ALO03: Lessons from a $25 billion CIO ft. Elizabeth Burton
Top Traders Unplugged
Niels Kaastrup-Larsen
4.8 • 712 Ratings
🗓️ 23 February 2022
⏱️ 64 minutes
🧾️ Download transcript
Summary
Alan Dunne is joined today by Elizabeth Burton to discuss managing a public fund versus a private fund, the challenges to those invested in the traditional 60 / 40 portfolio, the current outlook for inflation, performing above expectations, how to re-position a portfolio for higher expected inflation, fixed income versus real assets, categorising asset classes effectively, the limits of mean variance optimisation, using historical perspectives as an input into current decision-making, difficulties in the manager selection process, and how to simplify complex ideas in order to communicate more efficiently.
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50 YEARS OF TREND FOLLOWING BOOK AND BEHIND-THE-SCENES VIDEO FOR ACCREDITED INVESTORS - CLICK HERE
In this episode, we discuss:
- The outlook for inflation
- Achieving high performance consistently
- How to re-allocate a portfolio accordingly
- Mean variance optimisation
- Whether this time is different
- Selecting the right manager
- Simplifying complexity for better understanding
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Episode TimeStamps:
00:00 - Intro
03:30 - Elizabeth’s background and history in the investment world
04:55 - Elizabeth’s perspective on today’s markets
06:52 - Managing a public fund versus a private fund
08:14 - Performing above expectations
09:38 - The current outlook for inflation
11:31 - How to re-position a portfolio for higher expected inflation
13:57 - Fixed income versus real assets
14:51 - Categorising asset classes effectively
19:56 - The limits of mean variance optimisation
21:59 - Using historical perspectives as an input into current decision-making
24:09 - Whether this time really is different
25:25 - Difficulties in the manager selection process
28:35 - Choosing between macro and systematic investors
30:08 - The pitfalls of investing with macro traders
32:40 - Investing in a manager who includes crypto in their portfolio
34:34 - Allocating between systematic and discretionary managers
36:45 - How to screen for a good money manager
40:44 - How to respond when a manager is underperforming
43:48 - Process over outcome
47:04 - Working with consultants
52:27 - Lessons from a leadership coach
57:00 - Simplifying complex ideas for better communication
01:00:28 -Advice for aspiring allocators
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Transcript
Click on a timestamp to play from that location
| 0:00.0 | I went to Chicago and I think we always have a preference for things that are rooted in economic |
| 0:12.9 | history and economic fundamentals to a fault, even when they kind of don't make the sense |
| 0:18.0 | currently potentially. |
| 0:20.0 | That said, there are no two periods in history that are exactly alike. |
| 0:23.6 | And you can always add a qualifier to them. |
| 0:26.1 | And I can't think of any time in history that's exactly like this. |
| 0:31.8 | But what you can do, and I think can be meaningful, is you can look at how correlations or how assets tend to move in tandem during certain periods. |
| 0:42.3 | And I think that that may be an easier context. |
| 0:46.3 | The one kind of wrinkle lately is like the Fed is very different than it was decades ago, right? |
| 0:50.3 | So that's kind of putting a putting them on the whole thing. |
| 1:00.0 | Imagine spending an hour with the world's greatest traders. Imagine learning from their |
| 1:05.0 | experiences, their successes, their successes, and their failures. Imagine no more. Welcome to Top Traders Unplugged, |
| 1:12.6 | the place where you can learn from the best hedge fund managers in the world |
| 1:16.1 | so you can take your manager, due diligence, or investment career to the next level. |
| 1:21.0 | Before we begin today's conversation, |
| 1:23.0 | remember to keep two things in mind. |
| 1:25.0 | All the discussion we'll have about investment performance is about |
| 1:27.8 | the past, and past performance does not guarantee or even infer anything about future performance. |
| 1:33.7 | Also understand that there's a significant risk of financial loss with all investment strategies, |
| 1:38.4 | and you need to request and understand the specific risks from the investment manager about their |
| 1:43.0 | product before you make investment |
| 1:44.7 | decisions. Here's your host, veteran hedge fund manager, Nealz Kostrup Larson. |
... |
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