Blog Posts

Limiting drawdowns and tail risks is one of the key goals – or at least considerations – of a portfolio. How do we reduce drawdowns without paying for insurance in the form of options (which tends to be expensive and drags down long-term returns)? That’s what we’ll cover in this article.   Key Takeaways – […]

Asset correlation is the degree to which different assets move together for the chief purposes of diversification value. Bitcoin, since its introduction in 2009, has evolved from a speculative asset among a niche audience to an emerging macro asset. For many individual traders, they’re more interested in the volatility and price movement. For institutions, they’re […]

The safe withdrawal rate (SWR) is the percentage of a retirement portfolio that can be withdrawn each year without significantly increasing the risk of running out of money over your lifetime.  It’s a guideline to balance spending needs with asset preservation. We look at the common wisdom, then run our own simulations at the end. […]

In this article, we take a structured and more numbers-driven survey of the bond market: its early history, scale/size, strategies or uses, and key statistical trends. Key sources for this article include FRED (Federal Reserve research), SIFMA, BIS, Pew Research Center, Trading Economics, icmagroup.org, and OECD.   Key Takeaways – Bond Market Statistics Bonds evolved […]

If you have a proprietary trading operation, multi-strategy hedge fund, family office, or other business designed to make money trading the financial markets, at some point you will probably want to hire traders to work for you (beyond the execution kind). It’s a way to scale and diversify your trading business. However, for anyone who’s […]

A carry trade involves profiting from yield or premium differentials between assets. The classic example is currency carry (borrowing low-yield, long high-yield), and essentially betting on the yield differential. This same logic applies to volatility markets through options, which intrinsically have implied volatility baked into them. Options carry trades involve the concept of harvesting the […]

The Sharpe ratio is a risk-adjusted return that looks at the return over cash relative to volatility. It’s crude (e.g., treats upside and downside volatility the same, volatility = the sole measure of risk), but it’s widely used as a return-to-risk ratio. It’s often looked at as a static figure when looking at asset classes […]

If you ask 100 people who the world’s most successful investor is, probably over half of them (who give an answer) would say Warren Buffett. The puzzle: is his success skill, luck, survivorship bias, or something explainable? To answer this, we looked at an academic paper by Andrea Frazzini, David Kabiller, and Lasse Heje Pedersen […]

In trading, productivity is essential. Traders need to make quick decisions, analyze vast amounts of data, and stay ahead of changing market trends.  You have only so much time and so much energy. Boosting productivity can lead to better decision-making, higher profits, and a more balanced lifestyle.   Key Takeaways – Productivity & Time Management […]

Trading and investing isn’t about predicting or knowing the future. It’s about preparing for many possible ones. Monte Carlo simulations let us stress-test portfolios by running thousands of “what if” scenarios with different volatility and leverage assumptions. Instead of a single forecast, you see ranges of outcomes: steady growth paths, sudden collapses, and everything in […]