Alternative Investments | Part One: There is Real Value in Non-Traditional Assets and Special Commodities

Unfiltered Finance

Today, we talk about an area of the market that many people have heard of, but haven’t chosen to invest in as of yet. Specifically, we’re talking about “Alternative Investments” - investment strategies that are different from and diversifying to, traditional asset classes. In this first half of this two-part episode, our own Tom Romano is joined by Symmetry’s Phil McDonald, CFA, CAIA, Managing Director of Research Investments & Portfolio Manager, to further define what “Alternative Investments” are, and why you may want to consider their potential benefits.

If you have any questions or would like more information, reach out to us at https://symmetrypartners.com/contact-us/

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Symmetry Partners, LLC, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered, excluded or exempted from registration requirements. Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. No one should assume that future performance of any specific investment, investment strategy, product or non-investment related content made reference to directly or indirectly in this material will be profitable. As with any investment strategy, there is the possibility of profitability as well as loss. Due to various factors, including changing market conditions and/or applicable laws, the content may not be reflective of current opinions or positions. Please note the material is provided for educational and background use only. Moreover, you should not assume that any discussion or information contained in this material serves as the receipt of, or as a substitute for, personalized investment advice. Transcript

0 00:00:06.730 --> 00:00:10.400 Hello and welcome to Unfiltered Finance. This is your host, Tom Romano.

1 00:00:10.400 --> 00:00:12.160 Thank you for joining us. Uh,

2 00:00:12.160 --> 00:00:15.000 we have a special episode today where we want to talk about, uh,

3 00:00:15.000 --> 00:00:19.400 an area of the market that, uh, a lot of investors have probably heard of, uh,

4 00:00:19.620 --> 00:00:22.640 and probably most investors don't have a lot of exposure to.

5 00:00:23.180 --> 00:00:25.200 And that is alternative investments.

6 00:00:25.780 --> 00:00:29.200 And I have the perfect guest for us here today. Uh, Phil McDonald,

7 00:00:29.300 --> 00:00:33.040 who is a portfolio manager and the managing director of investments at Symmetry

8 00:00:33.040 --> 00:00:35.360 Partners, and is the resident expert on,

9 00:00:35.580 --> 00:00:39.360 on alternative investing here at Symmetry. So Phil, thanks for joining us today.

10 00:00:39.700 --> 00:00:41.280 Thanks for having me. I'm happy to be here.

11 00:00:41.900 --> 00:00:45.080 So I kinda wanna start very high level, Phil, um,

12 00:00:45.080 --> 00:00:49.200 because I think alternative investments is a, is a very, very broad topic.

13 00:00:49.400 --> 00:00:51.760 I mean, it can cover things, uh,

14 00:00:51.760 --> 00:00:55.760 such as precious metals to hedge fund strategies, um,

15 00:00:55.780 --> 00:00:59.760 all the way down to things like NFTs, right? Or, or even, you know,

16 00:00:59.760 --> 00:01:04.240 card collecting to an extent, right? So if you could just very high level give,

17 00:01:04.240 --> 00:01:08.520 give us a very broad definition, uh, on your view on alternative investing,

18 00:01:08.520 --> 00:01:09.020 please.

19 00:01:09.020 --> 00:01:09.720 And thank you that,

20 00:01:09.720 --> 00:01:14.680 that is a highly relevant question because alternatives is one of those labels

21 00:01:14.680 --> 00:01:17.760 and investing that doesn't have, uh,

22 00:01:17.880 --> 00:01:21.080 a perfectly agreed upon definition. I think, you know,

23 00:01:21.080 --> 00:01:24.640 certain people hear it and they think different things. Um,

24 00:01:24.800 --> 00:01:29.200 I think a useful definition to keep in mind is really, uh,

25 00:01:29.200 --> 00:01:33.080 the starting point is anything that is an investment strategy that is different

26 00:01:33.390 --> 00:01:37.800 from or diversifying to traditional asset classes that is

27 00:01:38.100 --> 00:01:41.080 equity and fixed income, right? Um,

28 00:01:41.180 --> 00:01:45.440 but I think you can't really stop there because, you know,

29 00:01:45.460 --> 00:01:48.840 you called attention to, to certain ideas that, you know,

30 00:01:48.840 --> 00:01:52.040 people might think of if, you know, you mentioned alternative investing,

31 00:01:52.320 --> 00:01:54.960 you know, baseball cards or, you know,

32 00:01:54.960 --> 00:01:58.520 a lot of interesting different artwork choices. Yeah. We've talked about,

33 00:01:58.520 --> 00:01:58.840 talked about

34 00:01:58.840 --> 00:01:59.270 That before.

35 00:01:59.270 --> 00:02:04.080 Cars, uh, timber farmland, you know, these are all, some,

36 00:02:04.320 --> 00:02:06.640 a lot of people think real estate, right? Which I think we could,

37 00:02:06.640 --> 00:02:07.600 we could debate that one,

38 00:02:07.700 --> 00:02:12.520 but I think not only should the investment strategy be different, but there,

39 00:02:12.530 --> 00:02:17.240 there should be kind of an economic rationale for why you might

40 00:02:17.510 --> 00:02:21.480 earn a return on that different strategy. And, and more specifically,

41 00:02:22.670 --> 00:02:27.560 where's the premium coming from? Right? So I think very quickly for me,

42 00:02:27.560 --> 00:02:31.600 that collapses down more to specific liquid,

43 00:02:32.380 --> 00:02:34.560 uh, investment in trading strategies.

44 00:02:34.950 --> 00:02:38.800 Sometimes based on themes we're al already familiar with in,

45 00:02:38.820 --> 00:02:40.640 in asset classes we're already familiar with.

46 00:02:40.640 --> 00:02:45.480 You don't necessarily have to go really far a field to find an

47 00:02:45.760 --> 00:02:49.480 addition to a portfolio that will, will make a difference in terms of, you know,

48 00:02:49.480 --> 00:02:51.920 adding an alternative, uh, investment exposure.

49 00:02:52.630 --> 00:02:55.560 Sure. Thank you for that. And, um, you know,

50 00:02:55.560 --> 00:02:58.680 I think it is that broad of a definition, right? I mean, uh,

51 00:02:58.990 --> 00:03:02.800 just to sort of clarify for, for our listeners, um,

52 00:03:02.860 --> 00:03:06.000 the word alternative means alternative, you said traditional asset classes,

53 00:03:06.460 --> 00:03:08.040 stocks, bonds.

54 00:03:08.610 --> 00:03:13.080 There is a correlation benefit to owning both stocks and bonds in a portfolio

55 00:03:13.270 --> 00:03:16.840 Most years. Most years. Yeah. We'll get to that. We will get to that. Um,

56 00:03:17.390 --> 00:03:20.640 however, um, you know, alternatives, to me it is a,

57 00:03:20.640 --> 00:03:25.280 it's a correlation story in, in all of those investments, if you will,

58 00:03:25.280 --> 00:03:30.200 whether it's cars, stamps, baseball cards, commodities,

59 00:03:30.670 --> 00:03:35.480 they are going to have or should have some sort of diversification benefit.

60 00:03:35.540 --> 00:03:37.000 And that's the purpose of it, right?

61 00:03:37.750 --> 00:03:39.200 Totally. You, you nailed it.

62 00:03:39.260 --> 00:03:44.120 The diversification benefit of an alternative strategy performing alternatively,

63 00:03:44.130 --> 00:03:46.480 right? So if you wanna get a little bit geeky, you know,

64 00:03:46.480 --> 00:03:50.160 you can think about something whose return stream looks different. So, you know,

65 00:03:50.220 --> 00:03:54.920 low correlation and expected return from that, you know, economic logic,

66 00:03:55.030 --> 00:03:58.760 that underlying fundamental theme as to if I do this trading strategy,

67 00:03:58.880 --> 00:04:03.760 I should expect a return, hopefully lower volatility than, than say,

68 00:04:03.920 --> 00:04:08.840 a equity market. So right there, you, you can talk about high sharp ratios or,

69 00:04:08.860 --> 00:04:12.560 you know, high excess returns relative to the volatility you're talking about.

70 00:04:12.780 --> 00:04:17.760 And, and absolutely diversification is the benefit. Very often, I, I, you know,

71 00:04:17.900 --> 00:04:21.520 use the, um, analogy of, you know, a third bucket of diversification.

72 00:04:21.540 --> 00:04:23.840 All you thought really all you had was two, well,

73 00:04:23.840 --> 00:04:27.760 there's this third bucket you might want to consider for some clients. And,

74 00:04:27.820 --> 00:04:31.240 and one, one thing I want to clarify here on, on this topic while we're here,

75 00:04:31.710 --> 00:04:35.040 most of these strategies are not a hedge,

76 00:04:35.500 --> 00:04:37.360 diversification is not a hedge.

77 00:04:37.820 --> 00:04:41.000 So if you're diversified with regard to, you know,

78 00:04:41.020 --> 00:04:45.600 equity markets and volatility, it doesn't mean when equities go down 10%,

79 00:04:45.780 --> 00:04:49.680 you go up 10%. It's not that directly, you know,

80 00:04:49.950 --> 00:04:53.360 inverse of a relationship. It's unrelated, you know,

81 00:04:53.360 --> 00:04:58.240 it's not sensitive to what the equity or fixed income market hopefully is doing.

82 00:04:58.420 --> 00:05:00.080 That's really what diversification is.

83 00:05:00.380 --> 00:05:03.360 So it's not the taking the, the counterpoint, if you will, right?

84 00:05:03.390 --> 00:05:08.240 Like something zigs this must zag, so to speak. Right? And so the idea is, it,

85 00:05:08.350 --> 00:05:13.240 it's not going to behave from a return standpoint like any other,

86 00:05:13.260 --> 00:05:17.080 it shouldn't behave like any other asset classes you currently have in your

87 00:05:17.080 --> 00:05:20.680 portfolio. And I really like the way you put that sort of a, a third bucket,

88 00:05:20.680 --> 00:05:24.640 right? I I maybe even a fourth, right? Because I think of cash. Yeah, exactly.

89 00:05:24.700 --> 00:05:29.160 So, so most investors have cash, bonds and stocks,

90 00:05:29.270 --> 00:05:31.120 most of their 401ks. And so what you're saying,

91 00:05:31.120 --> 00:05:35.200 there's this whole other realm of alternatives that can have

92 00:05:36.140 --> 00:05:40.880 diversification benefits because of the fact that they don't behave like stocks,

93 00:05:41.170 --> 00:05:43.120 bonds, and cash. Correct.

94 00:05:43.980 --> 00:05:48.880 So let's talk a little bit because I think alternatives sometimes get a bad

95 00:05:48.980 --> 00:05:52.120 rap. Um, I think a lot of it has to do with the,

96 00:05:52.260 --> 00:05:54.720 so maybe the broad definition has something to do with it,

97 00:05:54.780 --> 00:05:56.920 but let's just kind of pick it apart with some of the,

98 00:05:57.010 --> 00:06:00.920 the arguments I've heard from, uh, investors and financial advisors alike.

99 00:06:00.920 --> 00:06:03.400 And the first one that comes to mind is cost, right? You know,

100 00:06:03.400 --> 00:06:04.040 you think hedge funds,

101 00:06:04.040 --> 00:06:08.160 you think two 20 or three and 30 where you're the managers earning, you know,

102 00:06:08.180 --> 00:06:10.040 2%, 3% plus a,

103 00:06:10.160 --> 00:06:13.360 a large portion of the profits talk to us a little bit about cost with

104 00:06:13.360 --> 00:06:14.090 alternatives,

105 00:06:14.090 --> 00:06:17.920 Right? And that I think is a fair critique of,

106 00:06:18.320 --> 00:06:20.960 I dunno if I wanna call it a traditional model of alternative investing,

107 00:06:20.960 --> 00:06:24.320 maybe older model where some of this, these strategies started mm-hmm.

108 00:06:24.490 --> 00:06:26.840 Which really only offered in limited partnerships,

109 00:06:27.290 --> 00:06:29.760 which tend to have high minimums, you know,

110 00:06:29.760 --> 00:06:33.880 so only high net worth folks can qualify for them. They're illiquid.

111 00:06:34.180 --> 00:06:38.000 So capital could be tied up for something even up to 10 years opaque,

112 00:06:38.060 --> 00:06:41.880 you're not really sure what the manager is doing and, and expensive, you know,

113 00:06:41.880 --> 00:06:42.640 even, you know,

114 00:06:42.640 --> 00:06:46.240 sometimes you have like fund to funds and feeder funds and you have layers of

115 00:06:46.240 --> 00:06:49.440 fees, and then obviously those, those performance fees come into play as well.

116 00:06:50.180 --> 00:06:54.560 Um, so the good news is that that's not the only way to access alternative

117 00:06:54.560 --> 00:06:56.360 strategies. Now, you,

118 00:06:56.580 --> 00:07:00.720 the investor is able to invest in mutual funds and even ETFs that offer

119 00:07:00.950 --> 00:07:04.520 alternative strategies for the most part, liquid, transparent, you know,

120 00:07:04.520 --> 00:07:07.920 you get all the benefits of, you know, the regulatory requirements of,

121 00:07:07.940 --> 00:07:09.880 of being a fund in these structures.

122 00:07:10.580 --> 00:07:14.920 Not all strategies live well in that liquid structure.

123 00:07:15.380 --> 00:07:19.240 So, you know, you don't have quite literally that list of, you know,

124 00:07:19.240 --> 00:07:21.760 that funny list of all the things we could think of that someone might think of

125 00:07:21.760 --> 00:07:25.240 as, as a good investment. So you, you are more constrained,

126 00:07:25.300 --> 00:07:28.760 but still there's quite a bit to, to choose from. And then, you know,

127 00:07:28.760 --> 00:07:29.593 to your point,

128 00:07:29.710 --> 00:07:33.040 most of those strategies are just gonna have a very straightforward expense

129 00:07:33.170 --> 00:07:37.960 ratio on the fund. It'll be very clear what the investor has to pay on average.

130 00:07:38.340 --> 00:07:43.040 You typically see higher fees than, you know, a traditional say,

131 00:07:43.210 --> 00:07:47.320 index fund for equity or, or, or fixed income. But you,

132 00:07:47.320 --> 00:07:51.560 you're getting something different in, in a well-managed alternative strategy,

133 00:07:51.610 --> 00:07:54.280 Right? And you hit on a couple of of points there, right?

134 00:07:54.310 --> 00:07:57.040 Cost is something that always comes up. And uh,

135 00:07:57.200 --> 00:08:01.240 I understand that even in some of these ETF or mutual fund type vehicles,

136 00:08:01.270 --> 00:08:03.280 that there, there could be a higher layer of cost,

137 00:08:03.280 --> 00:08:08.160 but there are ways to get exposures to these asset classes without paying

138 00:08:08.580 --> 00:08:13.480 two and 20. Mm-hmm. Right. Um, you also mentioned liquidity, right?

139 00:08:13.600 --> 00:08:15.080 I think that gets solved for,

140 00:08:15.580 --> 00:08:18.680 if you're not using a limited partnership sort of vehicle.

141 00:08:19.300 --> 00:08:21.880 If you're using an etf, they're very, very liquid.

142 00:08:22.140 --> 00:08:24.520 So you can get your money whenever you may need it.

143 00:08:24.540 --> 00:08:27.800 But you also hit on something that I think is, I think,

144 00:08:27.800 --> 00:08:30.600 important to investors and it's transparency, right?

145 00:08:30.700 --> 00:08:32.880 The opacity of a hedge fund, traditional,

146 00:08:33.100 --> 00:08:37.360 if I can use the word traditional hedge fund tends to be a little bit, uh,

147 00:08:37.370 --> 00:08:41.280 black boxy, if you will, right? Right. And maybe investors are thinking of,

148 00:08:41.620 --> 00:08:44.160 you know, things like Bernie Madoff or things like that, right?

149 00:08:44.160 --> 00:08:45.800 Where you don't know what's going on under the hood,

150 00:08:45.940 --> 00:08:49.440 but an ETF or a mutual fund,

151 00:08:50.260 --> 00:08:54.760 an ETF specifically, you're gonna get a a lot of transparency in that. Correct?

152 00:08:55.030 --> 00:08:55.320 Yeah,

153 00:08:55.320 --> 00:08:55.900 Absolutely.

154 00:08:55.900 --> 00:08:57.080 So you know exactly what you're holding.

155 00:08:57.250 --> 00:09:00.720 Absolutely. And, and, uh, you've touched upon a point,

156 00:09:00.730 --> 00:09:03.560 which I think is very relevant,

157 00:09:03.660 --> 00:09:08.480 and thankfully there's been an evolution in the industry to kind of bring

158 00:09:08.480 --> 00:09:10.960 attention to some of that. So the,

159 00:09:11.100 --> 00:09:14.280 the idea of a global macro go anywhere,

160 00:09:14.410 --> 00:09:19.240 hedge fund a star manager who, you know, returned a thousand percent last year,

161 00:09:19.780 --> 00:09:23.640 you know, raising funds, just like in telling investors, I'm really smart.

162 00:09:23.820 --> 00:09:26.760 I'm smarter than all the rest. Invest with me.

163 00:09:26.790 --> 00:09:29.640 I'll find whatever the opportunity is globally, you know,

164 00:09:29.640 --> 00:09:32.240 regardless of country or region or asset class. Like,

165 00:09:32.360 --> 00:09:36.040 I will go find that opportunity and I will achieve a higher return. That,

166 00:09:36.740 --> 00:09:41.440 that's certainly something to probably be very careful of, right? He,

167 00:09:41.440 --> 00:09:44.920 he might wanna shy away from that. So over the last, I don't know,

168 00:09:44.920 --> 00:09:47.040 I'll say 25 years or so, there,

169 00:09:47.040 --> 00:09:49.840 there's been light kind of shown upon this idea that, you know,

170 00:09:49.840 --> 00:09:52.960 hedge funds don't hedge, you know, some hedge funds have a lot of beta,

171 00:09:52.990 --> 00:09:53.880 some hedge funds are,

172 00:09:54.020 --> 00:09:57.240 are implementing strategies you can get with liquid strategies. You know,

173 00:09:57.240 --> 00:10:00.920 this idea of hedge fund replication was, was an interesting arm of, uh,

174 00:10:00.920 --> 00:10:03.120 quantitative research. So I, I think for,

175 00:10:03.180 --> 00:10:07.000 for those who are interested and have the time as an alternative investor, you,

176 00:10:07.020 --> 00:10:10.880 you should be able to get from your manager a very specific explanation of

177 00:10:11.070 --> 00:10:13.800 exactly what's happening in the strategy,

178 00:10:14.980 --> 00:10:16.480 why it's an alternative strategy,

179 00:10:16.740 --> 00:10:19.440 why the fee being charged on that strategy makes sense,

180 00:10:19.660 --> 00:10:23.320 how it's diversifying to traditional asset classes. And really, I think at a,

181 00:10:23.320 --> 00:10:24.720 on a very basic level,

182 00:10:25.110 --> 00:10:30.040 confirm you're not paying alternative investment fees for

183 00:10:30.270 --> 00:10:32.120 just call it equity beta, right?

184 00:10:32.120 --> 00:10:36.080 Because we know equity beta is available in really high quality ETFs from

185 00:10:36.120 --> 00:10:38.840 Vanguard for probably three basis points. Yeah.

186 00:10:38.840 --> 00:10:42.880 I think that's a very important point, right? And, and we're firm believers on,

187 00:10:42.940 --> 00:10:47.440 on, on transparency. And if you're using alternatives correctly,

188 00:10:47.540 --> 00:10:49.000 if I'm understanding what you're saying,

189 00:10:49.260 --> 00:10:52.240 and it is a diversification play to ensure that you're getting that

190 00:10:52.240 --> 00:10:55.960 diversification, you need that level of transparency. And a lot of times, and,

191 00:10:55.960 --> 00:10:58.400 and we've read about this and talked about this in the past,

192 00:10:58.470 --> 00:11:02.200 sometimes these more opaque type strategies, you know,

193 00:11:02.200 --> 00:11:03.840 if equities are doing really, really well,

194 00:11:04.070 --> 00:11:07.920 they might be very correlated to equities at that very given point in time.

195 00:11:07.920 --> 00:11:12.400 And then the whole story of diversification kind of goes out the window,

196 00:11:12.400 --> 00:11:13.233 doesn't it?

197 00:11:13.240 --> 00:11:14.073 A hundred percent.

198 00:11:14.260 --> 00:11:19.200 And I think financial media hasn't helped in that education, right?

199 00:11:19.500 --> 00:11:23.920 So there's been stretches of time when equity markets were doing very well,

200 00:11:24.100 --> 00:11:27.800 and hedge funds haven't been, and, and you know, the storyline there is,

201 00:11:27.800 --> 00:11:31.280 you know, hedge funds failed. And well, if hedge fund,

202 00:11:31.500 --> 00:11:35.600 if a real alternative strategy has zero beta to the equity market and the equity

203 00:11:35.600 --> 00:11:36.920 equity market's doing well,

204 00:11:37.720 --> 00:11:42.280 I wouldn't necessarily expect to see those hedge funds up just because,

205 00:11:42.450 --> 00:11:43.640 Right? If, if the,

206 00:11:43.780 --> 00:11:47.480 if the alternative investment that you're using for diversification is zigging,

207 00:11:47.480 --> 00:11:49.240 while your equities are zigging, you

208 00:11:49.240 --> 00:11:50.280 Should ask questions. You should ask

209 00:11:50.440 --> 00:11:53.200 Questions. Absolutely. Absolutely. Well, let,

210 00:11:53.200 --> 00:11:56.000 let's talk a little bit about the performance, uh, of,

211 00:11:56.900 --> 00:11:59.720 of alternative investing in relation to portfolio.

212 00:11:59.860 --> 00:12:03.120 And you alluded to this in the beginning when, uh, you mentioned that, you know,

213 00:12:03.120 --> 00:12:07.880 sometimes stocks and bonds do behave alike. Mm-hmm. And we saw that in 2022,

214 00:12:07.880 --> 00:12:11.840 right? Yeah. Both had, uh, extremely volatile tough year,

215 00:12:12.350 --> 00:12:15.200 both ended up in, in the red. Um,

216 00:12:16.380 --> 00:12:18.360 how did alternatives do, or what,

217 00:12:18.360 --> 00:12:21.360 how did alternative asset classes perform during that timeframe?

218 00:12:21.860 --> 00:12:25.680 Uh, certain of them did reasonably well. So, uh, I'll,

219 00:12:25.680 --> 00:12:28.480 I'll maybe run through a few examples of, uh,

220 00:12:28.480 --> 00:12:31.900 strategies that are alternative. Uh,

221 00:12:31.900 --> 00:12:35.060 our diversified alternative investment approach would include.

222 00:12:35.280 --> 00:12:39.420 One of those is something called, uh, manage futures or trend following, or,

223 00:12:39.880 --> 00:12:43.500 you know, if you want to think about, you know, quantitative factor investing,

224 00:12:43.500 --> 00:12:48.020 which you know, is what we think about a lot, you can, you can consider that,

225 00:12:48.640 --> 00:12:51.660 um, longitudinal momentum or momentum over time.

226 00:12:51.920 --> 00:12:56.900 And this is really just a strategy that takes advantage of investing in futures

227 00:12:56.900 --> 00:13:00.660 and forwards. So derivatives that'll cover, you know, commodities,

228 00:13:00.760 --> 00:13:05.460 equity markets, fixed income markets. Uh, and in the simplest sense,

229 00:13:06.200 --> 00:13:10.100 if a trend in an asset class is up,

230 00:13:10.590 --> 00:13:14.900 especially over, you know, short, medium, and long-term time periods,

231 00:13:15.080 --> 00:13:18.580 the managed future strategy would essentially be long that exposure.

232 00:13:19.440 --> 00:13:22.380 And if a trend is down over, you know,

233 00:13:22.670 --> 00:13:27.500 short and long horizon managed future strategy would be short, uh,

234 00:13:27.500 --> 00:13:30.780 that asset class or commodity. So in 2022,

235 00:13:31.530 --> 00:13:35.100 when everything felt like it was going down and continuing down,

236 00:13:35.720 --> 00:13:39.820 the managed future strategy was able to reposition and be short,

237 00:13:40.290 --> 00:13:45.220 many of those strategies that were showing persistent negative price signals.

238 00:13:45.840 --> 00:13:49.580 So in 2022 a year when both equity and fixed income markets globally,

239 00:13:50.090 --> 00:13:51.900 generally speaking on a diversified basis,

240 00:13:52.010 --> 00:13:54.420 were down and very positively correlated,

241 00:13:54.730 --> 00:13:59.460 something like a managed future strategy was up, uh, strongly and,

242 00:13:59.460 --> 00:14:01.260 and very diversifying. That's

243 00:14:01.260 --> 00:14:01.740 Really interesting.

244 00:14:01.740 --> 00:14:06.740 And so would you'd have the same expectation if both stocks and bonds were

245 00:14:06.740 --> 00:14:09.580 up, that the mayor's future strategy might be down, or does it depend?

246 00:14:10.160 --> 00:14:10.993 It depends.

247 00:14:11.080 --> 00:14:14.900 So it depends on the strength of those signals and the persistence of those

248 00:14:14.900 --> 00:14:19.100 trends. So in, in certain stable, neutral, slow,

249 00:14:20.090 --> 00:14:24.900 generally up markets, those signals may be too choppy to, to make use of.

250 00:14:25.160 --> 00:14:28.940 And maybe if there's conflicting signals, say, you know,

251 00:14:29.560 --> 00:14:32.900 up in the short term, down strongly in the medium term,

252 00:14:33.000 --> 00:14:35.460 up slightly in the long term, you know,

253 00:14:35.460 --> 00:14:38.020 you can't always make sense of those quantitative signals and,

254 00:14:38.020 --> 00:14:42.260 and you might have no exposure in that type of underlying market or commodity or

255 00:14:42.260 --> 00:14:43.000 asset class.

256 00:14:43.000 --> 00:14:46.540 So that'll conclude part one of our, uh, conversation alternative investments.

257 00:14:46.610 --> 00:14:49.300 Phil, thanks for joining us. And for our listeners, uh,

258 00:14:49.300 --> 00:14:50.900 if you're looking for additional information,

259 00:14:51.160 --> 00:14:54.920 please feel free to visit our website, www.symmetrypartners.com,

260 00:14:55.260 --> 00:14:58.400 and to access more of the Unfiltered Finance podcasts.

261 00:14:58.580 --> 00:15:01.800 Please feel free to find us wherever you're getting your podcast today.

262 00:15:02.020 --> 00:15:03.480 Be sure to stay tuned for part two.

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