How to Manage Futures in All Weather Portfolios

Jeff is “stacking” two guests in this episode, welcoming 1. Corey Hoffstein, CIO and co-founder of Newfound Research, host of Flirting with Models Podcast, and co-conspirator on the Pirates of Finance YouTube channel; and 2. Rodrigo Gordillo, President and Portfolio Manager of Resolve Asset Management and host of the Resolve Riffs Friday live stream. They’re talking about their new research paper: “Return Stacking: Strategies for Overcoming a Low Return Environment,” which takes a novel approach to solving a few problems. Such as: How do you endure the ‘line item risk’ of an alternatives allocation? How do you participate in the upside of an increasingly overvalued stock market? What value do bonds bring as a diversifier at the zero bound? The answer boils down to some new capital-efficient ETFs and mutual funds, which stack asset classes and returns on top of one another at greater than 100% exposure. How does that work exactly? What are the pros and cons? What types of products can investors look at? Listen in to find out more. 

Chapters: 

00:00-02:36=Intro 

02:37-10:30=It’s the Cayman Islands…not Caymans 

10:31-29:55=Return Stacking: The Paper, the Problem & the Solution 

29:56-38:33= Leverage and Capital Efficiency 

38:34-01:04:14= Managed Futures, Macro, and Convexity as Diversifiers 

01:04:15-01:12:09= Are you just Stacking Fees? 

01:12:10-01:26:16= I’m Scared to Buy at All-Time Highs (and to Own Bonds) 

01:26:17-01:30:24=Favorites 

From the episode: 

Download the whitepaper here: https://info.rcmalternatives.com/return-stacking 

Podcast: Noodling on Ensembles, Trend, & Convexity with Newfound’s Corey Hoffstein: https://podcasts.apple.com/us/podcast/noodling-on-ensembles-trend-convexity-newfounds-corey/id1497570451?i=1000478501833 

Podcast: Asset Allocation, AI, and the Alpha Process with Resolve Asset Management: https://podcasts.apple.com/us/podcast/asset-allocation-ai-alpha-process-resolve-asset-management/id1497570451?i=1000467460922 

Flirting with models podcast: https://blog.thinknewfound.com/podcast/ ReSolve's Riffs: https://investresolve.com/single/resolve-riffs/ The picture from space that shows why commodities are non-correlated: https://www.rcmalternatives.com/2013/10/the-picture-from-space-that-shows-why-commodities-are-non-correlated-to-the-stock-market/ Follow along with Corey & Rodrigo on Twitter @choffstein https://twitter.com/choffstein and @RodGordilloP https://twitter.com/RodGordilloP?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Eauthor Don't forget to subscribe to The Derivative (https://www.rcmalternatives.com/the-derivative-podcast/), and follow us on Twitter at @rcmAlts (https://twitter.com/rcmAlts), and our host Jeff at @AttainCap2 (https://twitter.com/AttainCap2), or LinkedIn (https://www.linkedin.com/company/rcm-asset-management/), and Facebook (https://www.facebook.com/RCMAlternatives/), and sign-up for our blog digest (https://info.rcmalternatives.com/get-our-blog-alternatives). And visit our sponsor, the CME Group at www.cmegroup.com to learn more about futures and options. Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit www.rcmalternatives.com/disclaimer