Matt Levine, Columnist

Fund Conflicts and Tax Napkins

Also Jesse Litvak, bitcoins and banks, ubercorns and stock buybacks.

April 27, 2017 at 1:15 PM UTC

Matt Levine is a Bloomberg Opinion columnist. A former investment banker at Goldman Sachs, he was a mergers and acquisitions lawyer at Wachtell, Lipton, Rosen & Katz; a clerk for the U.S. Court of Appeals for the 3rd Circuit; and an editor of Dealbreaker.

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Family offices.

If you run an investment firm that invests other people's money, should you also run a different investment firm that invests your own money? The problems are fairly obvious. There are conflicts of interest: If you find a good investment, how do you decide whether to put your money or your clients' money into it? And how do you deal with selling investments from one fund to another? There are attention issues: If you're spending your time on your personal fund, you're not spending it on your clients' fund. And there is a conceptual problem: Why should clients put their money in your fund when you are putting a lot of your own money in a different fund?