Paul

Image Credit: Brad Trent / The Times "Treat your life like a game." - Ray Dalio Before we get to the overview of our recent modeling of famed hedge fund leader, Bridgewater Associates and its founder, Ray Dalio, we need to set the stage for why this particular profiling is so important. It starts with what we have been calling personal alpha... Personal Alpha Ray Dalio is a singular phenomenon in the modern financial world. For starters, he's performed the feat of building the world's largest hedge fund (with $160 billion AUM as of latest count) and delivering "stellar gains" in its flagship Pure Alpha fund of 14.6% for 2018 while most others struggled. In Alphacution's asset management ecosystem map, Bridgewater defines the boundary between active and passive management zones due its role as the largest hedge fund. But more than stretching AUM boundaries and strong performance, Ray Dalio is a singular phenomenon because he has built an amazing business culture, and has recently set out to share his wisdom [...]

Last week, in timely fashion, the SEC published the 13F securities list for Q4 2018. Here is our breakdown of the quarterly change in product categories. Refer to the original US Stock Market Made of These! (or below) for the full history:   In August 2018, I did what I rarely do anymore: Cut an article out of a newspaper. The title and topic caught my eye, and eventually became the catalyst for some of the analysis presented here. Amongst all the digital gear, I still needed a physical marker to remind me... "The Stock Market Is Shrinking. That's a Problem For Everyone." (Jeff Sommer, New York Times, 8/4/2018) It turns out that if you search on a title like this, the story comes up several times over the past couple years. Forbes actually did a similar story after the NYT did the one above. Barron's did one before that, in mid-2017. In any case, the articles from 2018 are both based on a report by Rene Stulz of the [...]

Image Credit: Liu Bolin, Museo Enzo Ferrari ~ There is infinitely more than just the devil in the details. ~ Ludwig Mies van der Rohe It is so often said, offhandedly and seemingly without much regard for the underlying meaning, that the devil is in the details. Ever wonder about the origin of this saying? I suppose this might be a silly question for those of you who commonly say things without thinking, but it's still one worth pondering... Famed architect, Mies van der Rohe, is credited with the origin of the quote, but this is not his original version. The original quote, which I have further paraphrased in our opening for purposes that you will soon understand, was: "God is in the details."  Now, as someone who has always thrived on the value of details - and sometimes criticized for getting stuck in the weeds - this last version of the quote, which I reinterpret for my own purposes as "opportunity is in the details," has always come naturally. [...]

"Study the science of art. Study the art of science. Develop your senses — especially learn how to see. Realize that everything connects to everything else.” — Leonardo Da Vinci (~1500) "The real voyage of discovery consists, not in seeking new landscapes, but in having new eyes." - Marcel Proust (1923) In August 2018, I did what I rarely do anymore: Cut an article out of a newspaper. The title and topic caught my eye, and eventually became the catalyst for some of the analysis presented here. Amongst all the digital gear, I still needed a physical marker to remind me... "The Stock Market Is Shrinking. That's a Problem For Everyone." (Jeff Sommer, New York Times, 8/4/2018) It turns out that if you search on a title like this, the story comes up several times over the past couple years. Forbes actually did a similar story after the NYT did the one above. Barron's did one before that, in mid-2017. In any case, the articles from 2018 are both based on a report by Rene Stulz of [...]

Our recent foray into an analysis of the SEC's Form 13F reporting continues to bear fruit; arguably more fruit than can unreasonably be consumed at even the most festive holiday feasts. And yet, we must soldier on, if for no other reason but curiosity... Here's the quick setup for this one: Each quarter, the US Securities and Exchange Commission (SEC) publishes its list of equity and equity-linked securities for which certain asset managers (with aggregate holdings valued greater than $100 million) must report their gross notional long positions. (For more background, refer back to "Goldman Sachs' Book: Hiding in Plain Sight.") For all intents and purposes, this comprehensive list IS the quarterly rolling contents of the US "stock" market. In early 2010, this was a list containing nearly 15,000 unique CUSIP numbers. So, it occurred to us take a closer look at how these contents - from plain vanilla equities to convertible preferred's to options and, yes, to exchange traded funds (ETFs), among other product types - have migrated over [...]