Excess Returns

Robert Hagstrom, an investment manager and author renowned for his insights on Warren Buffett, discusses key misconceptions in value investing. He highlights the pitfalls of focusing too rigidly on low P/E ratios and traditional metrics, revealing how this leads to missed opportunities. Hagstrom shares lessons from his accidental journey into finance and the importance of adapting investment strategies. He also reflects on Buffett's leadership transition at Berkshire Hathaway and critiques the illusion of private equity's appeal in today’s market.

Megan Horneman, Chief Investment Officer at Verdence Capital Advisors, dives into her 'Year of Fragile Optimism' thesis, highlighting the risks of hidden inflation and consumer debt. She discusses why the strength in consumer spending might be misleading and critiques traditional recession indicators that are breaking down. Megan emphasizes the potential of small/mid-caps and international stocks, the importance of active management, and offers insights into the risks and opportunities in the current fixed income landscape. Her macro perspective is invaluable for navigating today’s markets.

Warren Chiang leads portfolio management for GMO's systematic equity team, specializing in value investing. He dives into the evolution of value strategies, highlighting how traditional methods adapt in a world driven by intangibles. Chiang explains why deep value is historically low and discusses the blending of ESG, macroeconomic factors, and geopolitical shifts in portfolio construction. He also explores the implications of passive investing and the emerging trends in global manufacturing as firms shift away from China, presenting a fresh perspective on today’s market dynamics.

In this episode of Excess Returns, Matt Zeigler sits down with Peter Atwater—President of Financial Insyghts, author of The Confidence Map, and expert on decision-making under uncertainty. Peter lays out a bold and timely framework: in a world led by dominant nationalist figures, global corporations—and their investors—must now navigate a high-stakes game of being labeled either beneficiaries or victims. This conversation digs deep into how these dynamics shape capital flows, investor sentiment, policy risk, and the future of globalization.📌 Topics Covered:Why today’s political leaders are reshaping markets and capitalismHow investors must rethink confidence, control, and certaintyThe "beneficiary vs. victim" framework for companies and countriesImplications for capital allocation in a deglobalizing worldFragility of dominant leadership and geopolitical riskHow social media and sentiment shape investor perceptionWhere investors are most misaligned with current realitiesConfidence mapping for AI, private credit, Chinese equities, and more

David Giroux, CIO at T. Rowe Price, has outperformed his peers for 17 years. He discusses his unique approach to finding GARP (growth at a reasonable price) stocks and why many investors overlook high-quality options. Giroux emphasizes the importance of long-term thinking and his methods for navigating market cycles. He explores the impact of AI on portfolios and challenges conventional views on financials, utilities, and macro forecasts. Listeners also gain insights into the qualities of exceptional CEOs and the benefits of maintaining investment strategies during market dips.

Rupert Mitchell, founder of Blind Squirrel Macro, shares his wealth of experience on global market dynamics and investment strategy. He discusses how European pension funds are reconsidering their U.S. equity exposure and examines the implications of the powerful dollar. Mitchell offers insights into the Bushy portfolio, its innovative approach, and why the traditional 60/40 model is faltering. With a humorous take, he also explores the fierce rally of retail investors and the enduring dominance of the Magnificent Seven in the market.

Joe Gubler, Director of Quantitative Research at Causeway Capital, blends quantitative analysis with fundamental insights in innovative investing. He discusses the importance of adapting quant models to market conditions and reveals how unconventional signals like corporate events can enhance alpha generation. Joe dives into the transformative role of machine learning and AI in refining investment strategies. His insights highlight the necessity of a nuanced approach to risk management and the evolving landscape of sustainable investing.

Katie Stockton, founder and managing partner of Fairlead Strategies, shares her expertise on technical analysis and market trends. She discusses the current duality of a secular bull market and cyclical bear, revealing insights on U.S. and international equities. Key topics include sector rotations, market breadth implications, and the strategic positioning of her TACK ETF. Stockton also dives into the outlook for commodities like gold and crude oil, and offers her take on Bitcoin's potential breakout amidst evolving macroeconomic signals.

Rob Arnott, the founder of Research Affiliates and a leading voice in challenging economic norms, joins to discuss the pitfalls of government stimulus on growth. He argues that higher spending historically correlates with slower economic progress, emphasizing the importance of sustainable fiscal policies. Arnott explores lessons from Ireland and trade strategies, particularly tariffs, while providing insights into market expectations and uncovering undervalued investment opportunities in today's economy.

Kris Abdelmessih, a former options trader and founder of Moontower AI, takes listeners on an engaging journey through the world of options trading. Using Lego analogies, he simplifies the complex concept of put-call parity, revealing how options can replicate stock payoffs. Kris discusses synthetic positions and the true mechanics behind covered calls, all while shedding light on how traders infer interest rates through options pricing. With practical lessons and entertaining references, this conversation is a valuable resource for both beginners and seasoned investors.