Bill Miller’s a Hedge Fund Guy Now With a Funky Model to Try Out
Long-time Legg Mason money manager using earthquake algorithm
Doesn’t have ‘diddly’ to do with calling markets, says critic
Excerpt
Originally published February 11, 2016 at 5:00am EST
When pitching investors, you normally don’t want “hedge fund" and “earthquake” in the same sentence. But Bill Miller, already known for quirky investing methods, is starting a hedge fund that will make bets based in part on a computer model designed to predict natural disasters.
Called Seismic Value Partners 1, the hedge fund marks Miller’s first foray inthat business after decades managing mutual funds at Legg Mason. He wonapproval last month from the U.S. Securities and Exchange Commission toopen Miller Value Partners, a money management firm that will oversee hishedge funds.
Miller has licensed the model from OpenHazards Group, a Davis, California,company run by engineers, mathematicians, scientists and business people.While many experts are skeptical, the idea is to apply the mathematics offorecasting the probability of seismic activity to the chances of a stockmarket crash […]