Thanks Jason for your equally long feedback.

I wasn't nitpicking on their quarterly or monthly performance, we are talking about 16 years of track record and a statistically significant pattern. I imagine myself being their client, I really need great timing ability in order to really enjoy the value added by EQR, i.e. putting in money in 2000, 2001, 2002 & 2008 (4 out of 16 years or 25% of the time). If I'm a dollar-averaging client of theirs, I don't get much out of it (especially if I only discover them after 2002).

I need to add that my comments have nothing to do with their investment process but rather purely from the angle of results. I understand that fund managers should always focus on process, not results, but over time results are products of process and the pattern could tell us a lot about the managers. I actually respect, or in fact admire ACR's process (based on the article), but if their long term results don't add significant value to their clients, something must be wrong somewhere.

There might be many definitions of absolute return. I'm personally influenced by David Swensen's way of approaching absolute return. At Yale, they seek to generate absolute returns with low correlation to the market. In other words, they actually don't mind lower returns compared to the index, but they seek consistency with very little market risk. As how Paul Singer put it in to words, "We try to make money all the time."

If I'm a potential client who seeks out absolute returns, I wouldn't want to put money with them because (1) EQR hasn't been meaningfully beating the market since 2003; and (2) their performance has been reasonably correlating to the market, hence exposing to market downturn that might destroy my absolute returns. I must give credit to them for their terrific performance in the first 3 years as those were absolutely absolute returns, i.e. gaining 71% while the market losing 39% = enormous outperformance and no correlation to the market whatsoever, but that's no longer the case since 2003.

On portfolio concentration/diversification, if rules don't allow, they should market themselves as a concentrated portfolio manager.