Other People's Money with Max Wiethe Can Alpha Capture Save Fundamental Long/Short Equity? | David Stemerman CenterBook Partners
Nov 18, 2025
David Stemerman, CEO and co-founder of CenterBook Partners, dives into the challenges facing fundamental long/short equity investing. He highlights the decline in fund launches yet believes in the potential of alpha capture to revitalize this space. David discusses how direct partnerships with single managers can enhance portfolio strategies, while addressing the common criticisms surrounding alpha capture. He also shares insights on how to align manager incentives with allocator needs and the importance of maintaining independence in the investment process.
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From Lone Pine To CenterBook
- David started as a bottom-up stock picker working with Steve Mandel at Lone Pine and ran Kanatus Capital.
- That background shaped his belief in stock-picking skill and led to founding CenterBook.
Hidden Alpha Behind Market Noise
- Bottom-up stock pickers generate meaningful alpha that is often masked by market beta and factor exposure.
- CenterBook isolates idiosyncratic returns using risk models to deliver a cleaner alpha stream to allocators.
Partnering With Independent Managers
- Buy-side alpha capture exists but CenterBook uniquely partners with independent managers to build systematic portfolios.
- Their model emphasizes protecting contributors while harvesting and scaling stock-picking signals.