My Philosophy

My approach to trading rests on a few core principles:

• Markets are close to efficient. It's hard to make money in markets. Edges are rare, small, and must be applied with absolute discipline.
• All analysis—fundamental, macro, economic, technical, or model-based—only offers a probabilistic tilt, never certainty. We deal in probabilities, not certainties.
• Risk is the ever-present companion of opportunity. Effective risk management is the first job.
• Behavioral factors matter. Human reactions to risk, opportunity, and volatility have remained consistent for centuries.
• Though there are many paths to investment profits, our approach is a blend of quantitative analysis and discretion supported by a rigorous statistical framework extending back to commodity prices in Europe in the Middle Ages. We face modern markets fully aware of their capacity to innovate and evolve, but we also understand what elements of human behavior in markets have not changed for hundreds of years.
• We believe that intuition and discretion have a place in the investment process, but they must be tempered and informed by a rigid statistical framework.
• Most things that most people believe work in the market simply do not work. It is vitally important to have a disciplined process that has a verifiable edge.