Recently, I had what I think was a very revealing conversation with a hedge-fund portfolio manager. We were discussing the values and virtues of traditional, publicly traded stock and bond investments verses the more private and more privately traded world of alternative investments. The hedge-fund PM really surprised me by stating “as an investor, things that are not publicly traded on a regulated exchange terrify him!” I wondered why this highly sophisticated investment professional (as well as millions of stock and bond investors) mistakenly put so much faith in public markets and the “liquidity” they supposedly provide.