Episode summary
The Dirty Secret of ‘Top Quartile’ Funds (Goldman Sachs' Kristin Olson Explains)
The Meb Faber Show
· · Hosts: Meb Faber · Guests: Kristin Olson
Summary
Kristin Olson said Goldman Sachs’ alternatives platform now oversees more than $600 billion, and she defined alternatives broadly as anything outside public equities and public fixed income. She argued that the asset class has shifted from being mostly institutional to a much wider base of individual investors because private companies are staying private longer, growth is increasingly happening in private markets, and clients want access to that growth.
She said the current mix of interest is moving around the alts landscape. Venture and growth are drawing attention because AI is accelerating innovation, while secondaries have picked up as a source of liquidity for private equity portfolios with longer holding periods. Infrastructure is also seeing renewed demand, especially where data centers and power needs intersect with AI. At the same time, she said traditional buyout fundraising has been softer.
On returns, Olson stressed that manager selection matters more than ever. She said top-quartile and second-quartile private equity managers have meaningfully outperformed, while average portfolios have barely beaten global equities. She also warned that evergreen private credit and other semi-liquid structures can create false comfort, since quarterly liquidity is subject to gates and investor sentiment can accelerate redemptions.
Key takeaways
- Olson said Goldman Sachs’ alternatives business manages over $600 billion and includes private equity, real assets, private credit, and hedge funds.
- She argued the biggest opportunity in private markets is access to private growth companies, especially AI-related venture and growth names.
- Olson said secondary strategies have benefited from slower distributions and longer private equity holding periods.
- She warned that evergreen private credit vehicles are not truly liquid and can gate redemptions when sentiment turns.
- She said top two quartiles of private equity managers have delivered roughly 600 basis points of alpha versus global equities, while average managers have barely outperformed.
Notable quotes
“think of anything that's not public equities or public fixed income and that can all kind of then fall into that alternatives bucket”
“we have over 600 billion in alternatives aum”
“Secondary funds have the ability to step in and really capitalize on this current dynamic”
“semi-liquid is a term that's used and we we don't like that term because we don't like putting the word liquid in there”
“you want to make sure you pick the top two cortiles of managers”
How the episode opens
Welcome to the Met Favor Show, where the focus is on helping you grow and preserve your wealth. Join us as we discuss the craft of investing and uncover new and profitable ideas, all to help you grow wealthier and wiser. Better investing starts here.
Met Faber is the co-founder and chief investment officer at Camry Investment Management. Due to industry regulations, he will not discuss any of Camry's funds on this podcast. All opinions expressed by podcast participants are solely their own opinions and do not reflect the opinion of Camrian Investment Management or its affiliates.
For more information, visit cambrianvestments.com.
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Today's guest is Kristen Olsen. Kristen is global head of alternatives for wealth at Goldman Sachs, was named to the firm's management committee earlier this year. In her role, she oversees the global alternatives platform and alternatives product strategy across wealth client businesses and last year she was named one of the 100 most influential women in US finance by Barrens.
She started her career at Goldman in 1998. Kristen, welcome to the show.
Thank you. Thanks for having me, man. — 98 that was a party.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- top quartile funds
- alternatives market growth
- private credit volatility
- manager selection due diligence
- ai in portfolio construction
Companies and tickers mentioned
- Goldman Sachs
Watch the episode
Watch “The Dirty Secret of ‘Top Quartile’ Funds (Goldman Sachs' Kristin Olson Explains)” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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The Meb Faber Show, this episode and its artwork belong to The Idea Farm. Octagon is not affiliated with the show; this page is an independent summary.
