Excess Returns

Cullen Roche, founder of Discipline Funds, joins the podcast to discuss measuring inflation, the relationship between inflation and the labor market, and the future path of inflation. They also touch on the potential impact of a Trump victory on inflation and the market, as well as the role of artificial intelligence in revolutionizing the economy and reducing inflation.

Cem Karsan, founder of Kai Volatility, joins the podcast to discuss topics such as the future outlook for inflation, the Fed's actions, structured products, ODTE options, and the importance of thinking in probabilities. They also touch on option dealer flows and the potential February window of weakness.

Andrew Chen and Alejandro Lopez-Lira challenge the foundation of asset pricing theory in their recent paper, questioning the reasons behind the excess returns generated by investment factors. Their study compares anomalies with behavioral and risk-based explanations to data-mined anomalies, finding no difference in out-of-sample returns. This has significant implications for academic research and real-world investment strategies. The podcast delves into their findings, exploring the concepts of anomalies, factors, data mining, and the role of peer-reviewed theory in asset pricing.

On the latest episode, Fairlead Strategies founder Katie Stockton discusses her approach to managing her personal portfolio. They cover asset allocation, incorporating technical analysis, international diversification, the benefits of a financial advisor, leaving money to kids, and more.

Andrew Beer, Founder of DBi, discusses his approach to managing his personal portfolio, including his views on stocks and bonds, incorporating managed futures, homeownership, and charitable giving. He also reflects on the importance of long-term thinking, being actively involved in philanthropic efforts, and the power of compounding.

Chris Davis, Chairman and Portfolio Manager of Davis Advisors, discusses his process for analyzing companies and his owner earnings-based approach. He shares his biggest lessons from his successful investors family, how Charlie Munger changed his life, and his thoughts on concentration and position sizing. They explore concepts like owner earnings, business growth, and the role of directors in creating shareholder value. They also touch on the influence of David Swenson and Jeff Bezos' strategies, as well as the importance of thinking like an owner and owning a business, not just a stock.

Adam Butler, ReSolve Asset Management CIO, joins the podcast to discuss generative AI and its impact on investing. Topics include large language models' functioning, including their ability to process data and generate responses, the constraints and potential of GPT-4, using generative AI in investing for prototyping and data integration, the benefits of a tool for Python code translation and data exposure, building investment strategies using AI, and embracing generative AI technology.

Renowned investors including Guy Spier, Rob Arnott, Michael Mauboussin, Steve Romick, Joel Tillinghast, Cem Karsan, Bob Ellott, and Jerry Parker share their most important investing lessons. Topics covered include self-forgiveness, action, and diversification, the importance of knowledge and flexibility, avoiding natural investing mistakes, analyzing the truth and geopolitics, investing in real opportunities, thorough homework and independent research, the significance of rebalancing, finding your investing philosophy, understanding the importance of perspective, the importance of price confirmation and having an open mind, maximizing contributions to retirement accounts, and teaching children about investing.

Larry Swedroe, head of financial research at Buckingham Strategic Wealth and author of multiple investing books, delves into the intricacies of alternative investing. He discusses the unique risks of illiquid assets and how they enhance portfolio optimization. Listeners learn about the advantages of interval funds, reinsurance, and managed futures, as well as the importance of diversification beyond traditional stocks and bonds. Swedroe emphasizes a disciplined, evidence-based approach to investment strategies, helping investors navigate today's complex market landscape.

Wes Gray, founder of Alpha Architect and ETF Architect, shares his lessons from growing his businesses and discusses the rapid growth of ETFs. He talks about the struggles of value investing, identifying when a factor no longer works, and the pros and cons of sector neutral value investing.