"When investing with other people’s money, which almost everyone — whether fund manager, bank, or family office — does to some extent, the limiting constraint is no longer bankruptcy, but your creditors’ patience. Fund managers whose brilliant investment cases don’t pay off will see their investors gradually pull their money from the fund; banks’ creditors, whether on the wholesale market or through deposits, will refuse to roll over debt or withdraw their deposits.
That mechanism makes succeeding in counterintuitive, unpopular, or deviant investment projections — the kinds that make you serious money — very difficult. Your choice of when to sell can be overruled by your investors if they choose to withdraw funds, forcing you to liquidate assets before your investment case pays off. Your well-researched and brilliant investment case, no matter how prescient, goes up in smoke."