Nassim Taleb Makes Billions and Attacks Richard Dawkins

Quote from Greg Richards:

So he claims, but what does that have to do with the returns? But as I say, he lets representations and rumors of wealth bleed into the market, so it seems he may care very much about the appearance of great wealth, but middle class may have been the reality. My point is that the representations bear scrutiny. Now he is involved with a fund once more, so the questions are fair. Instead of facts and answers, one gets incomplete information on Wikipedia and excuses about health scares instead of audited returns for Empirica.

While this may mean nothing, or it may mean he is simply embarrassed about underperformance and doesn't want to bring it up, now that he is associated with a fund, more transparency is in order. Again, while it may be nothing, and there may be verifiable explanations, they haven't been provided. These issues are red flags for anyone doing due diligence.
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no question. good points. most fund managers talk their book, from soros to the little guys-- if given the chance.

surf
 
Quote from Corey:

For a man who talks all day about our inability to predict, he sure does make a lot of predictions...
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apparently he acted on the predictions making a world class fortune...

surf:D
 
Quote from marketsurfer:

apparently he acted on the predictions making a world class fortune...

surf:D
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Perhaps he himself is now being fooled by randomness...
 
Quote from sjfan:

Sorry, his hedge funds shut down because of poor performance? that's news to me
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Obviously I meant Empirica...

"Taleb DID bleed theta on his options trades. His hedge fund had the same PnL as a fund that goes out and buys a boatload of lottery tickets every month, telling investors that their lucky break is comming any minute now.

My understanding on Taleb's HF was that investors didn't like the monthly bleed while they were waiting for that tail event payoff. Taleb was basically buying insurance, and that's not free."

Anyhow, others already explained the rest...

For extra credit:

" So after the fund starting grinding out losses, Nassim started calling his fund a 'hedge', not a fund, later, a 'laboratory'. Now he says about the fund:

`Our aim was not to make money,'' Taleb says. ``I make no claims of being able to beat markets.'

But he makes sure any article that mentions his fund notes he made 60% in 2000. The only record of his total fund was a WSJ article on him in 2007, which notes he lost money in 2001 and 2002, made single digits in 2003 and 2004. That averages out to around 12%, and as the risk free rate was about 4% over that period, and the volatility was probably around 17% on a monthly basis, thats a Sharpe of 0.47. Not so good. And that's with his unaudited returns, so it's probably biased high (people have a tendency to round unaudited results upward significantly)."
 
Of course he's bleeding theta. That's the whole point isn't it. Looks like the investors didn't do asset allocations right. Funds like Empirica - and there are several - aren't suppose to make a steady x% a year; they are supposed to make nothing, and then do great when every one else is in the crappers. Several of them (not run by taleb) did extremely well last year. Bloomberg had a few articles about it.

But I will agree that since it was shut down, we'll never know whether that fund truly had alpha or not.

Quote from Pekelo:

Obviously I meant Empirica...
My understanding on Taleb's HF was that investors didn't like the monthly bleed while they were waiting for that tail event payoff. Taleb was basically buying insurance, and that's not free."
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funds like nt's are designed for a very small percentage of ones capital. this is not old lady investing or IRA buying--- the ultra rich and some institutions allocate a small percentage to these "get richer fast" products with the full knowledge of the downside.

surf
 
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