Ep4 "Making Bad Investments Profitable" with Pete Briger
All Else Equal: Making Better Decisions
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How Do We Know Who the Best Managers Are?
When the money manage return drops to that return, then everybody's indifferent. So obviously, if i see a marriager do well, i'm going to ubtate my expectation. I'm going to think to myself, ok, the marriage is better than i thought he was. And i'm not the only one doing tat everybody gets to observe the returns. But just be clear about that, when the money flows in, the size of the fund grows. We've already established this decreasing returns to scale. So the return drops. And what is drop to drops to the vanguard expected return. Simily, for the bad managers, money flows out, so that their returns
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