Keep pulling the thread on Nick Rohatyn.
Nick Rohatyn believes emerging markets are at an inflection point due to the decline of "U.S. exceptionalism."
A backtest of a multi-asset strategy in emerging markets over the last 15 years shows that correctly selecting the best-performing asset class in each of 20 countries 60% of the time would have resulted in only one year of negative returns.
In 2013, The Rohatyn Group acquired Citigroup's $4.3 billion emerging market private equity business, CVCI, as banks were divesting such units due to severe capital treatment under post-crisis regulations.
Nick Rohatyn predicts that any mid-sized, single-strategy (monoline) emerging market asset manager will inevitably fail due to the market's violent and unpredictable cycles.
For a period, 81% of all private investment capital flowing into emerging markets was concentrated in China.
Nick Rohatyn's view is that China has transitioned from a top investment destination to being "uninvestable," and is now considered a short-term trade rather than a long-term investment.
Over the last 15 years, there has been an enormous concentration of capital flowing into the United States at the expense of all other global geographies.
Nick Rohatyn's goal for The Rohatyn Group within the next five years is to grow it into a $50 billion to $150 billion asset manager focused on emerging markets.
Nick Rohatyn believes that the era of U.S. hegemony as the primary magnet for global capital is over, creating a target-rich investment environment in emerging markets.
Nick Rohatyn believes there is currently no global leader in emerging markets asset management capable of providing comprehensive guidance to allocators on strategy, asset class, region, and timing.
In emerging markets, scenario analysis is a more effective risk management tool than standard deviation-based models because historical crises have often been six-sigma events.
In the 3-4 years following the 2008 financial crisis, 95% of all new capital allocated to hedge funds globally went to firms with over $5 billion in AUM.