Quote from Nattdog:
I think the mean spirited critics miss a few points. The admiration for Victor that many have is not based on his having a recent hot hand. it is not based on the personal decisions he makes about with regards to the risk profile of his fund and the consequences of such.
From an investors perspective, one could invest 100 in a low risk fund, or 25 in a high risk fund.. If the exposure is the same, the high risk fund is often better: from a fee perspective, risk perspective, and opportunity cost perspective.
Victor is on of the few, true, original and pioneering people in this field who has chosen to freely share much knowledge with others. He has great generosity of spirit and is a great teacher.
The aggressive posture of his fund and the consequences in times like this August do not change the fact that he pioneered approaches that have been copycatted and pirated, and to a large extent build certain aspects of the modern hedge fund industry. This is aside from the many individuals, myself included, who have carefully studied his writings and found them to be of high value. Victor teaches and exemplifies approaches that build universal knowledge aid in the development of independant, first hand knowledge.. which is critical to markets or any other dynamic field.
Victor plays the game his way. He certainly could have build an institutional style fund, aimed for a bit over the risk free rate, and built an asset management fee-pig of a business. I would guess he would have ended up richer, soaking up those stable mgt fees.
But, that just does not seem to be his style. Victor is an intellectual, who I guess may enjoy the process of testing the limmits of an idea more than the humdrum aspects of business, as important and critical as they may sometimes prove to be. That is his style and his choice, and I for one admire him for it.
