The source of alpha

January 23, 2010

illiquid (long term, less marketable)

unconventional/inconvenience (geographical IFC/OPIC, out-of-run issues, ultra low latency)

complexity (regulation, hard to price)

value (evaluation, margin of safety, patience, this words in combination with liquidity)

value creation ( improved management(forestry, corporate, urban planing, (potential)celebrity, (potential) network effect, prop technology)

size ( fill bathtub with teaspoon)

out-of-favor, contrarian ( GMO out of favor, this is not in strict sense a source of alpha, but …)

outright inefficiency (Sallie Mae stock conversion)

Information ( cap < 1b, no coverage)

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