Our Investing Process
Investing and life are all about getting better with each passing day. Our process is always evolving.
Fundamental and Quantitative Risk Management Process
We use both a fundamental research approach and a quantitative macro framework and combine the two in our risk management process..
We believe we can gain an edge over consensus by combining quantitative and investment process.
Rate of Change
Its not whether something is good or bad, but getting better or worse, in rate of change terms. We look at all the incoming macro data to understand where we are in the economic cycle.
There are few concepts more fundamental to our research process than measuring and mapping economic data on a “rate of change” basis. Rigorously tracking year-over-year growth across economic indicators illuminates pivotal inflection points in macro markets.
Now, consider the following chart. That’s a sine curve. It represents the rate of change of a particular data set over a given period of time. You’ll hear us referencing this lot.
- “I knew which shifts in the economic environment caused asset classes to move around, and I knew that those relationships had remained essentially the same for hundreds of years. There were only two big forces to worry about: growth and inflation.”
-Bridgewater Founder Ray Dalio
- “It’s not whether something is good or bad. It’s about knowing whether it’s getting better or worse.”