Ep72 Alternatives vs. Mutual Funds: Where Should You Put Your Money

Ep72 Alternatives vs. Mutual Funds: Where Should You Put Your Money

In the rapid-moving world of delegated money management, it is important to recognize the differences in how mutual funds and alternative assets operate. When it comes to alternatives, how do these funds wind up with strong incentive contracts for the money managers as opposed to flat fee contracts more commonly seen in mutual funds? Why do managers of alternatives cap their fund sizes when it could potentially lead to lower fees?

On this episode, hosts and finance professors Jonathan Berk and Jules van Binsbergen examine the key differences between mutual funds and alternatives, by unpacking research in a new paper co-authored by Berk.

The conversation covers performance fees, persistent alpha, limits on capital, and the key liquidity distinction between mutual funds and alternatives.

Read “A  Unified Theory of Delegated Capital Management” by Jonathan Berk and Peter DeMarzo here: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=6019667

Find All Else Equal on the web:

https://lauder.wharton.upenn.edu/allelse/

All Else Equal: Making Better Decisions Podcast is a production of the UPenn Wharton Lauder Institute through University FM.


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Episoder(93)

Ep65 "Will Future AI Systems Operate Like The Human Brain? It’s Complicated” with Jeff Hawkins

Ep65 "Will Future AI Systems Operate Like The Human Brain? It’s Complicated” with Jeff Hawkins

With growing concerns over whether or not AI will take away jobs and eventually become superior to human intelligence, maybe it’s time to take a closer look at the human brain and discover how AI will...

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Ep64 "Why Higher Education Needs a Massive Overhaul: Are the Kids Even Learning Anything?" with Bryan Caplan

Ep64 "Why Higher Education Needs a Massive Overhaul: Are the Kids Even Learning Anything?" with Bryan Caplan

While a higher education may help your career in terms of income, how much of what you’re taught in a classroom actually prepares you for the work you do on the job?Hosts and finance professors Jonath...

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Rerun: Ep53 “The Truth About Inflation and Price Caps: Learn From Argentina” with Veronica Rappoport

Rerun: Ep53 “The Truth About Inflation and Price Caps: Learn From Argentina” with Veronica Rappoport

It’s the final episode of the summer season and with some key mayoral races coming up this fall, we’re revisiting our conversation on inflation with Veronica Rappoport, a former official at the Centra...

27 Aug 202526min

Ep63 “What Explains the Growth of Private Equity? A Different Perspective” with Ludovic Phalippou

Ep63 “What Explains the Growth of Private Equity? A Different Perspective” with Ludovic Phalippou

Private markets have taken off in the last couple decades, with more investors opting to invest in private equity and debt instead of public markets. But what caused that shift? And are the private ma...

13 Aug 202535min

Rerun: Ep60 “A Trade Deficit? More Like a Capital Surplus” with John Cochrane

Rerun: Ep60 “A Trade Deficit? More Like a Capital Surplus” with John Cochrane

For the summer season, All Else Equal will be alternating between new episodes and reruns. In this week’s episode, we’re revisiting our conversation with Senior Fellow of the Hoover Institution at Sta...

30 Jul 202528min

Rerun: Ep59 “Why Tariffs Are Not The Ultimate Trade Weapon” with Dani Rodrik

Rerun: Ep59 “Why Tariffs Are Not The Ultimate Trade Weapon” with Dani Rodrik

For the summer season, All Else Equal will be alternating between new episodes and reruns. In this week’s episode, we’re revisiting our conversation with Ford Foundation Professor of International Pol...

16 Jul 202532min

Rerun: Ep55 “The Future Of The MBA: From 3 Top Business Schools” with Madhav Rajan

Rerun: Ep55 “The Future Of The MBA: From 3 Top Business Schools” with Madhav Rajan

For the summer season, All Else Equal will be alternating between new episodes and reruns. In this week’s episode, we’re revisiting our conversation with Madhav Rajan of the University of Chicago Boot...

2 Jul 202532min

Rerun: Ep54 “The Rise And Fall of Great Societies: Lessons from History” with Victor Davis Hanson

Rerun: Ep54 “The Rise And Fall of Great Societies: Lessons from History” with Victor Davis Hanson

For the summer season, All Else Equal will be alternating between new episodes and reruns. On this week’s episode, we’re revisiting our conversation with historian Victor Davis Hanson.History shows th...

18 Jun 202530min

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