Ben Gilbert: belief

Transcript context

…The way that some folks we talked to described the difference between the institutional funds and Medallion to us is that Medallion’s average hold time for their trades and positions is (call it) a day, maybe a day-and-a-half. Whereas the average hold time for the institutional funds positions is a couple of months. Across 4300 stocks in the portfolio, there’s a lot of trading activity that happens on any given day, but it’s a lot slower in any given name than Medallion would be, which makes sense. Again, it gets back to this slippage concept. If you have a bigger fund and you’re investing larger amounts, which the institutional funds are, you can’t be trading as frequently or all of your gains are going to slip away. And frankly, it just looks a lot like the S&P 500. When you look at as of November 2023, so 11 of the 12 months of the year had happened, they were up 8.6%. That sounds like an index type return. You look at the first 4 months of 2020, right after the crazy dip from the pandemic, they were down 10.4%. Less than the broader market, but they still were a mirror of the broader market. I think the RIEF, their institutional fund, yes it works as expected. No, it’s not Medallion. If it were standing on its own, there’s zero chance that we would be covering the organization behind it on Acquired. Zero percent chance. Speaking of the fund—that is the reason why we are covering this company on this show—we set up during the tech bubble crash, the volatility is when Medallion really shines. Well, there are no more volatile periods than 2007 and 2008. 2007 Medallion does 136% gross. 2008 Medallion does 152% gross. Get out of here. This is 2008 while the rest of the financial world is melting down.…

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