The Difference Between Outcome and Distribution

We had the pleasure this week of speaking with Cem Karsan (the pronunciation can be a bit challenging, bit the hint is in his Twitter handle - @jam_croissant), founder of Kai Volatility Advisors. His deep knowledge of market structures and investment flows took us on a fascinating conversation that included:

• Joining a team early in his career that would become one of the Street’s largest options market makers
• Developing a profound understanding of the reflexive game of dealer positioning and its feedback effects on asset prices
• Launching Kai Volatility Advisors and three uncorrelated strategies
• A quantitative approach with a discretionary overlay
• The circumstances under which dealer flow becomes most relevant
• The upcoming June expiration and the ‘massive delta’ hovering over the market
• Distributions vs expectations
• The remarkable advances in the options market over the last two decades
• The ‘dramatic oversupply’ of volatility and its underperformance as an asset-class
• The JP Morgan Equity Hedge giant and its impact on the market
• Efficiency, transparency and performance – the trade-offs between ETFs and private pools
• Cem’s global macro perspective and his take on the current environment
• The explosive combination of cheap capital and technological innovation
• The road to inflation – inequality, populism and a pandemic-induced fiscal trigger of titanic proportions
• And much more

This is “ReSolve’s Riffs” – live on YouTube every Friday afternoon to debate the most relevant investment topics of the day, hosted by Adam Butler, Mike Philbrick and Rodrigo Gordillo of ReSolve Global* and Richard Laterman of ReSolve Asset Management Inc.

*ReSolve Global Inc. refers to ReSolve Asset Management SEZC (Cayman) which is registered with the Commodity Futures Trading Commission as a commodity trading advisor and commodity pool operator. This registration is administered through the National Futures Association (“NFA”). Further, ReSolve Global Inc. is a registered person with the Cayman Islands Monetary Authority.