Bridgewater gives “alpha-centric” a thumbs-up
| Jun 4th, 2007 | Filed under: Institutional Investing, Media Coverage of Hedge Funds | By: Alpha Male |
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As regular readers will know, we’ve used the somewhat esoteric term “alpha-centric” to describe everything from portable alpha to 1X0/X0 on this website. Sure, it’s a bit awkward, but ”portable alpha” is just one strategy that is enabled by explicitly identifying and manipulating the various embedded components of actively-managed funds (either long-only or hedge funds).
We used the term to describe Bridgewater Associates, one of firms on the vanguard of alpha-centric investing, when they asked their clients to switch to portable alpha last October:
“Like us at AllAboutAlpha.com, CEO Ray Dalio believes alpha-centric investing represents a fundamental re-organization of the investment industry.”
Despite raising the warning flag about hedge fund leverage, Dalio himself also used the term “alpha-centric” recently to describe Bridgewater’s philosophie de la vie. As Money Management, an Australian magazine, reported a couple of weeks ago:
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[...] So says Angelo Calvello of Man Investments in an “institutional investor only” white paper released earlier this year (posted here at AllAboutAlpha.com).  Calvello is one of the instigators of the alpha-centric revolution, using the term “alpha-centric” as far back as 2005 (see related posting).  Acknowledging the operational challenges inherent in a relatively complex strategy such as portable alpha, he now proposes a “bundled” solution that wraps the various components of portable alpha into one entity, such as a special purpose vehicle or a fund).  According to Calvello, this would dramatically simplify the lives of pensions and endowments that are current reticent about diving into portable alpha.   [...]