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role is to make sure the person has done the thinking correctly. Ainslie, Och, and Stark also feel they are developing excellent teams. Henry describes himself as a parent watching a child grow up. the rules and procedures are written down, and he observes that they are followed. He may call up a trader and ask, "Are we doing this?" rather than saying "Do this."


A number of the superstar managers have investment committees— senior-level advisory groups broadly responsible for evaluating and overseeing trading policies. Issues include market view, liquidity, capacity, and performance cycles. These meetings are held at various frequencies; they help reinforce a culture.

Cooperman's investment committee meets weekly to discuss macro trends and find out-of-favor asset classes.

The frequency of Griffin's meetings is determined more by the volatility of the underlying stock market. For instance, in 1998 when volatility was high, the committee would meet at least once a day. In 2000, they meet less frequently—perhaps once a week.

Henry, Kingdon, Och, Stark, and Tepper also have investment committee meetings.

Ainslie, Cumberland, Kovner, Rajaratnam, Singer, and Sussman do not hold such meetings. Ainslie points to the dangers of consensus thinking—for example, the more interesting and exciting ideas get weeded out. Furthermore, he wants people focused on their individual stocks rather than looking outside their own industry.

Cumberland's management committee gives risk limits to the portfolio manager—not sector allocations.

Many of the managers hold daily meetings to discuss market movement and development. To name a few—Cooperman, Galleon, Kingdon.


Some of the managers say they allocate to other managers on a selective basis where other managers command an expertise. Doing so diversifies their portfolios, increases potential returns, helps find new ideas, and develops relationships. Kingdon says under 3 percent is allocated to a

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