Top Traders Unplugged

Cian Walsh, Head of Hedge Funds and Private Debt at Formue, shares his wealth management expertise rooted in a diverse career spanning multiple global markets. He challenges the conventional 60/40 asset allocation model, emphasizing the need for adaptability in today's dynamic environment. The discussion also delves into innovative portfolio strategies, the transition from vintage private credit to evergreen solutions, and the importance of viewing hedge funds as functional elements rather than mere categories. It's a deep dive into building resilient portfolios amid shifting macro conditions.

Markets have rebounded quickly, but underlying factors raise questions. The bond market’s resilience amidst deficits and volatility’s impact on asset prices are scrutinized. Key insights delve into the misconceptions surrounding drawdowns and the illusions of diversification. The interplay of liquidity, macro policies, and risk management is dissected, revealing the challenges investors face today. Geopolitical events and their effects on market dynamics emphasize the need for adaptive strategies in uncertain times.

Asim Ghaffar, Founder and CIO of AG Capital, shares insights on the critical role of insourcing for hedge funds. He highlights the significance of sales and branding in attracting investors while navigating the end of the bull market. Asim discusses AG Capital's trading strategies, emphasizing risk management and concentrated positions. The conversation also touches on investment themes like gold, Bitcoin, and natural gas, providing a balanced perspective on navigating current market conditions and investment opportunities.

Rob Carver and Niels dive into the current market's uncertain state, analyzing the impacts of recent changes in banking regulations and shipping volumes on global demand. They explore the math behind drawdowns and the complexities of position sizing, as well as the common misconceptions about diversification. The discussion highlights the value of avoiding mistakes in a highly competitive environment and examines how fresh perspectives from traders can invigorate strategies. It's a thought-provoking look at maintaining an edge in trading.

Bob Elliott, an investment strategist renowned for his expertise in macroeconomics, joins the discussion to unravel the complexities of today's financial landscape. He emphasizes that while strong economic data seems promising, it conceals deeper structural shifts in the economy. Topics include the potential for inflation to defy expectations, the impact of tariffs and labor shortages, and the prospect of capital flowing out of the U.S. for the first time in decades. Elliott urges a rethink of traditional investment strategies to adapt to this evolving reality.

Yoav Git, a financial expert currently visiting his parents in Israel, dives into the complexities of the global crisis and the oil market. He discusses how portfolios can benefit from negatively correlated assets, even if they yield little in returns. The conversation touches on the ongoing challenges in volatility and how trend-following strategies defy traditional investment wisdom. Git emphasizes the importance of risk management and diverse approaches over superficial performance metrics, urging listeners to reconsider their investment strategies.

Barry Eichengreen, a renowned Professor of Economic and Political Science at UC Berkeley, dives into the precarious state of the U.S. dollar. He discusses rising debt and domestic fractures that are altering market perceptions. The conversation highlights the challenges facing central bank independence and how credibility, over currency, may become a liability. Eichengreen also draws parallels to historical trade wars, exploring how these lessons apply to current global economic dynamics. The potential rise of digital currencies further complicates this evolving financial landscape.

Nick Baltas, a systematic investor, dives deep into the intersection of technology and trading challenges. He discusses the overwhelming influence of AI on data and signals, revealing how market reversals are complicating strategy design. The conversation highlights the struggle of adapting volatility targets while maintaining conviction amidst uncertainty. Baltas reflects on the performance of trend-following strategies during volatile markets and the constraints institutional investors face, urging a rethinking of traditional investment practices in an evolving landscape.

Benn Eifert, CIO and Managing Partner at QVR, offers deep insights into today’s volatility regime. He discusses how market structure influences outcomes more than macroeconomic factors. Eifert highlights the fragmented liquidity and the breakdown of correlations, stressing that the path of market movements is more significant than their magnitude. The conversation dives into the rise of zero-day options and their implications on trading strategies, while also examining the unique dynamics of retail trading and the evolving landscape of financial markets.

Rich and Niels delve into the choppy waters of trend following, tackling the rift between standalone market behavior and portfolio-level strategies. They discuss how tariff policies and institutional positioning are reshaping assumptions. There's a fascinating look at AI’s growing influence in trading and the hidden costs of poor data. The episode also explores the essential nature of robust backtesting and the pressing need for adequate capital to navigate today's challenging market landscape.