Resolve Riffs Investment Podcast

Jason Buck is a founding partner of Mutiny Fund, an asset management firm with a vision to make high-quality tail hedging solutions available to a wider community of investors. Their fund aggregates managers with different tail-hedge styles, including options strategies, VIX relative value, and short-term trend traders to manage tails of all shapes and sizes.

We cover:

• Why tail risk is best managed through the use of ensembles
• The so-called "Dragon Portfolio" as a risk-parity solution that adds an extra dimension of risk
• How to think about sizing tail-hedge strategies in portfolios
• How to make hay while the sun is shining while remaining positioned for a storm
• How to manage the behavioral challenges of strategic allocations to tail-risk strategies

Jason brought a lot more to this discussion than just a pitch for tail hedges. It's clear he's thought deeply about the investment problem in general and has a clear vision about how tail hedge strategies can fit into a broader portfolio structure.

You'll definitely want to check this one out.

Adam and Pierre focus their discussion on diversification as a combination of "diversity" and "balance". Diversity is about holding investments that are designed to thrive in very different market environments, and for different reasons. Balance has the objective of ensuring that investments are all able to express their unique personalities.

Risk parity is the ultimate expression of diversification. Sadly, many investors are misguided about the concept, and focus on the wrong things. We drill to the heart of the idea and illuminate why a risk parity portfolio should be the starting place for most investors.

This is “ReSolve’s Riffs” – live on Youtube every Friday afternoon to debate the most relevant investment topics of the day.

We were joined this week by our friends Wes Gray (Alpha Architect) and Tobias Carlisle (Acquirers Funds) to discuss value investing, its prolonged winter and how it has fared in the current environment. This broad conversation includes:

• How value has historically outperformed growth, despite appearing to lag most of the time
• The mental – and emotional – fortitude required to stick with it during tough periods
• Active share – disaggregating value from broad equity beta
• Difference between harvesting Value in Long-Only vs Long-Short strategies
• Raw yields vs Excess yields
• Separating Value from Quality

The group also compared different value metrics against portfolio turnover and capacity, their relative cheapness with respect to the market as well as versus themselves over time.

Please enjoy this episode and join us live next week!

In this wide-ranging discussion, Logica's Mike Green describes a mosaic of ways to "seek out a straddle", and reveals new data and analysis to help flesh-out his thesis on the growing importance of systematic passive flows to U.S. stocks.

Mike makes a persuasive and disturbing case for how a series of regulatory changes driven by economic and political objectives have corrupted the equilibrium and signaling mechanisms of modern markets, and offers a framework, with specific examples, on how to position for a market environment that few currently expect.

Adam challenges Mike on a number of conjectures but Mike rises to the occasion with novel analysis and counter-intuitive interpretations bolstered by a variety of charts, tables, and illustrations.

Trust us – this episode will challenge almost everyone's beliefs and is not to be missed.

This is “ReSolve’s Riffs” – live on Youtube every Friday afternoon to debate the most relevant investment topics of the day.

On our second episode, we invited our good friend Corey Hoffstein (Newfound Research) to analyze the roller-coaster experienced by equity investors in the past 3 months and discussed:

• the disconnect between the equity rally and the pain in the broader economy
• the companies and sectors that have led the charge
• how Trend signals in equities have evolved in the recent period
• how investors might position themselves going forward

We also address the big question in most investors’ minds: should they jump back into the stock market and avoid additional FOMO or take this second chance to embrace a more diversified and adaptive approach?

Watch – or listen – below and join us live next Friday!

Join us for our inaugural episode of the “ReSolve Riffs” series where the team will go live on Youtube every Friday at 3pm over cocktails to discuss topics that are in the immediate zeitgeist of the investment world.

In this episode we cover the very heated tail protection debate. The team discusses the challenges with different types of tail protection implementations including:

• the difficulty in sourcing the right strategy
• the challenges of different fund structures,
• whether diversification alone is enough to manage tail risk and,
• the benefits of tail ensembles.

We also cover the behavioural challenges at all levels of investor sophistication that make it so difficult to stick with tail protection as a strategic long-term allocation, and make a case for the type of investor that might benefit from these approaches.

We hope you enjoy the episode and that you’ll join us to riff live with the team!

How long will the recession last? How deep will it be? What are the long-term implications for the economy, markets, and society? The global pandemic has ushered in a period of extreme uncertainty and investors are left with too many unanswered questions and afraid for their portfolios. Where do we go from here?

In this episode, the ReSolve team begins with an examination of some of the macroeconomic narratives that may drive capital markets for the coming months and years. But since these future paths are all plausible – and some quite compelling – we then provide a framework to deal with such a wide range of possible outcomes. This conversation is meant to help investors navigate these uncharted waters and how to think about portfolio allocations in extreme market conditions.

Be sure to check out the slide deck – which we reference throughout the episode – as well as some useful links below.

 

Links

https://investresolve.com/inc/uploads/pdf/The-Pandemic-Portfolio-Gestalt-University-Episode-13.pdf

https://investresolve.com/adaptive-asset-allocation-global-risk-parity-with-macro-factors-lp/

https://investresolve.com/blog/demystifying-risk-parity-with-realvision-and-90-years-of-history/

https://investresolve.com/webinars/ce-demystifying-risk-parity-90-years-history/

https://investresolve.com/podcasts/resolve-12-days-of-investment-wisdom/

 

 

 

The idea that mainstream media could, to some degree, pursue the agenda of powerful groups might have been dismissed as conspiracy theory in the past. But over the years much has changed in how we perceive and interpret the flood of news and data-bits that compete for our attention each day, forcing us to seek out ways to distill the noise in search of something closer to the truth.

Gestalt University’s latest guest has emerged as one of these trusted sources. His Epsilon Theory portal is one of the most respected and widely read information outlets in financial media. A prolific writer with a background in applied statistics and game theory, his acute understanding of history and behavioral analysis have equipped him the right tools to shed light onto the real forces that guide The Narrative Machine. He is, of course, Dr Ben Hunt.

A departure from our usual conversations, Adam, Rodrigo and Ben discuss how information is shaped, delivered, and ultimately drives the narrative that underpins capital markets and the global zeitgeist. They discuss how this has led the current political and financial climate to deviate from the dominant paradigm of recent decades, and how this affects portfolios and risk management. Please enjoy our latest episode with Ben Hunt.

This episode of Gestalt University could not be timelier, having been recorded two weeks prior to the current market correction that began in late February 2020. The discussion of fragile versus robust approaches is especially important given how recent volatility has led simpler tactical strategies to signal a complete shift away from equities and towards cash. This in turn has left practitioners second-guessing the wisdom of their indicators and hesitant to pull the trigger.

For this fascinating conversation we bring none other than Corey Hoffstein of Newfound Research. Corey has lived by the “risk cannot be destroyed, only transformed” dictum, which has guided the core of his investment philosophy across three axes of diversification – sources of risk, process and time.  Our similar thinking (including recent warnings of the dangers involving simple DIY tactical heuristics) led to an extensive research collaboration and ultimately to co-launch the Newfound / ReSolve Robust Equity Momentum Index (following requests from our FinTwit brethren).

Our discussion with Corey goes deep into the benefits of building strategies based on Ensemble Methods while considering the impacts of cost, the role of timing and luck, and ways to increase one’s confidence in a back-test. We also examine the behavioral benefits of strategy execution using an array of signals as opposed to binary approaches. A plateful for investors of all stripes, especially practitioners.

Chris Schindler’s journey really took him all the way down the rabbit hole. He joined the Asset Liability Group at Ontario Teacher’s Pension Plan in 2000 and soon became one of the founding members of the newly formed Tactical Asset Allocation Group.   Most of his 18 years at Teachers’ were spent exploring and developing quantitative tools and strategies to optimize portfolio allocations. An early insight regarding the importance of maximizing investment breadth (or unique independent return drivers) drove his research towards the world of CTAs and Risk Parity, eventually becoming one of the pioneers in Alternative Risk Premia (ARP).   There’s a good reason why this one runs a bit longer than previous episodes. We discuss the recent explosion in index-investing (“there’s no such thing as passive in this world”), Alternative Risk Premia (and why returns have suffered so much in recent years) and Chris’ new project: a truly uncorrelated alternative to ARP.   Please enjoy this incredibly insightful conversation between Chris, Adam and Rodrigo.