Top Hedge Fund Returning 45% Under Julian Robertson’s 36-Year-Old Disciple

[Snake Alchemist]

A descendent of Peter Stuyvesant, the last Dutch governor of New York, Coleman was raised in Glen Head, a posh enclave on New York’s Long Island. He went to Deerfield Academy in Massachusetts and then, like his father and grandfather, attended Williams College, where he played lacrosse. He graduated in 1997 and went to work as a technology analyst for Julian Robertson, a godfather of the hedge-fund industry, at Tiger Management LLC, Bloomberg Markets reports in its February issue.

Coleman had a connection at Tiger. He had grown up with Robertson’s son, Spencer, who lived in nearby Locust Valley.

Soon after Robertson, 79, closed his fund in 2000, he handed his son’s former playmate more than $25 million to manage. Coleman was 25 at the time. That made him one of at least 30 so-called Tiger cubs -- fund managers who are Tiger Management alumni. There are another 40-odd so-called Tiger seeds -- funds backed by Robertson dollars.

Coleman and his Tiger Global LP, along with a half dozen others, are both.

http://www.bloomberg.com/news/2012-01-10/chase-coleman-channels-ancestor-stuyvesant-with-45-robertson-like-return.html

I imagine if I was handed this much, I could do pretty well too, but none of my family ever did well enough to leave anything to the next generation.

[rhett o rick]

1. That isnt created wealth, that is stolen wealth. Wealth like that is zero-sum.

Some body(s) lost that amount.

[dmallind]

2. Not at all - somebody perhaps lost the opportunity of that amount - not that amount.

My best recent investment - with a few missing zeroes to this chap's needless to say - was GE that I bought at just over $15 in November. It's up over 25% at time of writing. I have however no way of knowing what the people who sold the stock to me (if you have any GE horror stories, they are irrelevant - this was not an IPO or direct issue preferred stock so GE received not a penny from this) paid for it. It's quite possible they bought in early 09 when it dipped under $10 and are at this point correcting those who think they "lost" the gains I have seen. Instead they made $5 a share and if I sell - which I am contemplating - I will have made $3.80 or so per share.

Of course it's also possible they bought at $40 in mid 2007 and indeed lost their shirts, but at the time they sold - 100% voluntarily of course - they did so expecting the stock would decline and wanting to foist those potential losses on to me. Nobody sane sells a stock they expect to appreciate over the short term.

[rhett o rick]

5. Please see my post #4. nm

[dmallind]

7. Getting it wrong there too.

Who lost in my example? Zero sum specifically cannot apply to openly traded variably priced commodities since there is not a fixed quantity of gain which is divided. Zero sum applies when dealing with a fixed amount is divided between two or more parties - such as royalties vs. publisher profits.

By the way my commissions are 4$ - a negligible percentage of even my decidely middle class investments.

[rhett o rick]

10. Did you ask yourself where that added value came from?

Did the intrinsic value of the stock increase? No, not if it was common stock. The popularity increased. And if you are lucky enough to sell out while the popularity is high, then you win, just like you would picking the right number on roulette. And as long as the overall popularity of stocks goes up, many people will see their stock’s values go up. These increases in popularity are called bubbles and sooner or later they all break. And during these bubbles, it is not zero-sum, but over time, when you include the bubbles breaking, it is zero-sum because no wealth has been created.

I am in way over my head here, but this is how I see it. Best of luck to you.

[dmallind]

11. And that makes it zero sum how?

What increased by the way is the expected future value of the stock. Driven by the very real wealth creation of GE's profitable productive capacity. If GE discovered safe nuclear fusion power this year, the stock would increase in value would it not? Why?

Zero sum has absolutely nothing to do with the creation of wealth anyway - only with how it is divided. There is no fixed value of GE shares so that a buyer automatically gain if a seller loses.

[rhett o rick]

12. Let me ask you this. Are common stock shares related to the actual monetary value of the company?

I might be wrong, but I dont think so. So if GE discovered cold fusion, the actual intrinsic value of common stock shares wouldnt change, but the popularity would skyrocket. Then when it was discovered to be false, the shares would drop.

You are right that there it isnt zero-sum inside a bubble. But that value is fake, false and will go away when the bubble bursts. If you are the lucky one that cashes out while the bubble is on the way up, you win the game. But those poor bastards holding the turds when the bubble breaks lose their asses. Hence, zero-sum. Just prior to the stock market crash of 1929, many people were wealthy ON PAPER. Then the bubble burst and the paper wealth disappeared.

[Snake Alchemist]

3. Not sure that is the case.

I'd rather investments made money rather than lost, but this guy had an unbelievable head start. If I had 25 mil, I would just retire and travel modesty. Guess that's why I'll never be rich.

[rhett o rick]

4. Unless you are buying stocks directly from a company, investing is really

just gambling on bubbles. Some win and some lose. It's zero sum with commissions taken out. And the game is rigged.

[Snake Alchemist]

6. So eliminate the stock market and allow companies to raise their own capital? nt

[rhett o rick]

8. I dont have a problem with the stock market existing as long as they are honest with the public.

It's not an investment in a company when you buy stock on the stock market. It's a bet against the stock value (value is determined by popularity and nothing else) dropping. You are free to gamble in Los Vegas, Native American casinos and the stock market.

[Blue_Tires]

9. Ponzi scheme? Insider info? Gray-area computer programs?

What will bring down this house of cards?