UBS On-Air: Market Moves How should I be positioned? with Cliff Asness (AQR) and Jason Draho (UBS CIO)
13 snips
Sep 26, 2025 
In this enlightening discussion, Cliff Asness, co-founder of AQR Capital Management, known for his insights on market efficiency, and Jason Draho, UBS's Head of Asset Allocation, dive into the dynamics of today's financial landscape. They explore the impact of electronic trading and AI on investment strategies, the rise of bubbles fueled by social media, and the challenges of stock-picking in a rapidly changing market. Their insights on adapting portfolios to uncertainty emphasize diversification and trend-following as vital approaches.
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Faster Markets, Bigger Bubbles
- Cliff Asness observes markets have become faster at processing information but more prone to large valuation disparities and bubbles.
- He links two major recent disparities (dot-com and post-COVID) to structural changes in markets like passive investing and social media.
Passive Investing Reduces Price Discovery
- Cliff highlights rising passive indexing as a probable contributor to larger market mispricings and less price-focused participants.
- He cautions that 100% passive is impossible but growing passive share likely reduces active price discovery.
Social Media Amplifies Market Mob Behavior
- Cliff argues social media and online communities amplify mob psychology and meme-driven trading, increasing bubble risk.
- He sees markets as weighted voting mechanisms that social amplification can warp, similar to politics.
