I remember Taleb fund kept losing money and only profit if black swan happens. Sort of gambling I think.
He is basically long volatility with huge payout asymmetry. He loses tiny amount of money if everything is in "normal" range and makes huge profits if there is "black swan" type of event.
Yes indeed one major flaw and the biggest flaw of the fat tail risk management is the continuous high cost that you have to shell out non-stop while waiting for black swans which do not happen every day; it only happens once in a blue moon. And when that finally happens, you may or may not recover all of the cost that you have been shelling out all those times. I can understand those fund managers' frustration. I mean you almost have to hedge against the fat tail risk management itself in case the black swan never happens.