"Aug. 30, 2015 8:54 am ET - The recent market rout caught some star Wall Street traders by surprise. But not a hedge-fund firm affiliated with “The Black Swan” author Nassim Nicholas Taleb, which gained more than $1 billion on a strategy that seeks to profit from extreme events in financial markets."https://www.wsj.com/articles/nassim-talebs-black-swan-fund-m...
"April 8, 2020, 11:28 AM EDT - Nassim Taleb-Advised Universa Tail Fund Returned 3,600% in March"
https://www.bloomberg.com/news/articles/2020-04-08/taleb-adv...
short_sells_poo|5 years ago
Universa is not a traditional fund, it is a so called "premium spend" structure. With a traditional fund, you give them money, and they try to make some profits. At a later time, you can retrieve the profits and original investment.
With Universa, you give them money as you would to an insurer, that is, you cannot back that original investment back, you only get the profits they make on it. It is literally insurance premium.
This is a very important distinction because when returns are traditionally quoted, they are not based on the premium the fund spent buying financial instrument, but the total capital invested. In the case of Universa, their assumption is that you'll spend 3% of your capital with them as insurance premium. It is therefore much more clear to quote the returns based on the capital insured, which results in a much more modest (although still great) 120%