Not saying she didn't give him info, but she didn't do the actual trades. He's an investment manager.
> Paul Pelosi, investment manager and the husband of House Speaker Nancy Pelosi, purchased up to $11 million worth of mega-cap tech stocks in May and June, according to a financial disclosure form filed last week.
Maybe. Or maybe by nature of his relationship he gets approached more for interesting opportunities?
Is Dr Dre an amazing talent scout, or was he out and about and by nature of his own fame approached by artists such that he could pick the obvious good opportunitie? Or maybe both apply?
Perhaps having money, power or fame is an attractor of opportunities all on its own.
It doesn't have to be that, but "better than average consistently" doesn't mean much to me when the person is already not average in a few other aspects.
That only really matters if you think he can't see good from bad at all. Even if he just ignored most and only acted on things that looked phenomenal, he might see more of those than the average person.
Roughly 9 out of 10 hedge funds fail to beat the market or simple passive strategies indexed to it. I'm no fan of Pelosi personally, but observing her husbands performance isn't smoking gun evidence, it's just banal.
Also, consider that a lot of what hedge funds offer is bespoke risk profiles to high net wealth individuals that are overexposed to particular market sectors.
I think this has probably been one of the worst times to compared hedge fund performance to other strategies. Let's see if the corrections happen for real and then calculate those returns. After all market was or is at all time high.
We have already seen it. In 2020, you saw macro funds (the ones often targeted for "underperforming") that were running max drawdowns of 5% make 20%, 30%, 40% in a few months.
The issue, as you imply, is that in a bull market people lose almost all ability to exercise reason and view the opportunity cost of capital as the S&P.
But a lot of hedge funds aren't running high levels of beta, and investors in their funds don't demand that (unf for some hedge funds, who demanded low vol and then went into index funds when beta did well).
And, ofc, most equity hedge funds have had very strong performance. All the Tiger group hedge funds have private companies, everyone owns tech companies, you are even seeing value hedge funds in FAANG stocks...it is quite something.
This is wrong on all levels. Banality and evidence don’t sit across a spectrum. Hedge funds largely don’t offer sector exposure for balancing purposes in the general, and neither in this specific case. Paul Pelosi runs a diversified investment portfolio, not a hedge fund.
Yeah every time someone comes defending this despicable human being who had got filthy rich in last 40yrs saying it is her husband, I just shake my head and ask when are these people going to retire? How much is enough for these people?
Ah yes. The classic mega insider trading of... buying Apple stock. Yes, only the most non-obvious and insiderest trading ever imagine. Next you're going to accuse me of "insider trading" for moving all of my assets into the ARKG when it became clear COVID-19 was going to be declared a pandemic.
Would that be an issue if it was owned through an S&P 500 fund?
I would agree that options look suspicious, even if they are not "short dated out of the money" types.
But mega cap stocks are lot harder to manipulate than some tiny obscure company.
I think I read that Barack Obama put all his savings into government bonds while he was in office, which is admirable and maybe it would be good to mandate high level people all do that.
But if we don't have such a law, it doesn't seem too far out if they own the same big companies that almost everyone who invests in the stock market does.
Before accusing Mr. Pelosi, at a minimum, I think it would be relevant to check how much different his investment returns were from an index of the entire stock market.
I think there have been Republicans that were overzealously accused of insider trading during the beginning of the pandemic too. I forget who, but there was a fuss made about several of them and Matthew Levine dissected some of the claims in his column and didn't think there was much there.
The returns don't matter. The conflict of interest matters. If you commit insider trading but wind up losing money you are just a sucky criminal.
Blind trust is the only acceptable option. It's been tradition for Presidents through most of my lifetime. Trump didn't do it and it was rightfully a big shit storm.
Government officials should not be allowed to spend government funds at or write regulations for companies they own.
Pelosi and indeed all of Congress has non-public information about laws, government contracts, etc. Right now they can and do trade with this "insider" information. Legally this is not considered insider trading. Congress wrote the legal definition of insider trading in such a way that excluded their insider knowledge. There is no value in arguing the semantics of this so I won't address it further.
The traditional solution for this glaring conflict of interest that is used for Presidents is a blind trust. Most Presidents put their wealth in a blind trust to avoid even the potential of a conflict of interest between their actions as President and their personal wealth. Trump did not do this and it was a shit storm. He even tried to get the government to rent out his resort for some UN thing. Presidents and Congress should all be required to put their wealth into a blind trust to avoid conflict of interest.
> Paul Pelosi, investment manager and the husband of House Speaker Nancy Pelosi, purchased up to $11 million worth of mega-cap tech stocks in May and June, according to a financial disclosure form filed last week.
Doesn't every diversified fund in the world own "mega-cap tech stocks"? And most probably bought during May and June because their increased value meant they took a larger proportion of indexes, and index-following is a pretty widely used strategy.
You don’t even need to know insider information about companies to make smart decisions if you a family member of Congress especially the leader of the entire Democratic Party, which currently controls the house, senate, and presidency. You only need to know what laws are likely to get passed in advance and consider how that will effect companies. Helps to have the person who leads and publicly threatens other democrats for their vote on items.
Yeah, but take the random trades of 435 people and a normal distribution is still going to have a top (and bottom!) outlier. It's certainly reasonable to assume an investment manager (her husband, who is making most of the trades) might be part of the reason to be such an outlier.
And even discounting that and looking for shenanigans, well..."she timed buying NFLX almost perfectly" with a purchase a month before it was announced they were going into the video game space; why the heck would she have known that? That isn't related to legislation, that isn't something they would have gone to the government for; that would be a purely business decision by Netflix. How the heck would she know about it?
I mean, I'd be all for politicians having to put any investment money into blind trusts, sure. But that's different than saying they're insider trading.
Returns alone mean nothing to evaluate an investment strategy against an other. At the _very_ least you would need to compare with the same level of volatility.
That Reuters article you referenced does not say that he traded on insider information. It says that Paul Pelosi may have gotten access to an IPO based on Nancy's position (although that is disputed by Pelosi who says that access was applied for in the standard manner through his broker). That's very different from insider trading.
https://unusualwhales.com/i_am_the_senate/pelosi