The Derivative

Our guest this episode has quickly become one of the must follows on FinTwit with his mixture of motivational messaging and market savvy. Kris Sidial is the Co-CIO of The Ambrus Group, a volatility arbitrage fund that focuses on statistical outliers in the U.S equity derivatives space. But he’s no kid, despite his bio touting his 28yr oldness, having worked on exotic options desk, prop firms, and now his own hedge fund. Kris and Jeff dive into growing up on the other side of the tracks, market microstructure, whether you can outwork others in the quant space, the belly of the vol trade, gamma hedging, GME, NYC, LIU, Penn, flow, father’s day without a dad, liquidity cascades, options books (the positions), and options books (the actual reading type books). Don’t miss this great chat with one of the good guys in this space. Chapters: 00:00-02:49=Intro 02:50-16:24=Rough Route to Wall Street 16:25-23:03=Break-through 23:04-33:12=The Exotics Desk 33:13-45:38=Starting Ambrus 45:39-52:40=Covering the Bleed & Capped vs Uncapped 52:41-01:03:04=Finding Value in Volatility/Buying the Wings 01:03:05-01:11:39=A Shift in Dealer Hedging & Loving the Game 01:11:40-01:17:54=Favorites Follow Kris (@Ksidiii) on Twitter and get more information on the funds at Ambrus Group here.    And last but not least, don't forget to subscribe to The Derivative, and follow us on Twitter, or LinkedIn, and Facebook, and sign-up for our blog digest. And visit our sponsor, the CME Group at www.cmegroup.com to learn more about futures and options. Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit www.rcmalternatives.com/disclaimer

There’s a new word in the financial lexicon. Transitory. And it all has to do with whether recent moves higher in prices of everything from lumber to copper to labor are the first signs of 1970s type inflation, or….as the Fed believes, is just “transitory” and will work itself out once the pandemic is over. We’re sitting down with Executive Director and Senior Economist of CME Group, Erik Norland, to discuss just what he sees in the commodity space, including a first for our pod – charts during the video portion! Erik dishes on his background, how he ended up in London, Bayesian models, if you can be an economist without slides, Trillions, the devastation in India, the massive amount of debt in China, inflationary vs deflationary pressures, the craziness that is the hedonic CPI adjustments, infrastructure plans, R&D spending <> materials spending, if Gold is in trouble, why Europe’s lagging, whether there’s enough money to buy meme stocks/crypto AND physical goods to cause inflation, what options prices are saying about agriculture markets, and much more. Join our interesting conversation. Chapters: 00:00-02:40=Intro 02:41-12:00=The CME’s Euro Step 12:01-27:09=Fiscal Stimulus & Inflation during the Pandemic 27:10-48:27=Measuring Inflation & What about Deflation 48:28-55:28=The MMT Theory & China’s Debt 55:29-58:53=How Injured is India? 58:54-01:05:02=Agriculture, Energy & The Importance of Water 01:05:03-01:13:21=Fat Tails in Agriculture 01:13:22-01:16:54=Favorites Read more of Erik’s research on CME Group’s website here: https://www.cmegroup.com/education/featured-reports/bios/erik-norland.html And last but not least, don't forget to subscribe to The Derivative and sign-up for our blog digest. You can follow our host Jeff Malec on Twitter and RCM Alts on Twitter, LinkedIn, Facebook. Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit www.rcmalternatives.com/disclaimer

Artificial Intelligence is a hot topic in every walk of life, and perhaps no more so than in the world of hedge funds and alternative investments. Howard Siow, Founding Principal and CEO at Taaffeite Capital, joins The Derivative to discuss how AI is used in the hedge fund world, and how everyone wants AI to predict every move in the market, but that’s not actually what AI does well. Howard talks how AI can be used as an incremental change agent, chicken farming, being a venture capitalist, the effect of human biases, the dirty little secret holding AI back, trying to solve complex problems, being an engineer, launching Taaffeite, opportunities in China, and growing up down under in Australia. Chapters: 00:00-02:47=Intro 02:48-10:51=AI = Getting the small things right 10:52-22:25=The most complex system we have? 22:26-26:49=Launching Taaffeite 26:50-47:15=The Strategy 47:16-01:10:04=Is AI getting closer to solving the market problem? 01:10:05-01:16:08=Humble Adjustments 01:16:09-01:22:47=Favorites Learn more about Taaffeite Capital and their strategies here: http://taaffeitecm.com/ And last but not least, don't forget to subscribe to The Derivative. Follow our host Jeff Malec on Twitter and RCM on Twitter, LinkedIn, Facebook, and sign-up for our blog digest. Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit www.rcmalternatives.com/disclaimer

Who in their right mind would name an investment strategy after cockroaches?  Well, probably the guys who view themselves as staging a mutiny against traditional portfolio construction and the investment business = Jason Buck and Taylor Pearson of Mutiny Funds.  We're digging in deep with the two wunderkids in this episode on what exactly the Cockroach strategy is, what the first year for Mutiny looked like, Jimmy Buffet lyrics, AustinTexasville, applying e-commerce process and principles to asset management, living through the largest vol crush in history (as a long vol fund), the four quadrant model, gold and crypto as fiat protection, the modern hedge fund manager as a social media personality, Pretty Woman, growth stocks, inflation, deflation, diaspora, going full Kelly, and more...  Chapters: 00:00-02:29=Intro 02:30-17:04=Jimmy Buffet & Going from 0 to 1 17:05-27:00= Playing the Orchestra Not the Instruments 27:01-36:44=The merging of Social Media and Investing 36:45-52-12=The Cockroach Fund: Nuclear Winterizing Your Portfolio 52:13-01:05:19=Solving Multi-Generational Wealth  01:05:20-01:09:04=Who in their right mind would name an investment strategy after a Cockroach 01:09:04-01:15:12=Favorites Follow along with Jason and Taylor on Twitter and learn More about the New Cockroach Strategy here = https://mutinyfund.com/cockroach And last but not least, don't forget to subscribe to The Derivative, and follow us on Twitter, or LinkedIn, and Facebook, and sign-up for our blog digest. Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit www.rcmalternatives.com/disclaimer

How do you get included in a Market Wizards book? How do you get a whole Michael Covel book written about you? You move from charting markets on graph paper to point and figure charts to running systematic models on an IBM computer in 1980, to running $600mm plus via Trendstat. We’re talking Havalinas and Bassanovas with none other than Tom Basso in today’s episode. Tom is a New Market Wizard as identified by Jack Schwaeger, and now semi-retired, trading his own money in between dancing and wine making. We’re covering trend following, Arizona, raising money, enjoying the ride, making money, risk management, the mistakes big investors make chasing returns and bailing on drawdowns, facebook, trading red bean futures, chemical engineering, slippage, golf, and more. Chapters: 00:00-02:18=Intro 02:19-11:09=Arizona Pastimes 11:10-20:36=Back into Trading 20:37-36:00=How the Legend Started 36:01-01:02:12=150 Meetings 01:02:13-01:08:56=Mike Covel 01:08:57-01:17:15=Favorites Follow along with Tom on twitter and on his website, https://enjoytherideworld.odoo.com/ From the episode: Aaron Fifield Interview Trend Following Mindset: The Genius of Legendary Trader Tom Basso And last but not least, don't forget to subscribe to The Derivative, and follow us on Twitter, or LinkedIn, and Facebook, and sign-up for our blog digest. Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit www.rcmalternatives.com/disclaimer

We’re talking with two ‘in the crypto weeds’ traders/asset managers, Ben Upward of Synchronicity and Gary Basin, about crypto’s -30% one day drop, coinbase, the most surprising (& scariest) things about the recent crypto crash, size and action in futures, options, and non-futures, “what if” bitcoin had blown up, the right to a free market, bitcoin as beta?, new Bitcoin offers (like bitcoin micros), the negatives and positives of volatility in the space, leverage upon leverage upon leverage, bitcoin as a portfolio diversifier, a VC model, Portnoy picking, risk metrics, and the future costs of production for cryptocurrencies. Chapters: 00:00-02:28=Intro 02:29-15:12=Bitcoin falls -30%, what broke? 15:13-26:30=Bitcoin Futures & Unstable Bets 26:31-39-50=Farming, Staking, Embracing Volatility 39:51-53:30=The crypto hype machine, and new tech devaluing old coins? Follow along with Ben Upward on LinkedIn and Gary Basin on Twitter at @garybasin. And last but not least, don't forget to subscribe to The Derivative, and follow us on Twitter, or LinkedIn, and Facebook, and sign-up for our blog digest. Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit www.rcmalternatives.com/disclaimer

From actual capital allocator to branding his book and podcast “Capital Allocator,” Ted Seides has one of the biggest banks of knowledge in the capital allocation game. He’s a well-known author of two books, host of the podcast Capital Allocators, and in his “free time” invests his own money in some of the best and brightest hedge funds around. In today’s episode, we’re talking with Ted about Capital Allocators (the podcast & the book), the transition of talking to managers for an allocation -> to talking to allocators about managers on the pod, the Yale endowment and incredible opportunity to learn from Dave Swenson, bias in capital allocation, rebalancing without emotion, illiquidity premiums, base rates, allocator’s reaction to competition, blackbox of quants, portfolio construction, “Netflix” allocator selection, and Ted’s favorite guests & favorite quotes. Chapters: 00:00-01:42=Intro 01:43-28:16=Learning from David Swensen 28:17-48:55=Is Private Equity Too Big? 48:56-57:47=Base Rates, AI advancements & Fees 57:48-01:09:20=The Show or Allocators Podcast 01:09:21-01:22:23=Part of the Equation 01:22:23-01:28:39=Favorites (The Buffet Bet) Follow Ted on Twitter at @tseides, listen to Ted’s podcast on your preferred platform here, and purchase his books here. And last but not least, don't forget to subscribe to The Derivative, and follow us on Twitter, or LinkedIn, and Facebook, and sign-up for our blog digest. Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit www.rcmalternatives.com/disclaimer

Nigol Koulajian is the Founder and CIO of Quest Partners, a systematic trading firm with $1.8 billion in assets under management. In this engaging conversation, he discusses his transition from engineering to futures trading and the critical role of mindfulness in high-pressure investments. Nigol shares insights on managing tail risk, leveraging positively skewed trades, and the complexities of the financial industrial landscape. He also emphasizes the importance of meditation for better decision-making and clarity, all while showcasing his journey through the unique challenges of Wall Street.

Today’s guest is one you’ve heard many times before if you’ve listened to The Derivative,  but may not necessarily know all that well. He’s and alts/managed futures veteran, having started his career in Chicago’s famed trading pits, founded a futures investment firm, and continued on to become a partner at RCM Alternatives. ,And, of course, when not doing his day job, steps in as the dynamic host of our podcast. We’re talking Jeff Malec. We thought today’s podcast would be a great opportunity to get him from behind the host side of the mic to the guest side to get a little more familiar with his background, have a chance for him to share some of his own knowledge, and for all our listeners to see a different side. It is his birthday afterall – so what better episode? Jeff is interviewed by the team at Mutiny Fund in today’s episode where they’re talking about the differences between the New York traditional equity-based markets and Chicago’s futures markets and the pros and cons for investors, why Chicago’s approach did much better in 2008 and what investors can learn from that to apply to their own portfolios as well as the cash efficiency of futures, how investors should think about correlations, the common traits of the most successful investors, and why low volatility often means hidden risk and how to spot it in your portfolio. *Please note - this was previously recorded and reposted for this episode* Chapters: 00:00-01:50=Intro 01:51-16:16=Harley Davidson & Philosophy 16:17-39:07=Chicago Futures vs New York Stocks 39:08-47:54=RCM Alternatives 47:55-01:03:17=Portfolio Construction 01:03:18-01:13:39=Gold What is it Good For Follow Jeff on Twitter at @AttainCap2. And last but not least, don't forget to subscribe to The Derivative, and follow us on Twitter, or LinkedIn, and Facebook, and sign-up for our blog digest. Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit www.rcmalternatives.com/disclaimer

COVID affected a lot of ways that we interacted with the world – it changed how we worked, how we socialized, how we entertained ourselves….and if you’ve been tuned into the markets over the past year, it also changed our expectations on how in the world Oil prices could have ever gone NEGATIVE. Last year this time we put out our “Crude Oil Goes Negative…WTF ^%$#?! Pod” and were talking with veteran trader Brent Belote about the sticky situation. In today’s episode, we brought Brent back on to take a walk down memory lane about how last year really happened, what’s changed over the year since, how oil traders are taking different approaches since then, and how is the industry ensuring that we don’t head back into the treacherous red zone. In addition to all of that, we’re also digging in further with Brent about his shift from NY to WY, demand bounce back (or lack there of) for oil, flashback to negative prices 1 year ago, the physicality of oil commodities, background on the oil markets, fly fishing, starting out at the JP Morgan desk, effects of COVID on the oil industry, alternative energy and electric cars, oil storage & capacities, and Cayler Capital’s continuing success. Chapters:  00:00-01:52=Intro  01:53-08:38=No Space & Plenty of Space  08:39-25:55=The Physical Oil Trader  25:56-40:15=Oil Goes Negative: One Year Later  40:16-01:00:30=The Cayler Models  01:00:31-01:11:05=Oil Inflation, Alternative forms of Energy & Drill/Collect  01:11:06-01:16:27=Favorites Follow Brent Belote on LinkedIn and Twitter and check out Cayler Capital’s website. And last but not least, don't forget to subscribe to The Derivative, and follow us on Twitter, or LinkedIn, and Facebook, and sign-up for our blog digest. Disclaimer: This podcast is provided for informational purposes only and should not be relied upon as legal, business, or tax advice. All opinions expressed by podcast participants are solely their own opinions and do not necessarily reflect the opinions of RCM Alternatives, their affiliates, or companies featured. Due to industry regulations, participants on this podcast are instructed not to make specific trade recommendations, nor reference past or potential profits. And listeners are reminded that managed futures, commodity trading, and other alternative investments are complex and carry a risk of substantial losses. As such, they are not suitable for all investors. For more information, visit www.rcmalternatives.com/disclaimer