David sets a more demanding performance standard, and he is succeeding.

    Thanks for your portfolio disclosures David. We all appreciate your continuing commitment and your outsized efforts. Your energy and enthusiasm are truly outstanding.

    Best Wishes.
  • If I were going to vote for the best thread I've read on this board. This is it, should go into the coopertown hall of fame along with Mario Mendoza.

    when you're right you're write.:)
  • Good thread MJG. I always figured that if these folks so smart, what they doin still working and giving away free advice? Would think they'd be sipping pina coladas on some tropical island by now. BTW, Tigers have a Mendoza in veteran infielder Brandon Inge. Batting 190 for the season, partially spent in the minors, he belted a 2-out homer in bottom of 9th yesterday to win the game. Never can tell!
  • We should have another thread where we share 3-5 right calls (whether specific funds/stocks or broader calls) we've made and 3-5 wrong calls.
  • This is a very useful thread with a lot of important points. I am only a casual investor, and people who are new to the mutual fund world need to know that it can be very rewarding but also have its pitfalls.

    When I read these fund reviews, you can't help but think that almost every fund profiled is the greatest idea ever and a must-buy. But this is to be expected, because David is only going to profile those funds that are noteworthy in some way. I would not expect him to waste time profiling funds that nobody should be buying.

    I got this "must buy" feeling back when I read about the Nakoma and Utopia funds as well. It must have been years since I read the Nakoma review, but it was so vivid that I still remember that apparently there is some college in Wisconsin that consistently churns out investment gurus. I had a similar feeling about the Utopia funds.

    I didn't buy either of the funds because my portfolio could not accommodate it. I was very disappointed at the time. I am glad they have done poorly, but not because I dodged a bullet. Rather, they are a good reminder that this site is a resource, nothing more (albeit a very good one). None of the profiled funds are a sure-thing. There are so many choices out there that nobody should feel bad passing up on any fund.
  • For those investors who are considering working with and advisor, as well as those who do, I would urge all of them to ask the advisor to show them what THEY are invested in. Understandably, the specific investments and allocations will vary from advisor to client, since time horizon, risk tolerance, and goals may be very different. But there should be some similarity of holdings, since I strongly believe advisors should eat their own cooking. We routinely show prospetive clients our own account holdings, if for no other reason than to demonstrate that we believe strongly in what we preach. We recommend mutual funds and ETFs to our clients, and that is what we own in our own accounts.

    That being said, there are a lot of investment options, and one should remember that what I have in my own portfolio might not be appropriate at all in someone else's. My own allocation is pretty aggressive...always has been...and many folks would never handle the volatility of some of the individual holdings. Have I made some investing errors? Of course. But that's part of the learning process. I hope that age increases wisdom!
  • Good thread.

    I didn't invest in NARFX b/c I already had funds in that space. One of them is AARFX, which I thought would be a good singles hitter. But this fund has underperformed for some time. I have had a very lengthy phone conversation with the manager Brady Lipp and was quite impressed. Every other time that I've called a mutual fund, I've only been able to speak to a low level answering service that can barely quote the prospectus. But these guys offered to setup a meeting with the portfolio manager. Brady was very open with me about the funds current positions and their basis. I was pushing him hard to explain why they became a loaded fund and Quaker -- obviously to generate more AUM, which hasn't been working and I'm not even sure why it would work. Maybe more advisors would encourage the now loaded fund. Brady explained that he has a hedge fund for friends and family (I found this very interesting. Usually its a hedge fund manager that has a mutual fund for friends/family and these guys were doing the opposite). Brady explained that they thought they had a unique offering and displayed some seemingly genuine altruism. I also questioned the viability of the fund with such low AUM. They have 6 employees and Akros capital is owned 25% by angel investors. They did not act as if they were on the ropes, but what do you really expect them to say. They are trying to increase AUM and advertise their product. I'm not sure how much longer, I am willing to stick with them. Since I've owned the fund it has gone from 5 stars to 3 stars. I believe it is one of the most conservative long/short MF's and tries to adjust based on macro views. After mark to market accounting was ended, they repositioned so that they were zero short and 90% invested. They have dialed this back down. Now, they are somewhere closer to 25% short, 75% long, but they have a net cash position around 20%. It is hard to gauge holdings based on websites, because of the options they hold and high turnover.

    Anyway, I can see how it would be difficult to refrain from irrational exuberance when speaking with this guys.
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