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Publisher's Summary
In March 2006, the world's richest men sipped champagne in an opulent New York hotel. They were preparing to compete in a poker tournament with ­million-dollar stakes. At the card table that night was Peter Muller, who managed a fabulously successful hedge fund called PDT. With him was Ken Griffin, who was the tough-as-nails head of Citadel Investment Group. There, too, were Cliff Asness, the sharp-tongued, mercurial founder of the hedge fund AQR Capital Management, and Boaz Weinstein, chess "life master" and king of the credit-default swap.
Muller, Griffin, Asness, and Weinstein were among the best and brightest of a new breed, the quants. Over the past 20 years, this species of math whiz had usurped the testosterone-fueled, kill-or-be-killed risk takers who'd long been the alpha males of the world's largest casino. The quants believed that a cocktail of differential calculus, quantum physics, and advanced geometry held the key to reaping riches from the financial markets. And they helped create a digitized money-trading machine that could shift billions around the globe with the click of a mouse. Few realized that night, though, that in creating this extraordinary system, men like Muller, Griffin, Asness, and Weinstein had sown the seeds for history's greatest financial disaster.
©2010 Scott Patterson, Random House

Like most funds scott owns, I'm intrigued by this one...AQR Risk Parity AQRIX (or AQRNX), a hedged, dynamic global allocation fund.
Its approach must appeal to the mathematician in me. That of trying to hold a certain level of volatility while seeking total return through a dynamic allocation across diverse investment types. An attempt to mitigate near-term capital loss that is inevitable in the business cycle, but tough to swallow for the typical investor, even if that same investment will gain twice as much down the road...on the other end of the cycle. AQRIX is a fairly new fund that suggests perhaps modern trading tools may make such an attempt more successful than the typical 60/40 allocation funds.
I like that AQRIX has done well since inception against other formidable established offerings, like PIMIX, MFLDX, BBALX, VWIAX:

I like that AQR discloses fund manger investments and other account responsibilities.
I like that its four managers are invested in the fund:
John Liew, Ph.D from $100,001 - 500,000
Brian Hurst from $100,001 - 500,000
Michael Mendelson from $500,001 - 1,000,000
Yao Hua Ooi from $1 - 10,000
I like that Liew holds degrees from University of Chicago where he remains is a trustee. That Mendelson holds three degrees from MIT (can you believe?), including one in mathematics. That Hurst and Ooi are Wharton School grads. That the three senior managers did time at Goldman Sachs.
I like that the expense ratio is under 1% and the fund has attracted healthy amount of assets at $825M. The fund has hedge-fund like flexibility without the attendant 1%/10% or even 2%/20% fees.
I like that AQR's website offers a lot of information about the fund, including a downloadable Excel spreadsheet of current holdings.
I do not like that AQR appears to have launched 7 new funds within the past year, nearly doubling the portfolio of publicly managed funds, which is now at 16. I understand from an article in WSJ that the Greenwich, Connecticut-based firm built its reputation managing hedge funds for wealthy and institutional investors. It stumbled like many others in 2007/8 as the credit crunch hit, but quickly recovered.
I do not like that two other AQR international public funds, AQIIX and AQGIX, where Mr. Liew is shown as a participant but not principal manager, have under-performed their benchmarks. The principal manager of those two funds is Cliff Asness, who along with Liew, started AQR Capital Management in 1998. The other AQR fund where Liew appears as principal manager is the heavily hedged Multi-Strategy Alternative Fund ASAIX, and while young, it looks to be doing ok compared to its benchmark.
And, I guess, I do not like that Affiliated Managers Group now owns a minority stake AQR Capital Management, but I know that seems to be the way of things these days.
Overall, there is a lot I like about this new fund AQRIX and, honestly, about AQR. I will probably take up a position soon. That said, I'll remain sensitive to AQR Capital keeping investors first in its quest to grow their firm.

Nice. MWCRX has done well since inception, and on par with other larger and established high yield bond funds, like the gold rated SPHIX at Fidelity, as shown below:

Just go in eyes wide open. Roll back a few years and you can see how this category of investment can quickly lose more than 20%:

But I like Tad Rivelle's attitude, reflected in the Barron's article you reference. When asked "What is the role of a bond-fund manager when the party ends?" Mr. Rivelle responded:
The foremost role of a bond-fund manager always is to protect capital, to keep himself and his clients out of trouble. It is going to get miserable at some point. There will be a rising-rate environment, with people flying headlong out of a variety of asset classes. The circumstances are always different, but that is always the case.
One other thing, just make sure its 2.86% EP keeps getting subsidized until it grows in assets.