Macro Legend Alex Gurevich on Inflation and Navigating Markets in Crisis

Mar 8, 2022

We were joined this week by none other than Alex Gurevich, founder and CIO of HonTe Investments, author of The Next Perfect Trade, and more recently The Trades of March 2020 – A Shield Against Uncertainty, and a legend in the macro hedge fund industry. Our conversation included topics such as:

• His background in math, and as a competitive chess, GO and poker player
• An analytical approach that was well-suited for a Wall Street trader
• Skin in the game – he wanted to be a trader from the start, not an analyst
• Typical patterns in financial markets tend to repeat themselves much more frequently than most investors realize
• Employment and energy prices as strong leading indicators for a recession
• Interest rate momentum and a bearish outlook for equities
• How tighter monetary policy may be the wrong tool to fight inflation caused by higher energy prices and supply chain disruptions (and could backfire)
• Political pressures, the Fed, and the increasing likelihood of a policy error
• An investment approach focused on major global asset classes and big picture thinking
• Seeking opportunities with asymmetric odds
• Precious metals are less about inflation and more about liquidity
• A risky moment for the global reserve currency
• How to protect against low probability scenarios that can pose devastatingly negative outcomes
• Creative hedging
• Avoiding unnecessary complexity when expressing views – vanilla is usually better than exotic options
• Time horizons, and differentiating risk management for a trade vs portfolio holding
• Sizing, stress analysis and conviction – why stop losses are not always the best way to manage risk

 

This is “ReSolve’s Riffs” – live on YouTube every Friday afternoon to debate the most relevant investment topics of the day, hosted by Adam Butler, Mike Philbrick and Rodrigo Gordillo of ReSolve Global* and Richard Laterman of ReSolve Asset Management.

 

*ReSolve Global refers to ReSolve Asset Management SEZC (Cayman) which is registered with the Commodity Futures Trading Commission as a commodity trading advisor and commodity pool operator. This registration is administered through the National Futures Association (“NFA”). Further, ReSolve Global is a registered person with the Cayman Islands Monetary Authority.