Narrative

From our A-Team of seasoned subject matter experts, the Narrative is an evolving stream of perspectives and insights on a broad range of financial subjects and asset classes. Please read, enjoy and share.

Author: Rusty Guinn
Date: July 27, 2017
Category: Things That Matter
Tags: diversification, volatility, portfolio construction, risk, investing, Kelly Criterion, the meaning of life

On this most important question of risk, we and our advisors often default to approaches which rely on the expectation that the past and present give us profound and utterly reliable insights into what we ought to expect going forward. As a result, we end up with portfolios and, more importantly, portfolio construction frameworks which don’t respect the way in which capital actually grows over time and can’t adapt to changing environments. That’s not good enough.

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Algorithmic Complexes, Alpha Male Brains, and Winnie the Pooh

Author: Neville Crawley GUEST CONTRIBUTOR
Date: July 19, 2017
Category: Rabbit Hole
Tags: big compute, AI, hedge funds, algorithms, machine learning, Taleb, evolution, fund of funds, ALIS, Winnie the Pooh, Douglas Hofstadter, Noah Harari, EFF, Mighty Mouse

AI and humanity continue to compete and cooperate, which makes sense considering that we’re all just complex complexes of algorithms searching for meaning.

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One Model to Learn Them All and AI Is/Isn’t Taking Over the World

Author: Neville Crawley GUEST CONTRIBUTOR
Date: July 14, 2017
Category: Rabbit Hole
Tags: artificial interlligence, learning model, global economy, autonomous learning investment strategies

As artificial intelligence technology evolves, there are two lines of thought: AI is either just about to take over the world or is embryonic and trivial in its achievements to date.

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Whom Fortune Favors | The Five Things that Matter #1

Author: Rusty Guinn
Date: July 6, 2017
Category: Things That Matter, Theory in Action
Tags: risk, evolution, social structures, manna, asset classes, Idiocracy, genealogy, asset allocation, behavioral finance, style boxes

If you’ve seen the film, you know why it has become so fashionable to talk about Idiocracy’s prescience. If you haven’t, a brief synopsis: the film tells the story of humanity many years in the future. In this future, humans are very stupid. The biggest celebrity is the resilient star of a hit reality show about a man subjected to repeated groin injuries. Farmers water their fields with an electrolyte-laden sports drink since, after all, as the Brawndo company clearly states, “it’s got what plants crave.” Plus, with that kind of television programming available, it’s not like you’re going to have time to read debates among historians about whether Scipio Africanus truly ordered the salting of Carthaginian fields.

Well, all that and they elected a wrestling and adult film star as president.

Don’t worry. I’m not going where you think I’m going with this, although I will admit that even though I threatened to write in President Dwayne Elizondo Mountain Dew Herbert Camacho in two prior elections, when he actually appeared on the ballot I found it a bit more difficult to pull the lever…

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Chili P is My Signature

Author: Rusty Guinn
Date: June 9, 2017
Category: Things That Matter
Tags: volatility, baseball, portfolio construction, Shakespeare, covfefe, value investing, robo-advisors, risk, correlation

When we build portfolios, we know full well how many options our clients or constituents have, so these three competing impulses drive our behaviors: cynicism, affectation and tribalism.

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