Blog Posts

Business cycle analysis often involves an aggregation of past experiences and then tying together the cause-effect relationships that drove those cycles. Traders are especially interested in business cycle analysis given how it drives trends in asset classes, sectors, and investment outcomes. For example, early-cycle tends to be favorable to cyclical stocks while late-cycle favors being […]

When we talk about the question of are stocks overvalued, we need to frame the idea in terms of multiples of a metric that underlies their values. The value of a business is fundamentally the amount of cash that you can earn from it discounted back to the present. Earnings is revenue minus expenses. Free […]

This article was published on December 10, 2020. With short-term and long-term interest rates at zero in all of the main reserve currencies (USD, EUR, JPY), market participants will have to increasingly look for alternatives to bonds and cash. Cash and bonds are two of the main three asset classes in addition to stocks. But […]

In previous articles, we’ve covered the concepts of balanced beta and how to build a balanced portfolio in more depth. We’ve also covered the concept of the volatility risk premium, commonly abbreviated VRP. In this article, we’re going to combine the two concepts, building a balanced portfolio with what we call VRP overlay. A balanced […]

‘Risk-adjusted returns’ is a common term used in trading and investing, even to the point of being a buzzword. It’s what every institutional investor strives for in order to add value to their clients. And what every individual trader wants to get more bang for their buck. Risk-adjusted returns normally refers to the idea of […]

Each election cycle, new policymakers are elected and re-elected. Occasionally, every 4-8 years we have a new President of the United States, who is the head of one-third of the US government. US elections are important across several dimensions and have impacts on asset prices. The president has the power to shape foreign policy, appoint […]

Yield curve control has gone from more of an abstraction to a policy that many of the world’s most influential central banks are currently using or considering using. In the US, yield curve control, often known as YCC, hasn’t been employed since World War II. Back then, the very high economic demands of WWII required […]

Elections are always a time when traders and investors think about the implications of the results on their portfolios. However, in general, market participants tend to spend too much time thinking about the outcome and effect on their allocations. Elections create another set of probabilities to deal with and represent opportunity. But timing them and […]

In a previous article, we covered liquid alternative trading/investing, a type of long/short, typically market neutral(-ish) strategy that provides liquid, uncorrelated returns to traditional asset classes. These types of strategies, because of the market neutral character of them, are a good stepping stone into covering a bit on trader psychology. Even despite how much evidence […]

More tech startups are opting for direct listings instead of initial public offerings as the preferred way of going public. In this article, we’ll cover what direct listings are, how they work and why they’re popular among high growth companies, the pros and cons relative to the traditional IPO route, sustainability of this shift, and […]