24 Comments

Interesting idea for an article! :D

I've been saying for a while now but drawdown control is important and it pays to think about how to reduce drawdowns to maximise your risk-adjusted returns.

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Jun 21Liked by Conor Mac

Great article, but probably isn't so much applicable to a middle age young retiree with a modest portfolio where short term tends to more of a factor than long term goals.

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This is a masterpiece 👍

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Jun 19Liked by Conor Mac

very interesting piece. two things i thought are interesting:

1) for the LO god portfolio, if we exclude the Great Depression years, max drawdown improves quite a bit

2) maybe im misunderstanding the setup of god's HF portfolio, but if one is able to foresee the future, and always be longing the top decile performers and shorting the bottom decile performers, how is it possible for this portfolio to lose money, let alone -40% drawdown? essentially isnt this the "perfect" market neutral portfolio, in which the long book by definition always outperforms the short book, hence always generate a positive return?

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Jun 15Liked by Conor Mac

Good one. You should also check out AA's pieces on combining value with momentum if you haven't already. Great pic, dall-e?

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The hero we needed!

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Great article! Interesting lesson!

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Jun 13Liked by Conor Mac

After a bad year he would rely on his AI and name it Connie and she would then blind him with science. :-)

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Great piece. Every investor should read it. Digest it. Embody it.

Small aside: did you mean to write “top-decline” performers or “top-decile”? I wasn’t sure.

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If God were a HF manager he would ban them from the Gates of Heaven & provide them w/ a - way ticket to Hell.

The shelf life if the average HF relative to their fee intake has been nothing short of free money without accountability only to see them start up under another name.

Could go on but - my message is pretty clear. The average investor has been better off in a standard index fund tracking performance for marginal fees over time.

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