The traditional notion that private investments are risky and public investments are safe is evolving. Previously, private equity, venture capital, and hedge funds were deemed risky while publicly traded stocks were seen as safe. However, the landscape is shifting with a new perspective. The speaker highlights the concentration of risk in the S&P 500, with 10 stocks representing a significant portion and trading at high Price-to-Earnings ratios. This challenges the notion of public investments being inherently safe. The speaker notes that the distinction between public and private investments is blurring, emphasizing that liquidity, not the classification, determines risk. High net worth individuals and institutional investors are encouraged to consider the trade-off between liquidity and compensation for less liquidity. The speaker advises assessing the need for immediate liquidity and structuring portfolios to accommodate less liquid investments prudently.
Marc Rowan, co-founder and CEO of Apollo Global Management, joined Tyler to discuss why rising interest rates won't hurt Apollo's profitability, why liabilities have traditionally been the weak spot in insurance, why the concept of liquidity needs a rethink, the meaninglessness of the term "private credit", what role crypto will play in American finance, why Marc bought a brutalist apartment, which country has beautiful new neighborhoods, what motivated Apollo's office redesign, what he looks for in young hires, the different kind of decision-making required in debt versus private equity, the biggest obstacle to doing business in India, how university governance can be improved, what he's learned from running restaurants, the next thing he'll learn, and more.
Read a full transcript enhanced with helpful links, or watch the full video.
Recorded February 5th, 2024.
Other ways to connect