Top Traders Unplugged SI363: The Misreading of Trend ft. Nick Baltas
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Aug 30, 2025 In this discussion, Nick Baltas, an expert in trend following and systematic investing, delves into the intricacies of CTA performance. He challenges the conventional wisdom around trend beta and highlights how changes in trend signal speed are redefining market dynamics. The duo explores the deeper structural divides in investing and questions whether chasing performance is less important than protecting against adverse paths. This engaging conversation emphasizes design over style and the subtle decisions that lead to enduring investment outcomes.
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July Felt Like A Turning Point
- Niels observed July as a turning point with constructive trends supporting CTAs, especially equities and select commodities.
- He noted fixed income and energies remained noisy and divided across managers.
August: Slower Signals, Gold, And Carry
- Nick reported August gains driven by slower strategies, equities and gold, while fixed income contributed marginally negative.
- He highlighted carry strategies' unusually strong performance year-to-date, separate from trend effects.
Correlation Shift ≠ Speed Change
- A shift in realized correlations does not prove a change in signal speed because many design choices can alter correlations.
- Introducing carry, stop-losses, or different markets can make a program appear faster or slower without changing its core trend window.