In 2007, Dr. Ari Bergmann saw an iceberg approaching. Looking at the housing market, Dr. Bergmann’s firm (then called Sentinel Advisors) noticed the leverage of the banks increasing and the banks’ exposure to the housing market increasing—but no one seemed to be hedging the risk. After recognizing the house-of-cards situation, the team decided to open their own overlay, betting against the banks.

Dr. Bergmann is adamant that a strong hedging strategy is not designed to be an “insurance policy.” After all, the insurance companies are the only ones making the money, not the policy owners. The ideal strategy must also make money over the market cycle—a criteria that many hedge funds fail to meet.

Always a student of the market, Dr. Bergmann shares, “The market is greater than you, and that is something that always informs you. If the market tells you that you're wrong, get out. Reassess.”

Ari Bergmann is Founder and Managing Principal/CIO at Penso Advisors, LLC. He leads the firm’s investment committee and manages various Penso funds and clients’ mandates. Starting his professional career at Price Waterhouse as an accountant, Dr. Bergmann then worked in precious metals and commodity training at Drexel Lamber Trading Crop, followed by a twelve-year tenure at Bankers Trust. Prior to his current role, Dr. Bergmann served as CEO of Sentinel Advisors, LLC; this involved management of multiple funds with strategies including derivatives arbitrage, fund of funds, and risk overlay. Dr. Bergmann holds a master’s degree in Liberal Studies and a Ph.D. in Comparative Religion, both from Columbia University.

Disclaimer: This podcast is not investment advice, and should not be relied upon as a basis for investment decisions. All content in this podcast reflects the opinions and views of the speakers. This podcast is for informational purposes only, without representation as to accuracy or completeness. The guest interviewed on this podcast was not a client of SEI Novus at the time of recording.

The Jess Phillips Edition