It’s natural perhaps, if you’re in the business of alternative investment, with your own alternative stock rating, alternative capital structure, and alternative pay-grade — that you have the urge to come up with alternative names for very un-alternative things, like trying to pick stocks that are going to go up.
Witness Fortress Investment Group, the New York-listed alternative manager, with $36bn under its respected belt.
Henry McVey, chief US investment strategist at Morgan Stanley, has agreed to join Fortress as a managing director, leading its “new business efforts focused on deep value public equity investing.”
Deep value public equity investing? That sounds suspiciously like the business of buying out-of-favour stocks that should come good in the long-term. It sounds suspiciously like the business equity fund managers have been involved in the world over for as long as equity markets have existed.
It sounds like old, well-worn, investment hat — long-only value investment.
While McVey is quite a name, and quite a catch for Fortress, the Morgan Stanley man will be adopting a client fee structure that will make his job rather taxing. The great masters of value investment — men like Warren Buffett — have struggled to achieve annualised rates of much more than 20 per cent over the years. And they never dreamt charging their clients 2 and 20.
Whatever McVey’s talents, this smacks of selling investment mutton dressed up as financial spring lamb.
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