Jeffrey McLarty

In-case you can’t tell I have an incredibly amazing obsession with the capital markets.  Passionate.  I believe anybody else that blogs about stocks or the markets, does as well.  Now what would happen if these passionate people all got together and used their powers collectively, to run a fund?  A fund run by bloggers.  The team would also have the added leverage of being geographically spread out, I think that’s good.

It could work like this:  Every manager has the power to nominate a stock, as well as quantity, and limit price.  Everybody votes, and unless it’s unanimous (or like 4 against 5) we don’t buy.  We would have two choice how to run it, we could average the quantities in every-one’s vote, as well as the limit purchase prices, or we scale in using everyones votes as separate orders. Cash management and degrees of leverage (if any) would be continually taken into consideration of every vote we cast, Hypothetically we would end up only buying the best ideas and we would more able to pick a smart purchase price.   There could be bonuses tied to the performance of your cumulative votes.  This is all open to discussion, but the ironic part is, we could run this idea (either paper trading, or the real thing) through a blog.  We all get a login and password, and write posts to nominate a stock, or a list of stocks.  Then in the comment thread the other managers vote.  With a committed team, we could easily test out this idea…so, I’m taking names of who is in.

With fund of funds out there, not that I’m positive on this, but a $20M fund, I want to believe is easy to get off the ground. Set a high water mark of like 18%, take 0.25% off the base and 10% of gains after that.  We could easily afford a 5 to 10 person team, each could easily make $20K - $40K the first year, and well, 3 or 4 years down the line, let’s just say ~$30K quickly becomes negligible.  The fund would grow quicker, because we have the power to get the word out about it.  Social Leverage. 

Not sure how many people are as crazy as I am, so, I’ll be taking names for as long as it takes - could be a month - could be a year.

So for now, who is in to at least try this out on paper?  Reply to this post, if you’re interested, and make sure you have a link to your blog.