http://www.timelessinvestor.com/2017/04/27/use-index-to-shor...
From the article:
> When Mr. Yip cast a critical eye on regional malls’ debt in 2015, the CMBX 6 index was trading near its full value, implying a very low probability of defaults.
> Mr. Yip visited malls in Connecticut, Louisiana and elsewhere while on work trips and vacations, sometime taking his family along with him.
> He would walk three times around each shopping center, studying its mix of stores and chatting with store owners, workers and shoppers.
> He noticed some malls seemed poorly maintained and outdated, with a high concentration of mom-and-pop shops that, he figured, probably weren’t paying much in rent. Locally owned stores such as these have less staying power than stores that are part of national retail chains.
The above might be one of the better descriptions of what it can be like to be a hedge fund manager. Just like Steve Carrell's team in "The Big Short" going out to Florida and Vegas to talk to house owners and see empty subdivisions for themselves, the real world job of managing money is alot less sexy than I think alot of people believe it to be.
It's a lot of work going down avenues that end up as dead ends only to find a single potential winning idea after 6 months of work.
This guy's team had to get the hypothesis, and then do the leg work, think things that don't scale, and then even though they think they are right, you still need to find out a way to short shopping malls.
Before today, I've never heard of the Markit index CMBX 6, I'm pretty sure they spent alot of their time just finding the correct vehicle to short shopping malls with and even with this it's not a great one to one match for their thesis, but its as good as they could get.
As heard at one poker tournament that was filled with mostly hedge fund employee's. "So many good shorts, so few reliable ways to short them."