Portrait of a quant

Here is a nice profile (NYT Sunday magazine) of hedge fund manager Cliff Asness. Some time ago, we discussed his research on a modified Fed model for equity valuation. Asness has a PhD from Chicago, and a quantitative style of investing. The article does a good job of explaining how hedge funds caught on with university endowments as alternative investment classes with (potentially) low correlation to the overall market, and good risk-return characteristics. Schools like Yale and Harvard led the way, with spectacular results.

Of being super rich, Asness says "Well, it doesn't suck." For a description of how the Bush tax policies favor the super rich, see here. (Those earning more than $10 million a year now pay a smaller share of their income in taxes than those making $100,000 to $200,000. So much for progressive taxation!)