Relativity Theory, Money-Time Curvature and Private Capital Pricing

Wonder what relativity theory and money-time curvature have to do with rational pricing of private capital? The two quotes below, freely adapted from the Wikipedia pages about space-time and reference frame, may give a hint.

The Price of Private Funds Is Less Wrong

If Prof. Malkiel had taken his “Random Walk” in Midtown Manhattan, the private capital industry’s enclave, he could have found that prices can be “less wrong” there than down Wall Street – to a level that could offer, over the life of a private fund, reasonable arbitrage opportunities but not without risk.

Private Capital Beta: Theory Reloaded

In a recent Financial Analyst Journal article titled “Do (Some) University Endowments Earn Alpha?” the authors find that endowments mostly fail to deliver alpha and what looks as alpha can be almost totally explained by the inclusion of alternative investments in a static asset allocation. Digging further, the authors find that there is no strong statistical evidence of selection skill relating to the private equity and hedge fund portfolios.