The financial media is full of the news that Philip Parker of Altair Asset Management - a fund manager variously described as a "star" and a "veteran" - is liquidating all assets in the funds he manages, and will return the proceeds to investors as believes the current environment for equities and property is excessively risky. In the meantime he will take a year off.
On one hand he should be congratulated for putting investors' interests first, rather than "charging our clients fees when there are so many early warning lead indicators of clear and present danger". However if his prediction is proved correct, it should be a fair warning to all those investors who have happily given their money to other index, long only or ETF fund managers, that they have some sleepless nights ahead.
Alternatively, had his investment mandate provided sufficient flexibility, he could manage the downside risk with index put options, which intelligently and appropriately managed could not only manage the downside risk of a sharp fall across all equity or property prices, but also potentially provide significant upside reward.
Meanwhile not only has he captured the headlines, it seems he may in fact be part of the catalyst to cause the very sell off he's predicting, and if so it will be interesting to see if investors at large, including his own, will thank him. Plenty of long short or alternative managers however may well do as those are just the conditions they are designed for.
