AQR Capital Management Founding Principal John M. Liew is a fan of taking the long view and of diversification.
An article the Greenwich resident co-wrote for The Journal of Portfolio Management focusing on “target-date funds,” — a portfolio with an asset allocation mix that becomes more conservative as a retirement or other target date approaches — highlighted the dangers that can arise when diversification and long-short strategies are ignored or underplayed.
Liew, worth an estimated $1 billion, according to Forbes, and his colleagues at AQR have written many scholarly articles and have been favorably compared with leading academics.
But, “You would be surprised at how much effort it takes to turn the academic into the practical,” Liew noted in a Barron’s magazine interview. “Making money for clients involves controlling costs, managing risks, and building real portfolios. Academic work is just the tip of the iceberg.”
Fun fact: Liew applies long-short strategies to his personal life too. In December, Liew and his wife, Serena, bought a three-bedroom condominium on the 45th floor of the Waldorf Astoria Residences in Chicago, according to the Chicago Tribune.
They bought the half-floor condo — with 3½ bathrooms, 10-foot-high ceilings and an upgraded kitchen, custom millwork and hardwood floors, with two terraces and 180-degree city and lake views — as a pied-à-terre that will let them visit family in the area.
The condo seller paid $3.15 million in 2011 for the residence, according to the newspaper. He first listed it for $4.3 million in 2017 and reduced its price eight times over the next three years before taking it off the market.
Liew and his wife ended up buying the residence for only $2.4 million.
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