Public Markets Forgive Mistakes Private Markets Don’t
In this segment, Bob Fraser references a JP Morgan chart from his book that contrasts performance dispersion in public versus private markets. He explains that public markets, exemplified by REITs, exhibit minimal return variation—only about 1.5 percentage points between the top and bottom quartiles—making it easy to “throw money at the wall” and still achieve average results, and virtually impossible for investors to consistently beat the market. By contrast, private markets show orders‑of‑magnitude differences: top performers can double returns while bottom performers may incur losses. Fraser argues that this high dispersion allows knowledgeable investors to differentiate themselves and potentially outperform in private markets, a feat far less attainable in public markets.
