How can the size of managed capital be an absolute limiting factor for sustained alpha, when entities like Berkshire Hathaway demonstrate an annual compound growth of 19.7%, which is a ratio of 1.87 times the S&P 500 over a 60-year period?
This performance differential of 9.2 percentage points over six decades is a significant counterexample that challenges the notion that size reduces opportunities.
Our own experience at GIC shows that large capital can be an advantage for strategic acquisitions and major stakes, disproving a systematic inverse correlation between size and the ability to generate alpha.