One of the most wonderful aspects of the hedge fund industry is that because it attracts the brightest minds, said minds are constantly coming up with new and outside-the-box ways of doing things. Eventually the innovation catches on and before you know it, something that might initially seem crazy eventually becomes best practice at firms worldwide. Take Alphonse “Buddy” Fletcher Jr, for example. The hedge fund manager is the subject of a Wall Street Journal profile today that highlights what the paper describes as Fletcher’s “unorthodox practices.” While it’s clear that some people are passing judgment on Buddy’s ways of doing things, his wiser colleagues in the field will immediately recognize the genius found within and start furiously implementing his methods today. Such as:

Dealing with redemption requests: As many of you may have learned first hand, investors get fairly bent out of shape when you tell them they can’t have their money back. But if you don’t have the cash on hand, what’s the alternative? One hedge fund manager recently said he would pay clients back not in actual money but in illiquid shares of a firm called LightSquared and in what seems to have come as a surprise to him, they didn’t like that either. How does Fletcher deal with such issues?

Last month, after two of the pension boards sought to withdraw some of their cash, Fletcher instead sent them promissory notes “in satisfaction of this redemption request” that pledged payment within two years.

For those taking careful notes the steps are as follows: Step One: redemption request. Step Two: redemption granted. Step Three: investor says “what?”. Step Four: manager says “What are you ‘what’ing? You’re getting your money, just later.”

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