TTU121: Trend Following... from Optional to Essential ft. Nick Baltas
Top Traders Unplugged
Niels Kaastrup-Larsen
4.8 • 712 Ratings
🗓️ 9 November 2022
⏱️ 73 minutes
🧾️ Download transcript
Summary
Today, Niels and Rob are joined by Nick Baltas, Managing Director at Goldman Sachs, for a conversation on systematic investment strategies. We discuss the difference between a number of systematic trading strategies and the pros and cons of each, how crowding impacts systematic investing and how the narrative created by media affects the systematic investment space, the capacity constraints for CTAs and the impact of costs. We also discuss how big an impact the trend following community has on the markets and the strength and weaknesses of different alternative markets, selective hedging and how skew can be used as a predictor of future returns. Lastly, we discuss the challenging environment of 2022 and why Trend is performing so well this year, why Trend Following is becoming an essential part of every portfolio and much more.
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50 YEARS OF TREND FOLLOWING BOOK AND BEHIND-THE-SCENES VIDEO FOR ACCREDITED INVESTORS - CLICK HERE
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Episode Timestamps:
00:00 - Intro
03:16 - Introduction to Nick Baltas
05:59 - Baltas’ findings from comparing different systematic trading strategies
12:10 - Is the CTA industry too small to have an impact?
16:44 - Blame it on the trend following people
21:42 - Baltas’ research on capacity
30:03 - The impact of trend
37:54 - Pros and cons between different alternative markets
46:10 - Using skew in your strategy
52:57 - Nick's article in Financial Times
01:05:47 - Is Trend Following becoming Essential for all investors?
01:11:55 - Thanks for listening
Resources discussed in this Episode:
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PLUS: Whenever you're ready... here are 3 ways I can help you in your investment Journey:
1. eBooks that cover key topics that you need to know about
In my eBooks, I put together some key discoveries and things I have learnt during the more than 3 decades I have worked in the Trend Following industry, which I hope you will find useful. Click Here
2. Daily Trend Barometer and Market Score
One of the things I’m really proud of, is the fact that I have managed to published the Trend Barometer and Market Score each day for more than a decade...as these tools are really good at describing the environment for trend following managers as well as giving insights into the general positioning of a trend following strategy! Click Here
3. Other Resources that can help you
And if you are hungry for more useful resources from the trend following world...check out some precious resources that I have found over the years to be really valuable. Click Here
Transcript
Click on a timestamp to play from that location
| 0:00.0 | Beginning of the year, it was like a cataclysmic confirmation of those trends. |
| 0:14.0 | Call it fear of missing out, call it confirmation of trends, call it an uncertainty resolution, |
| 0:20.0 | call it whatever you want to call it, |
| 0:26.0 | we had what we have been observing until this day, right? And I think that's the pivotal shift. |
| 0:34.0 | That is what made, in my view, the substantial regime shift in the market. And trend. |
| 0:39.6 | Imagine spending an hour with the world's greatest traders. |
| 0:44.1 | Imagine learning from their experiences, their successes, their successes, and their failures. |
| 0:50.6 | Imagine no more. Welcome to Top Traders Unplugged, the place where you can learn from the best hedge fund managers in the world so you can take your manager, due diligence, |
| 0:54.8 | or investment career to the next level. |
| 0:57.7 | Before we begin today's conversation, remember to keep two things in mind. |
| 1:01.5 | All the discussion we'll have about investment performance is about the past, and past |
| 1:05.5 | performance does not guarantee or even infer anything about future performance. |
| 1:10.3 | Also understand that there's a significant |
| 1:11.7 | risk of financial loss with all investment strategies, and you need to request and understand |
| 1:16.7 | the specific risks from the investment manager about their product before you make investment |
| 1:21.1 | decisions. Here's your host, veteran hedge fund manager, Nealiels Kostrup Larson. |
| 1:34.9 | Hey everyone, and welcome back to another edition of Top Traders Unplugged. Where today, Robert Carver and I are joined by Nick Baltas, who is a managing director at Goldman Sachs, |
| 1:40.2 | and who has done a lot of research and practical work in the systematic investment space. |
| 1:45.0 | So first off, Nick, thanks so much for joining us today. |
| 1:48.5 | We've very much been looking forward to this conversation. |
| 1:50.8 | How are you doing? How are things where you are? |
| 1:52.2 | I understand there's a little bit of turbulence where you are today. |
... |
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