TTU125: Trend Following vs Short Term ft. Michael Pomada, President & CEO at Crabel Capital Management
Top Traders Unplugged
Niels Kaastrup-Larsen
4.8 • 670 Ratings
🗓️ 23 January 2023
⏱️ 82 minutes
🧾️ Download transcript
Summary
Today, we are joined by President and CEO of Crabel Capital Management, Michael Pomada, for a talk on their approach to trend following as well as short-term strategies. We discuss the trading philosophy behind Crabel Capital Management and why they choose to primarily be long vol, what role the Sharpe Ratio plays in their trading strategy and how they use data in their research process to understand markets, how being de-siloed helped them to make 2022 their best year in terms of research and how they create the most optimal work environment and culture for their team. How they utilize machine learning in their work and why they spend tens of millions of dollars on execution infra-structure, why they believe replication is like drugs and medication and why ESGs are important for them as a firm, how they manage drawdown control and mitigate risk. Lastly, we discuss why Pomada has found peace with fees going down and why being innovative is key in maintaining a solid income, why they are not concern about competition in the industry and much more.
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Episode Timestamps:
02:20 - Introduction to Crabel Capital Management
03:41 - The philosophy behind their work
08:46 - Their trading objectives
11:21 - Too concerned about the sharpe?
14:28 - Better alternatives to sharpe?
16:43 - Unearthing the anomalies
22:49 - Creating...
Transcript
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| 0:00.0 | You know, everyone likes easy, right? |
| 0:08.0 | Think about America today, by the way. |
| 0:10.0 | There's a drug for every problem. |
| 0:12.0 | You have high blood pressure, I got a drug for you. |
| 0:14.0 | You have high cholesterol, I got a drug for you. |
| 0:17.0 | You know, you're obese? I have a drug for you. |
| 0:19.0 | You know, that's that thing where it's like maybe instead of giving you a drug, you should exercise and eat better. |
| 0:24.6 | I mean, imagine that, right? |
| 0:27.6 | And so when I think about this, well, I'm not saying it's dumb, but it seems like a drug answer, like a drug answer to a problem. Whereas I think for those of us who work in the space, short term, medium term, |
| 0:38.2 | long term, we're really trying to make the portfolios better. Imagine spending an hour with the |
| 0:44.8 | world's greatest traders. Imagine learning from their experiences, their successes, and their failures. |
| 0:51.1 | Imagine no more. Welcome to Top Traders Unplugged, the place where you can learn from the |
| 0:57.1 | best hedge fund managers in the world so you can take your manager due diligence or investment |
| 1:01.9 | career to the next level. Before we begin today's conversation, remember to keep two things in |
| 1:07.1 | mind. All the discussion we'll have about investment performance is about the past, |
| 1:11.5 | and past performance does not guarantee or even infer anything about future performance. Also |
| 1:16.8 | understand that there's a significant risk of financial loss with all investment strategies, |
| 1:21.2 | and you need to request and understand the specific risks from the investment manager |
| 1:25.4 | about their product before you make investment decisions. |
| 1:28.6 | Here's your host, veteran hedge fund manager, Niels Kostrup Larson. |
| 1:37.4 | Hey everyone, and welcome to another edition of Top Traders on Plogged, where Alan Dunn and I today |
| 1:42.8 | are joined by Michael Pomata, |
... |
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