The Urinal Pitch

So forget about paperwork and administrivia - I need to work on my pitch. And it needs to be short enough so I can explain what I do to an institutional finance board member who's peeing in the stall next to me at the next Gogol Bordello show. Obviously, a likely scenario I need to be prepared for.

What I really do is pretty simple, so let's start simple.

"I use studies on global consumption and carbon output to go long and short global indexes, currencies, green energy, technology, and socially responsible assets. The fund is designed entirely to mitigate risk using the 30 day VIX (S&P 500 volatility measure) and the 30 day VXN (Nasdaq Composite volatility measure). I use fundamental analysis on a macro level, and technical analysis on the micro level."

Um. Ok, so it sounds complicated, but it's really simple. So let's start with some definitions and see if I can work that into something... sayable.

What I'm really doing is looking at two universes. 1.) What I define as a green investment, and 2.) What investors think about the next 30 days in the market. I've defined green more broadly than most. I do it for a few reasons, but the primary is diversification. The secondary reason is that I think I'm right and analysts are narrow minded. That's right, I'm a cocky jerk. Surprise!

But really, green is far more than just individual energy and technology stocks. Green, like everything else, is political, academic, controversial, and above all, a mindset. For example, Brazil does an awesome job of destroying its own rain forests. They are like superhero rain forest chopper downers. But, Brazil is the world leader in Ethanol use, and is far more sustainable as an economy than the United States. So is Brazil "green"? This is where I developed some metrics and scoring systems to decide who is green and who isn't on a macro level (currency and industry).

So that leads us to what investors think. Really, what drives market prices more than what people think? And what is a better indicator of what people think than forward looking volatility? Institutions or retail investors alike make daily bets on how volatile the market will be 30 days from now. Basically, they are betting on a combination of factors: media, fear, market cycles, and personal instinct. So they're doing my work for me! They are telling me that the market is scary or the market is OK. The only trick is to figure out a way to measure how scary or how OK.

When I combine these two things, I get my model and my fund. And I can say:

"I manage a green hedge fund. I use metrics in green industry, sustainable capitalist practices, and market volatility to make long and short investments in a select green asset pool. The fund emphasizes profitability and sustainability while reducing market risk."

Better? Comments? Am I overreaching, a moron, or am I a genius? My vote is always on genius, but it can't hurt to ask.