Insight from Magnetar
Magnetar took 9 months to set up their shop. Data infrastructure takes time.
They bet on CDOs leading up to the Global Financial Crisis; long unrated, short rated. Unrated CDOs were paying 15 to 20 percent interest.
"You never see that and you never read about that, but that’s the way the market’s set up."
The market was too fragmented to price the unrated CDOs properly. No one was willing to invest in it. All the buzz was on rated CDOs.
When rated CDOs blew up, Magnetar made a fortune.
I expect the GPU cloud space to be going through a similar fragmented period. The ones with backing from Wall Street financing partners would be "properly" priced. But those operating away from the limelight likely present a lucrative opportunity.
https://ritholtz.com/2024/03/transcript-david-snyderman/