Mark Rzepczynski on Trend, Alternative Diversifiers, and Manager Selection

Nov 14, 2022

It was our great privilege to welcome Mark Rzepczynski this week. Mark has over 25 years of experience in financial markets, is a former finance professor and writes frequently about global markets and quantitative investing. Our conversation covered:

• His early years, ‘forged in the chaos of the trading pits’
• Pursuing a PhD and recognizing a career in research was not for him
• Working for John Henry – an apprenticeship in trend following
• Finding one’s comparative advantage and sticking to it
• Why trend following had a bad reputation when the Efficient Market Hypothesis (EMH) was still regarded as the law of the land
• Trend following as the first derivative of the EMH
• Understanding how markets actually behave, as opposed to how they should
• Prices are primal
• Uncertainty as the gap between what you don’t know and what you should know
• The interplay between price action and narrative
• Specialists can be tremendously myopic, while trend followers seek to be the ultimate, rules-based generalists
• Black Box vs Glass Box
• Trend following as a signal to noise problem
• The dirty secret of trend-following – when most of the money is actually made
• And much more

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 Inc.

 

*ReSolve Global Inc. 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 Inc. is a registered person with the Cayman Islands Monetary Authority.