TTU05: What You Must Do To Survive In the CTA Business ft. Tushar Chande – 1of2

Jun 9, 2014

Tushar Chande, Co-Founder of Rho Asset Management, discusses the development of trading systems, using behaviors of discretionary traders, and designing the Alcheous Program. They explore the offense defense ratio, performance of the program, and inputs needed for algorithmic trading.

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INSIGHT

Randomness of Markets

Tushar Chande's engineering background led him to systematic trading due to his experience with mathematical modeling.
Trading attracted him because markets are random, unlike cause-and-effect systems he studied in engineering.

INSIGHT

Altius Program Design

Rho Asset Management's Altius Program incorporates diverse trading behaviors, similar to a trading desk with specialists.
However, it applies uniform rules across all markets for robustness, unlike specialized traders.

ADVICE

Evaluating Track Records

When evaluating managers with long track records, consider the market environment during performance periods.
Inquire about system changes and portfolio rates and how they affected returns over time.

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On today’s show I am talking to Tushar Chande, Co-Founder and Head of Research at Rho Asset Management. Tushar is also the author of a number of books on the topic of how to design rule based trading systems as well as having been actively trading these systems for more than 20 years.

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In This Episode, You’ll Learn:

Why the random nature of the markets attracted Tushar to develop systems for trading these markets
Background information on Rho Asset Management and it’s philosophy
How Tushar utilizes behaviors of discretionary traders to make estimates of conviction about their individual trades
How Rho has designed it’s Altius Program to offer meaningful protection when equity markets go down
What to be aware of when exploring an Asset Manager’s performance over a 20 year period
Offense/Defense Ratio, What it means and How to use it to Measure the quality of systems design
How Rho’s models have been designed in order to achieve the overall objective of the Program
What Trend Following Indicators are used for and why
Exploring the volatility of the equity curve
The input data needed to run the Altius Program, the time it takes and when they run the model

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Resources & Links Mentioned in this Episode:

Beyond Technical Analysis by Dr. Tushar Chande

Follow Niels on Twitter, LinkedIn, YouTube or via the TTU website.

IT’s TRUE ? – most CIO’s read 50+ books each year – get your FREE copy of the Ultimate Guide to the Best Investment Books ever written here.

And you can get a free copy of my latest book “Ten Reasons to Add Trend Following to Your Portfolio” here.

Learn more about the Trend Barometer here.

Send your questions to info@toptradersunplugged.com

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