In this episode of the Odd Lots podcast, hosts Tracy Alloway and Joe Weisenthal interview Ronan Cosgrave, a partner at Albourne Partners, to delve into the intricacies of multi-strategy hedge funds, also known as pod shops. The discussion covers the differences between traditional 2 and 20 multi-strats and pod shops, focusing on the impact of compensation structures on risk management, talent retention, and overall fund performance. Cosgrave explains how pod shops, with their individual P&L structures for portfolio managers (PMs), can sometimes lead to costly diversification and increased leverage compared to traditional hedge funds. The conversation also explores how allocators assess these funds, the importance of cultural alignment within the firms, and the challenges of maintaining true diversification amid market trends and correlation risks.
