Welcome to Graham Capital



Insight Series

A series of educational primers, visualizations, and videos on key themes within the alternatives industry.

Diversify and Conquer
Focusing solely on the Sharpe ratios of individual strategies - without considering their role within a broader portfolio - can increase the risk of amplified losses in volatile markets. In this short piece, we discuss how investors can strengthen the chances of preserving capital and enhance risk-adjusted returns by prioritizing diversification over the pursuit of individual winners.
Macro Hive Podcast Interview
with Ken Tropin
Graham's Founder and Chairman, Ken Tropin, recently shared his experience and insights on the hedge fund industry in a conversation with Bilal Hafeez, CEO and Head of Research for the UK-based Macro Hive podcast.
Pensions & Investments Interview
with Ken Tropin
Graham's Founder and Chairman, Ken Tropin, sat down with Pensions & Investments to share his thoughts on how Graham posted double-digit gains in a challenging 2022 by utilizing macro strategies to navigate recent market conditions.
The Need for
Dynamic Diversification
Market conditions and correlations continually change and can evolve rapidly. In the current investment landscape, strategies that can dynamically manage portfolio diversification when market correlations increase will be important to managing risk going forward.
Building Portfolio Resilience
at the Macro Level
Global macro emerged as a notable winner in 2022 amidst a dispersion in results across various alternative investment styles. Has this opportunity passed? When is the right time to allocate to macro? Here, we address some common questions for investors seeking to build a portfolio that is resilient to various market conditions.
The Benefits of
Non-Correlated Alpha
In the current investment landscape, there is a need for alternatives that can offer both positive returns and diversification to equities and bonds. Here, we outline the role of alternatives as investors face several notable challenges, including heightened market uncertainty, recent underperformance of a 60/40 portfolio, and elevated inflation.
Bloomberg Invest Interview:
Why Macro is Killing It
Kenneth G. Tropin, Graham's Founder and Chairman, speaks with Bloomberg's Erik Schatzker at Bloomberg Invest New York.
Graham 2022 Investment Symposium:
Video Replay
View the replay of Graham's 2022 virtual Investment Symposium, featuring comments from Graham's Founder and Chairman, Kenneth G. Tropin, President and CIO, Pablo Calderini, and CIO of Quantitative Strategies, Edward Tricker, Ph.D., as well as panel discussions with quantitative and discretionary investment team members.
Bloomberg Surveillance Interview
Featuring Ken Tropin
In this episode of Bloomberg Surveillance, Graham's Chairman and Founder, Kenneth G. Tropin, discusses discretionary and quantitative trading opportunities and managing risk in the wake Q3 2022 market events.
Bloomberg Masters in Business
Podcast Featuring Ken Tropin
Bloomberg Radio host Barry Ritholtz spoke with Graham's Chairman and Founder, Ken Tropin, on a recent episode of Bloomberg's "Masters in Business" podcast. Ken discusses his views on the past vs. the current market environment, inflation, future outlook, portfolio diversification and risk management, and the role of macro strategies.
Getting Back to "Normal":
Curbing Systemic Risk with Diversification
In this piece, we review how investors can structurally reduce left tail occurrences in their portfolio by incorporating diversifying strategies with positive skew characteristics and, ideally, a positive mean.
Global Macro Outlook
from Ken Tropin
Ken Tropin, Graham's Founder and Chairman, shares his perspective on the current market environment, outlook, and the role of macro strategies.
Trend-Following Primer
In this brief paper, we summarize the principal characteristics of trend-following and how the strategy can impact a broader investment portfolio, including a new section summarizing the types of traditional trend-following models.
2022 Macro Opportunity Set
In this post, we highlight key macro trading themes for 2022 and review the role of macro in the current investment landscape.
Video Release - Talking Hedge Panel:
Optimizing Investment Alpha through Customized Portfolios
We are pleased to share the video recording of the November 2021 Talking Hedge panel featuring Dr. Chris Jones, Managing Director, Portfolio Solutions and Research, alongside other esteemed industry professionals. The panel discusses the various implementation considerations of customized portfolios from both a manager and an allocator perspective.
Interpreting Correlation: Proceed with Causation Caution
Correlation is one of the most widely used measures of diversification and can be a helpful statistical indicator for investors looking to construct a diversified portfolio. However, there are complexities in analyzing correlation and investors should use caution in interpreting it.
Bond Returns: Looking Back to the Future
Investors have had strong returns using bonds as a diversifier over the last 10 years, but this may not continue in the next 10 years.
The Whole is Greater than the Sum of the Parts
With thoughtful portfolio construction, investors can potentially achieve significantly better returns at the portfolio level than can be expected from the individual component strategies.
Operational Due Diligence Trends
The COVID-19 pandemic upended traditional onsite operational due diligence ("ODD") reviews. Beyond shifting to virtual ODD meetings, investors' review priorities evolved in real-time as specific business risks changed. Here, we outline key changes to controls assessments that stood out...
Discretionary Macro Review and Opportunity Set
Following the backdrop of global economic uncertainty and heightened market volatility in 2020, we review discretionary macro from a historical perspective and explore the current outlook for the strategy.
Flexible Average Inflation Targeting: FAIT and the Fate of Investor Allocations
The Fed's new FAIT framework provides forward guidance for a prolonged period of low rates. Here, we review the Fed's new strategy and its implications for investor allocations.
Faith No More: Alternatives to Fixed Income
Historically low yields and elevated bond prices may produce less compelling fixed income returns and diminish safe haven benefits going forward. In this uncertain economic landscape, will diversification benefits be less reliable for investors?
Trend-Following: What's Vol Got To Do With It?
Trend-following can perform well in both high and low volatility environments. It is the existence of sustained market trends that preconditions positive performance.
Correlation is Dynamic: Stock/Bond Correlation
It is common practice to offset equity risk in an investment portfolio with an allocation to bonds. But this may not always provide the diversification you expect..
The Power of Market Diversification
Market diversification is essential to improving the potential risk-adjusted returns, and combining assets with lower correlations to each other often results in superior performance.
Diversification: Accomplishing More with Less
More markets does not mean more diversification. Adding markets only benefits performance up to a point. Here's why.
Quantifying Market Directionality
Performance of trend and macro directional strategies often depend on the existence of sustained directional moves in markets. Here, we quantify this directionality.
Directional vs Cross-Sectional Market Neutrality
Both strategies demonstrate strong diversification and performance benefits. However, each approach has unique characteristics that should be considered when adding to a traditional portfolio.