You like the idea of proving a strategy is broken rather than it is right. This was the question Michael Covel asked Ewan Kirk of Cantab Capital during one of his recent trend following mega episodes. The answer was fascinating: I don't think I'm the first person to come up with that. Effectively that is the scientific … Continue reading Let’s kill it!
Category: financial markets
"Imagine that every day you have to got to go to a Manhattan junction on a street corner with your folding chair, thermos of coffee and sandwiches. Morning rush hour comes by and you get jostled around. Same for the evening, you get jostled around and they knock over your thermos of coffee and step on your sandwiches. You got fumes of cars and weather changes. This is a terrible way to spend your life. Until one day the parade comes by. You don't know which direction the parade is coming from, but when it does come, you have the best seat in the house. This is trend following. The secret is to just stay on that street corner." (Chris Cruden - Insch Capital Management)
Today I came across an article of Gerry O'Reilly, portfolio manager of the Vanguard Total Stock Market Index Fund. The fund has $ 488 billion AuM. Key success factor (besides Vanguard's overall culture) is operational excellence / technology: Vanguard has invested heavily in technology. Algorithms help managers figure out where to buy and sell while minimizing market … Continue reading Execute!
That’s why they’re called surprises (Howard Marks – Expert Opinion)
Expert Opinion, the latest memo of Howard Marks is once more an interesting read. The reasoning throughout the memo resonates well with me since I believe it is worthwhile for a (discretionary) money manager to: (try to) understand the economy (try to) figure out the expectations embedded in the market bet small most of the time bet … Continue reading That’s why they’re called surprises (Howard Marks – Expert Opinion)
Understanding the world we live in (the Soros version)
From time to time, I grab a book from a few years ago and browse through it. This time 'The New Paradigm for Financial Markets' of George Soros (2008) was the lucky one. Although the Alchemy of Finance is the standard book here, this little book also contains some nice wordings. As a side note: AQR … Continue reading Understanding the world we live in (the Soros version)
It doesn’t make sense
This morning, I was listening to a recent podcast of Tim Ferris (Becoming the best version of you). I didn't really expect to get specific investment wisdom out of it. Around minute 27 however, Adam Robinson starts answering the question whether he blocks any particular things in his agenda. After mentioning lifting weights, cycling and … Continue reading It doesn’t make sense
There is no cash on the sidelines
In this first brief writing I would like to refer to the top 10 peeves from Cliff Asness (AQR library). All ten are good ones, but I especially like 5c: Every time someone says, “There is a lot of cash on the sidelines,” a tiny part of my soul dies. There are no sidelines. Those saying … Continue reading There is no cash on the sidelines