SI137: Can AI Trading Be Better Than Classical Methods? ft. Mark Rzepczynski

Apr 25, 2021

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Today, Mark Rzepczynski returns to the show to discuss how Trend Following allows investors to own more risky assets, Systematic Global Macro versus Trend Following, the process of how an investor digests new information, classical Trend Following versus modern Trend Following with AI methods, whether rock-star hedge funds such as ARK Invest can end up being too greedy when seeking AUM, why it can be a good idea to avoid timing the different exposures of your portfolio as much as possible, some of the possible reasons behind Dunn Capital’s successful near 50-year track record, and thoughts on position-sizing in relation to historic volatility.

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50 YEARS OF TREND FOLLOWING BOOK AND BEHIND-THE-SCENES VIDEO FOR ACCREDITED INVESTORS - CLICK HERE

In this episode, we discuss:

How a Trend Following approach allows safer access to risky markets
The differences between Systematic Trading based on macro data versus based on price-only
How a top trader should efficiently process new data
Modern AI-based Trend Following versus classical Trend Following
Whether the biggest hedge funds in the world fall victim of being too greedy for AUM
Why you should avoid 'timing the market'
The possible secrets of success behind Dunn Capital's near 50-year track record

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Episode TimeStamps:

00:00 – Intro

02:00 – Macro recap from Niels

08:46 – Weekly review of performance

13:28 – Swedish systematic macro-fund, IPM, closes after losing $4billion during the pandemic

28:37 – New style Trend Following with machine learning versus classical Trend Following

53:54 – Some of the reasons behind Dunn Capital’s successful near 50-year track record

01:05:03 – Q1 Raymond: What are some good methods for market selection, other than liquidity?

01:08:35 – Q2; Dirk: Have you found significant differences between volatility-based position-sizing and a one-size-fits-all approach?

01:17:10 – Benchmark performance update

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