Krishna Memani on Wall Street's Very Expensive "Free Lunch"
We're told over and over again that the one "free lunch" in investing is diversification, and that you can improve your returns over time simply by investing in a wider range of assets. This is textbook modern finance. And yet over the past several years this hasn't been the case. An investor would have done great (with the occasional hiccups) just by investing in US stocks. What's more, even within US stocks, investors should have concentrated on big tech stocks. Going long US tech has been identified as the most crowded trade by investors for years, and yet most of the time it has outperformed almost everything else. So what are the lessons from this story? And is now the moment where international diversification is going to work? On this episode, we speak with veteran portfolio manager Krishna Memani, who is now the chief investment officer at Lafayette College. Previously, he was the CIO at OppenheimerFunds, which got bought by Invesco. We talk about portfolio theory, the tragedy of the prudent international investor over recent decades, and whether that realized return we've seen across a range of asset classes should prompt a fundamental rethink of finance theory. Odd Lots Live is returning to New York City on June 26. Get your tickets here!See omnystudio.com/listener for privacy information.
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Michael Cembalest on Why AI Is the Stock Market Bet of the Century
Michael Cembalest has been an investment analyst for almost 40 years and his research notes have drawn a cult following on Wall Street. He's known for going super deep into a wide range of topics, like energy and healthcare. And lately he's been writing a lot about AI, with a particular interest in figuring out whether all the investment in data centers and compute will translate into actual profits. On this episode, we talk to the chair of market and investment strategy for JPMorgan Asset Management about why AI is the market "bet of the century," why the dominance of US big tech can't be overstated, and why he's pessimistic about the outlook for small modular nuclear reactors.Odd Lots Live is returning to New York City on June 26. Get your tickets here!See omnystudio.com/listener for privacy information.
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58:52
Why Asset Allocators Love Multi-Strategy Hedge Funds
Multi-strategy hedge funds have been having a moment with big asset allocators pouring billions of dollars into names like Millennium and Citadel. And given all the growth, multi-strat funds have also been battling each other for talent. But why, exactly, do big investors seem to love multi-strats so much? What actually makes a multi-strat good to invest in? And how do fees and compensation work? In this episode, we speak with Ronan Cosgrave, a partner at Albourne Partners, which advises institutional investors on investing in hedge funds and other alternative asset classes. We talk about key differences between multi-strats and pod shops, plus the importance of pay to the business model.The Math Powering Profits at Multi-Strategy Hedge FundsMultistrategy Hedge Funds Delivered Again in 2024 Odd Lots Live is returning to New York City on June 26. Get your tickets here!See omnystudio.com/listener for privacy information.
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Zohran Mamdani, the Socialist Who Could Be NYC's New Mayor
We're just a month away from the hotly-contested Democratic primary for New York City Mayor. And one of the candidates -- Queens assemblyman Zohran Mamdani -- is running on a somewhat unusual platform. Endorsed by the Democratic Socialists of America, he's proposing rent freezes, universal childcare, higher taxes on corporations and the wealthy, free buses, and city-run grocery stores. In this conversation, we talk to the would-be mayor about his socialist vision for New York, including how he plans to fund more public goods, what he would do to ensure that government-run services are up to standard, and why there should be Halal carts on every street corner. Read more: NYC Mayor Ditches Democratic Primary to Seek Independent BidOdd Lots Live is returning to New York City on June 26. Get your tickets here!See omnystudio.com/listener for privacy information.
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Why Interest Rates Are Shooting Up All Around the World
This week the big story in markets is the selloff in bonds. Yields on benchmark 10-year US Treasuries jumped 20 basis points from last Friday’s low, while the 30-year rate is back above 5%. Meanwhile, 30-year Japanese government bonds clocked their highest yield since records began in 1999. And rates on UK gilts, German bunds, and Australian bonds are also rising. To make matters even more unusual, US Treasury yields are going up while the dollar is weakening (something that doesn’t usually happen.) So what’s going on? And how much does this have to with worries over the US fiscal position, the return of inflation, and the outlook for rate cuts from the Federal Reserve? On this episode, we speak with Steven Englander, global head of G-10 FX research at Standard Chartered. We talk about what’s driving the dramatic moves and the relationship between fiscal and monetary policy.Read more:Deglobalization’s Threat to the Bond MarketUS Bonds Swing as Dip Buyers Enter After Moody’s-Fueled SelloffOdd Lots Live is returning to New York City on June 26. Get your tickets here!See omnystudio.com/listener for privacy information.
Bloomberg's Joe Weisenthal and Tracy Alloway explore the most interesting topics in finance, markets and economics. Join the conversation every Monday and Thursday.
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