Is This Replication or Alternative Data Beta?

In this week’s Systematic Investor episode, Niels and Andrew Beer explore how a broken 60/40 paradigm is forcing wealth managers into a new world of “other” diversifiers. Andrew reflects on the Goldman Sachs report about private wealth flows, the rise of liquid alts and why big houses are suddenly launching trend ETFs. The conversation dives into replication versus traditional CTAs, the true cost of complexity, and Simplify’s new index-based product built on Andrew’s strategy. Along the way they debate pods, Bitcoin, and Andrew’s evolving metaphor of managed futures as a cloudy, but occasionally crystal-clear, macro crystal ball.

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Episode TimeStamps:

00:00 - Intro and Thanksgiving reflections, gratitude and mood after the holiday

01:14 - Goldman report: trillions from wealthy investors and a seismic shift away from 60/40

03:38 - Why bonds stopped diversifying and the growth of the “other” bucket in portfolios

05:44 - Liquid alts vs illiquid alts and the timing of big firms launching trend ETFs

08:25 - Odd Lots, pods and Dalio’s skepticism on multi-strats’ future

09:22 - Bitcoin’s volatile run and rumors of a manipulated pullback

10:59 - November performance: zigzags in trend indices and short-term traders’ struggles

12:55 - How DBMF positioned: concentration, short yen, euro pain and being contrarian post “Liberation Day”

16:05 - Are we still “replication”? Alternative data beta, tracking error and what’s really being delivered

18:16 - Targeting “space beta” plus cost savings: is complexity in CTAs adding or destroying value?

22:14 - Indexing the replication strategy and using swaps: Simplify’s new "low" headline fee ETF built on Andrew’s index

30:49 - The fee and cost debate: headline fees, trading costs, swaps and what investors should really ask

34:33 - Implementation costs, incentive fees and tax efficiency versus simple fee labels

45:08 - A better story for managed futures: from black box trend to “cloudy crystal ball”

51:22 - How trend taps local information: “someone knows something” and prices as detectors

58:03 - Takeaways from the Stockholm roundtable: short vs long term, exotic markets and heterogeneity

01:01:07 - Alpha-beta separation, core CTA beta vs high-conviction managers and where the space is heading

01:03:44 - Closing thoughts: civilized disagreement, common mission and why every portfolio needs this exposure

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