How Does Crowding Come Into Play?

Investors are chasing sharp ratio too much and relying on volatility too much. This is effectively distorting price distorting the returns of trading strategies it's creating what we call crowding. We're mainly trying to replicate the decision-making processes of large allocators and of large PM platforms so when you go into a drawdown they're gonna cut your allocation by 50 percent but if you lose a full volatility you're actually allocated the 100 percent. There's a huge cost to investing even in the smart beta strategy if it's public or heavy allocated to fixed income.

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