Ever feel like you fell in a rabbit hole? You know, that feeling where you’re the odd one out…where everything around you doesn’t make any sense but no one else seems to notice? Or, maybe you’re stuck asking yourself David Byrne’s inimitable question, “How did I get here?”
Today I was at day two of an industry conference learning about how to interact with high end consultants and present a “value proposition” about alternatives in a way that didn’t use words like private equity, real assets, or hedge funds – you know, words that actually apply to alternatives. I was in a vortex where the panelists advised that instead of telling a prospective investor that my firm invests in real estate, I should talk about downside protection, mitigating risk (apparently different from risk mitigation), and extension risks. Really? That’s better than just showing them some pics of buildings we own?
Don’t get me wrong, I knew where they were going and why they were going there, but it made me think of all these other odd little things that people in my industry run around saying as if anyone has the slightest idea of what they mean. Here’s my favorite: Liquid Alts. I have to believe that whoever coined the phrase Liquid Alts has done his or her fair share of Liquid X. I’d even venture to bet that they coined the phrase while high on Liquid X. You know, “Wow, man, this X is so Alt, it’s almost like a hedge fund that you can get out of at any time.” “Yeah, it’s so out there it’s like alternative beta without exits and entries.” Instead of a “go anywhere fund, it’s a stay nowhere fund.”
Nothing makes me happier than a good convo around options. I absolutely love having options. So, imagine my delight when the speaker actually turned to little old me in the audience and asked me (in front of everyone), “How do you employ the inflation put?”
Uh, I’m sorry, I’m just a little participant at this conference, I’m not supposed to be answering any questions – certainly not questions involving economics! (Read “About the Author” – she didn’t do well in economics! She still wonders where that damned yield curve resides and who decides what it looks like.) So, I wiggled and smiled a little, buying some time to remember my Series 7 chart that told me puts are sold and calls are bought. And then out of some small crevice in the back of my mind comes, “Well, isn’t the real question, ‘Will the real asset exposure give me the inflation put or will rising rates beat the put?’”
I honestly have no clue where that came from, but heads were nodding and facial expressions all seem to suggest that whatever in God’s name I had said was insightful and dare I say, prescient.
Afterwards, speaker and I decided lunch was in order cause we had way too much in common not to get together soon (this deal was sealed when she disclosed having gone to Penn and that she loves Philadelphia.)
We bantered about who will pay for this lunch and I was very tempted to make some quip about buying a put on it, but I figured it was better to quit while I was a (talking) head.