Capital Allocators – Inside the Institutional Investment Industry

Tom Bushey is the founder of Sunderland Capital, a Boston-based hedge fund he started in 2016. Tom graduated from the Wharton School as an undergraduate, and worked as an investment banker at Credit Suisse First Boston, private equity analyst at Thayer Capital, hedge fund analyst at Millenium and Mayo Capital, and portfolio manager at Blackrock before trying his hand on his own. Even with that stellar resume, the road to success running an asset management business has plenty of obstacles along the way. Our conversation tells Tom's story of what happened through his career and launch process. He shares an inside look from a manager's perspective of what it takes to get a fund off the ground. As an important aside and disclaimer, I've known Tom for a while and have advised him for the last two years. I happen to like him a lot, both personally and professionally, but you should know I have a small vested interest in his success.

Mark Baumgartner is the CIO of the Institute for Advanced Study, where he oversees a $1 billion portfolio that seeks to achieve just median returns but with significantly less risk. Prior to joining IAS, Mark had stints at the Ford Foundation overseeing risk, at Morgan Stanley's Alternative Investment Partners, at both quantitative and qualitative hedge funds, and as a management consultant. Oh, and he studied to be a rocket scientist before that. Our conversation covers Mark's path to IAS and the principles of luck, risk, and uncertainty on that path. We discuss the IAS portfolio, one catered to achieve a low risk profile, and how he has stayed the course when that structure hasn't been rewarded by markets. We talk about identifying managers that fit into his approach and different metrics of defining risk at both the manager and portfolio levels. Learn More Discuss show and Read the Transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Join the Capital Allocators Forum Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

My guest on today's show once again is Annie Duke, decision-making expert, former world-famous poker player, and author of the best seller, Thinking in Bets. I had a chance to interview Annie at The Investment Institute's Fall Forum in Chapel Hill, North Carolina and the live interview follows. Special thanks to Andrea Szigethy and Donna Holly, founders of the Institute, for having Annie and me down for their terrific event. Our conversation covers the challenge of separating signal from noise in making decisions, the formation and confirmation of beliefs, forming decision groups, communicating with teams, and mistakes Annie's advisory clients have made after reading her book. We close with some questions from the audience and end with two great poker stories of how Annie approached being a woman in the male-dominated poker world. Annie's irrepressible brain was on display this time around, covering a few of the same ideas from our last conversation and some new ones with different anecdotes along the way. Learn More Discuss show and Read the Transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Join the Capital Allocators Forum Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Michael Lombardi is a thirty-year veteran of professional football, including as a General Manager and a three-time Super Bowl winning executive. He is the author of the fantastic recently released bookGridiron Genius, A Master Class in Winning Championships and Building Dynasties in the NFL. The book is a tour de force of applied leadership through his learnings working alongside football greats Bill Walsh, Al Davis, and Bill Belichick. Since stepping aside from the front office to write his book, Michael appears as a commentator on television, hosts the top-ten sports podcast, GM Street, and speaks to businesses about leadership and teamwork. Our conversation covers his early passion for football, the contrasting leadership styles of Bill Walsh and Al Davis, the magic of Bill Belichick, the four areas of leadership, the science and art of scouting, and where the front office breaks down. Michael embodies the style of leader that he describes, and his lessons are applicable to investment and business leaders alike. Learn More Discuss show and Read the Transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Join the Capital Allocators Forum Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Last week, the senseless and tragic events at the Tree of Life Synagogue in Pittsburgh left me and many others asking questions about our world today. This one hit a little closer to home for me than the many other equally terrible events that have occurred because my mother grew up in Squirrel Hill. Our family is a generation removed and not closely connected to the town anymore, but my friends Andy Fisher and Jeff Solomon very much are. Andy is the President of CIM Investment Management in Pittsburgh, where he has worked for a quarter-century and oversees $1.4 billion. He was born and raised in Squirrel Hill and lives a few blocks from the Tree of Life Synagogue. Andy sent me an email last Monday with a clip from an interview that our mutual friend Jeff conducted on MSNBC. Jeff is the CEO of Cowen Group and is a proud Pittsburgh and Squirrel Hill native. He was also the guest on the 9th Episode of Capital Allocators, and you can find a replay right after this special episode. I sat down with Jeff last Wednesday to talk about his experience in the initial days of these tragic events. That conversation follows. I want to offer a special thanks to Andy for the thread that led to this episode, and offer prayers and healing to Andy, Jeff, their family and friends directly impacted in Squirrel Hill, and to everyone I don't know wherever acts of hated have impacted their lives.

Jeffrey Solomon is the President of publicly listed Cowen Group (TK: COWN), a financial services company focused on supporting and providing active management to the marketplace. After graduating from the University of Pennsylvania in 1988, Jeff deferred an acting career with a brief respite on Wall Street, but he hasn't looked back since. In 1994, he joined Peter Cohen, then the former head of investment bank Shearson Lehman Brothers, to form money management firm Ramius Advisors. Ramius grew to become one of the largest hedge funds in the world, and in 2009 merged with boutique investment bank Cowen Group. Following the merger, Jeff switched over to the investment bank side of the business and today serves as its Chief Executive Officer, where he embodies the firm's core values of vision, tenacity and empathy. Our conversation starts with a passionate description of Pittsburgh sports, and flows to how active managers succeed in the 1990s and need to evolve to succeed today. We discuss the importance of empathy in the investment business, and touch on how Jeff's summer camp experience as a kid informs how he manages people today. His answers to my closing questions are just amazing. If you're short on time, fast forward to the 51stminute of the show. You'll miss plenty along the way, but you don't want to miss these. Please enjoy my conversation with Jeff Solomon. Learn More Discuss show and Read the Transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Join the Capital Allocators Forum Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Karl Scheer is the Chief Investment Officer of the University of Cincinnati's billion-dollar endowment. Before taking the helm at Cincinnati in 2011, he co-ran a family office and spent eight years in the venture capital industry. Our conversation covers Karl's background, running a family office in the teeth of the Global Financial Crisis, high-functioning governance, avoiding the worst managers, taking the hard road, conducting due diligence with popular managers and without checklists, and picking your spots. Book Links John Brooks, Once in Golconda: A True Drama of Wall Street 1920-1938 Edward Chancellor, Devil Take the Hindmost: A History of Financial Speculation John Brooks and Michael Lewis, The Go-Go Years: The Drama and Crashing Finale of Wall Street's Bullish 60s Learn More Discuss show and Read the Transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Join the Capital Allocators Forum Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Andrew Tsai is the Chief Investment Officer of Chalkstream Capital Group, which he founded in 2003 to manage the assets of quant guru Peter Muller. Andrew's fascinating background started on the Lehman arbitrage desk in the early 1990s, after which he formed a quantitative hedge fund in 1997, built a dot.comlogistics business in 1999, and led the turnaround of a private equity-backed business thereafter. He combined his wide range of skills to focus on investing at Chalkstream. Our conversation walks through the stories and lessons from Andrew's background and turns to Chalkstream. His investment program is the opposite of asset allocation, emphasizing deep dive research, concentrated themes in niche spaces, low beta, long tails, and culture. We close by fleshing out examples of Chalkstream's themes in Japan and electricity trading. Learn More Discuss show and Read the Transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Join the Capital Allocators Forum Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Michael Schwimer is the CEO of Big League Advance, a company that makes investments in Minor League baseball players in exchange for an agreed-upon percentage of their future earnings. Before founding BLA, Michael was a professional baseball player, working his way through the minors and reaching the majors as a pitcher for the Philadelphia Phillies. A shoulder injury left him pondering what to do next, which led to the creation of BLA. Our conversation discusses Michael's career as a player, the difficult life of Minor Leaguers, and his mission to improve their fortunes. We discuss his passion for statistics, application of Sabremetrics, and development of a team of All-Stars in the game of sports analytics. We close with a look into the future of BLA and Michael's prediction for this year's World Series Champion. Whether his bet proves right or wrong, Michael's rationale exemplifies second order thinking through the lens of data analytics that is never far from his mind. Learn More Discuss show and Read the Transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Join the Capital Allocators Forum Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Michael Batnick is the Director of Research at Ritholz Wealth Management, author of theIrrelevant Investor blog, co-host of the Animal Spirits podcast, and recently, author of his first book, Big Mistakes: The Best Investors and Their Worst Investments. Our conversation starts with Michael's atypical career path, his arrival at Ritholz, and his blog. We then turn to stories from his book about Ben Graham, Jesse Livermore, Jack Bogle, Stan Druckenmiller, John Maynard Keynes, Charlie Munger, and Chris Sacca. Lastly, we discuss how Michael applies the lessons in his book at Ritholz. Michael is a widely followed rising star in financial social media, and our conversation is packed with nuggets of timeless investment wisdom. Learn More Discuss show and Read the Transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Join the Capital Allocators Forum Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

After getting some great feedback from the replay of my conversation with Scott Malpass, I am going to repeat some gems from the past every few months. This week I picked out my conversation with Andy Golden, the venerable head of Princeton's 24 billion dollar endowment. It's another master class in endowment management from a seasoned veteran. Andy Golden is the President of Princeton University's Investment Management Company (PRINCO). Having grown from $3B at the time of his arrival in 1995 to $22.5B today, PRINCO has been among the highest performing endowments in the world. Andy came to PRINCO from Duke Management Company, where he was an Investment Director, and received his formative training in the business working for David Swensen at the Yale University Investments Office. Andy currently serves on the fund Advisory Boards of several well-known private equity and venture capital managers, including Bain Capital, General Catalyst Partners, and Greylock Partners. He was a founding member of the Investors' Committee of the President's Working Group on Financial Markets and serves as a Trustee of the Princeton Area Community Foundation and Rutgers Preparatory School. Andy holds a B.A. in Philosophy from Duke University and an M.P.P.M. from the Yale School of Management. Our conversation discusses Princeton's endowment two decades ago and today, including its strategic advantages as an institution, shifts in thinking about asset allocation, decision making, team development, and partnership with managers. Andy's long tenure in his seat, insight, and wisdom provides a treasure trove of information about how a top endowment manager practices his craft, and his subtle wit always keeps things light. Learn more at www.PeterAttiaMD.com Connect with Peter on Facebook | Twitter | Instagram.

Raff Arndt is the Chief Investment Officer of Australia's AUZ$145 billion Sovereign Wealth Fund, the Future Fund. He trained as an engineer and dove into infrastructure policy at the beginning of Australia's privatizations in the late 1990s. After investing in the space for six year, he joined the Future Fund in 2008 to head the infrastructure team. Six years later, Raff became CIO. Our conversation spans all aspects of the management of a next generation institutional portfolio, including a one team, one portfolio philosophy, disaggregating beta and factors from skill in public markets, separating the impact of leverage and timing from skill in private markets, venture capital and co-investment opportunities in a large pool of capital, the option value of flexibility, the team required to make decisions in this format, compensation, fees, views on China, and the current market environment. Australia created the Future Fund only eleven years ago with a mandate to compound capital for 20 years before even contemplating withdrawals. It has been described to me as a pool of capital with the size and transparency of CalPERS and the sophistication of Yale. I'm sure you'll soon understand why. Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Professor Stephen McKeon spent six years out of college working in finance for venture-backed startups before returning to graduate school and earning his PhD in finance in 2011. Blending his interest and experience, Steve focuses his research on corporate finance, M&A, security issuance, and most recently, crypto assets, where he has become a leading academic authority in the nascent area. Our conversation starts with Steve's first job smack into the teeth of the tech meltdown in 2000 and his subsequent roles at a winery and a drone company. We then turn to his work as an academic in the world of crypto assets, walking through the thesis for security tokens. Steve presents a case for the future of security tokens that is tangible and achievable. Now that the noise from soaring crypto currency prices has died down, we can learn a lot from Steve about what blockchain technology may bring to investing in the years ahead. Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Both times I was interviewed (by Khe Hy and Patrick O'Shaughnessy) and shared those conversations on Capital Allocators, I made reference to a special experience I've participated in for the last five years called the Hero's Journey. The weeklong journey in the mountains of West Virginia provides a setting and platform for each participant to access their best self. Michael Mervosh is the deeply insightful Executive Director of the Hero's Journey Foundation, an organization he created that provides experiential learning opportunities for human development and transformation based on Joseph Campbell's mythic hero's journey. He has a passion and indescribable skill in enlivening the developmental process and fostering vitality, meaning and well-being in individuals, groups, and organizations. When not running programs or training others, Michael practices psychotherapy at the Nuin Center in Pittsburgh, where he has professionally resided for 25 years. Our conversation took place in the mountains towards the end of this year's journey and is quite different from those you may be accustomed to hearing on the show. We cover Michael's path to creating the experience, the myth of the Hero, lessons in how the world actually works, the call to adventure, perfectionism, uncertainty, fear, and poetry. If you're intrigued, I strongly encourage you to check out herosjourneyfoundation.org. Spaces are limited for the annual summer Men's and Women's Journeys, so sign up for next year's trip at the website or reach out to me. I intend to be back on the mountain next year and hope to see you there. Learn More Discuss the show and Read the transcript Join Ted's monthly Mailing List Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Book Links Phillip Shepherd, New Self, New World: Recovering Our Senses in the Twenty-First Century Joseph Campbell, The Hero with a Thousand Faces Jack Kornfeld, After the Ecstasy, the Laundry: How the Heart Grows Wise on the Spiritual Path Joseph Jastrab, Sacred Manhood Sacred Earth: A Vision Quest into the Wilderness of a Man's Heart

Sarah Williamson is the CEO of FCLTGlobal, a non-profit consortium of large asset managers, allocators, and corporations dedicated to encouraging long-term behavior in business and investment decision-making. FCLTGlobal conducts research, convenes business leaders, develops actionable tools, and generates broad awareness of ways in which a longer-term focus can increase innovation, economic growth, and future savings. Prior to joining FCLTGlobal in 2016, Sarah spent 21 years at Wellington Management Company, where she was most recently a Partner and Director of Alternative Investments. She started her career at Goldman Sachs, and had stints at the U.S. Department of State and McKinsey before joining Wellington. Our conversation beings with Sarah's career and turns to FCLTGlobal. We talk about potential improvements at the corporate level, including eliminating quarterly guidance, executive compensation, capital allocation, and Board dynamics, and then turn to the relationship between money managers and allocators, including fee structures, setting expectations, reporting returns, and governance. Lastly, Sarah discusses new research initiatives. I'm pulling for Sarah. If her work bears fruit, we all will be better off, and most importantly, so will our clients. Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Kristian Fok is the Chief Investment Officer of Australia's A46B ($35B USD) Construction & Building Industry Superannuation Fund, or CBUS. Prior to joining CBUS in 2012, Kristian spent 14 years consulting to Australian Super Funds at Frontier Advisors. Australia's Superannuation program mandates that employers contribute 9.5% of its employee salaries into a Super Fund, which is owned by the employee, like a 401k in the U.S., and grows with investment returns until retirement. The employees, in turn, have a choice of providers to invest their savings. The model has been one of the most successful in the world in preparing the population for retirement. Our conversation starts with Kristian's path to the CIO seat at CBUS and focuses on the hybrid investment model blending internal and external management. We discuss the transition to internal management as assets scale, example of CBUS' internal property company, economics of internal management, talent recruiting and retention, portfolio structure, external manager selection, people management, and investment with a long time-horizon. Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Josh Wolfe is the co-founder of Lux Capital, a $1.5 billion venture capital firm formed to support scientists and entrepreneurs who pursue counter-conventional solutions to the most vexing puzzles of our time. Josh's innovative thought process across his activities offers frameworks and insights applicable across the spectrum of investing. Our conversation covers Josh's early passion for science and finance, building a competitive advantage in venture capital from scratch, sourcing ideas, conducting due diligence, making investment decisions, constructing portfolios, making exits, learning from mistakes, navigating a challenging private equity environment, posting on Twitter, active vs. passive management, dinner table conversation, and life lessons. Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Ben Reiter is a senior writer for Sports Illustrated and the author of Astroball: The New Way to Win It All. He joined SI in 2004 a few years out of college and has written for them ever since. In 2014 Ben wrote a cover story for SI entitled YOUR 2017 WORLD SERIES CHAMPS featuring the then sorry Astros who were the laughingstock of baseball at the time. Three years later, his prediction came true. His book chronicling the journey has been dubbed Moneyball 2.0. Our conversation blew me away in how closely the parallels have been between baseball management and fundamental investing over the last 15 years. From the incorporation of data to the challenges in managing people, I suspect if you just change the names of the players and the labels for the process, this could be a full blown conversation about investing. Baseball may even be ahead of the data revolution in investing, and the story of the Astros could hint at lessons that money managers will need to apply going forward. Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Roz Hewsenian is the Chief Investment Officer of the $6 billion Helmsley Charitable Trust. Prior to joining Helmsley in 2010, Roz had a storied career in the industry, highlighted by her two decades of work as the consultant to CalPERS while at Wilshire Associates. Our conversation tracks Roz's career, including lessons from teaching children, the most important rule of management, successful investment consulting, taking time off, and joining Helmsley. We then turn to her current role and cover opportunistic-based allocation, theme identification, benefits of concentrating in managers, oversight of a team and due diligence, stories from the front lines, exciting investment opportunities, co-investments, and governance. Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Investment luminary Charley Ellis is the founder of Greenwich Associates, author of 16 books, and one of the most sought-after industry advisors worldwide. He also believes deeply in the paradox of skill and his latest book, The Index Revolution: Why Investors Should Join It Now, presents a compelling case for indexing for most investors.. Charley was an early guest on the show and we reconvened to talk through the full case of indexing for individuals and some of its constraints for institutions. Our conversation covers the case for indexing, smart beta, the retirement problem, investing in alternatives, private equity, and indexing challenges in emerging markets. After we turned off the recording, Charley proffered that we offer a prize for anyone who can find valid fault with the case against active management for most investors. Any takers can drop me an email, and I'll be happy to put them toe-to-toe with Charley to debate the issue. Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

Manny Friedman is the CEO of EJF Capital, a firm he co-founded in 2005 that manages $9 billion with a focus on the financial services industry. Manny started EJF after his retirement from Friedman, Billings, Ramsey Group, Inc., a company he co-founded in 1989 and served as Co-Chairman and Co-Chief Executive Officer. Our conversation looks back at Manny's lifelong passion for investing, the globalization of markets, and the financial crisis, and then looks forward at the newly created economic opportunity zones, long-term impact of government stimulus, stranded assets created by technological change, regulation, and philanthropy. Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

This replay is the one of the most downloaded shows from last year, and one that new listeners may have missed. Regular listeners no doubt might pick up a new insight listening again. Scott Malpass is the esteemed Vice President and CIO of Notre Dame University, where he oversees the school's $12 billion endowment. Scott earned his B.A. and M.B.A. degrees at Notre Dame, and returned to South Bend at the ripe age of 26 following a brief stint on Wall Street. His track record for almost 30 years, as defined by both performance and impact, place him indisputably in rare company at the very top of the field. Our conversation is a full-blown master class on endowment management, including the benefits of a long tenured team, asset allocation frameworks, passive management, preparing for dislocations, the state of venture capital, sourcing, monitoring and exiting managers, incremental process improvements, professional and personal development, and education and alignment across constituencies. It's hard not to be in awe of Scott's combination of humility, experience, and success. Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast

The name Anthony Scaramucci currently has 55% name recognition in the U.S. according to Politico. Anthony has been an entrepreneur in the hedge fund industry for 23 years, growing to prominence within the industry through his oversight of fund of funds Skybridge Capital, creation of the popular SALT conference, regular television appearances, and rejuvenation of the iconic television show Wall Street Week. He grew to prominence worldwide when his longtime political interests led to a brief tenure as White House Communications Director in 2017. Our conversation starts off with a bang and turns to the ups and downs in Anthony's career, including getting fired and rehired at Goldman Sachs, starting and selling his first hedge fund, creating Skybridge and watching it almost fail, and thriving after the financial crisis. We discuss Anthony's thoughts on hedge funds, lessons from his stint in Washington, and books he has written about his experiences. Along the way, he shares life lessons about managing people, building relationships, resiliency, laughing at yourself, greed, ego, and fame. Anyone who has only known Anthony from his recent public profile might be surprised to hear the depth of his insight, self-effacing honesty and caring of others, alongside his irrepressible salesmanship. Those who have known him longer will recognize the same Mooch as always in all his splendor. Learn More Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 2:48 – Anthony's professional history 8:03 – Time at Oscar Capital/Neuberger Berman 9:25 – Neuberger sells to Lehman 10:13 – Leaving Lehman to start Skybridge 13:13 – Getting through the financial crisis 14:04 – Launching SALT conference 15:35 – Buying Citigroup's fund of funds business 17:34 – Anthony's approach to the hedge fund business 20:28 – How he handles the relationships with managers 22:15 – Environment for the hedge fund space 24:12 – After the Music Stopped: The Financial Crisis, the Response, and the Work Ahead 26:02 – Hedge fund space moving forward 28:03 – What he learned from being fired 31:22 – Handling public adversity 32:40 – Selling the business to serve the country 35:35 – Life lessons learned throughout his career and shared in his books 35:40 – Goodbye Gordon Gekko: How to Find Your Fortune Without Losing Your Soul 38:40 – The Little Book of Hedge Funds 38:44 – Hopping over the Rabbit Hole: How Entrepreneurs Turn Failure into Success 39:20 – The key principles that Anthony tries to impart on his team 41:47 – Lessons in launching a hedge fund business 45:00 – What changed upon his return to Skybridge 46:33 – How does it feel to be famous 48:10 – Closing questions 56:06– The China Mission: George Marshall's Unfinished War, 1945-1947

Peter Troob is the co-Founder and CIO of Troob Capital Management, an opportunistic investor and family office with particular expertise in distressed situations. Prior to starting TCM in 2002, Peter spent six years focusing on distressed debt investing at Contrarian Capital and Everest Capital. He started his career as an investment banker, and after his tenure in self-proclaimed purgatory, he co-authored the entertaining book 'Monkey Business: Swinging Through the Wall Street Jungle." Our conversation begins with life as an investment banking analyst, and turns to competing with large distressed funds, the frothy high yield market, trickery in the CDS market, high yield ETFs, idiosyncratic opportunities, diversifying family assets, managing teams, and learning from the dinner table. Learn More Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 2:09 – Start of his career 3:02 – Peter's book Monkey Business 3:47 – The life of an investment banker 4:22 – Decision to leave the bank 4:50 – His experience at a hedge fund 5:27 – Some of his early mistakes 6:15 – The dynamics of distressed debt investing 8:05 – The appropriate size for a distressed fund 11:28 – What should your expectations be if you invest in a large fund 13:12 – Short credit thesis 18:00 – Impact of private equity owned companies on defaults 19:49 – Shenanigans we are seeing in the CDS market 24:36 – Concerns about high yield ETFs 26:42 – Investing family capital 29:16 – Sourcing idiosyncratic deals 32:49 – What Peter has learned about managing a team 35:43 – Hiring millennials 36:22 – Lessons from investing mistakes 43:05 – What is it like working with family 45:58 – Closing questions 49:56 - Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts

Australian James Aitken is the Founder and Managing Partner of Aitken Advisors, a one-man macroeconomic consultancy based in Wimbledon, England that works with approximately one hundred of the most influential pools of capital in the world. James started his career in 1992 as a foreign exchange trader, moved to London in May 1999, and in March 2002 joined the infamous AIG Financial Products team in London. In August 2006 he joined UBS, where he deployed his knowledge of the inner workings of the financial system to help his institutional investor clients successfully navigate their portfolios through 2007 and 2008. At the urging of his clients, James established his own firm in June 2009. Our conversation covers James' perspective on the Global Financial Crisis from his seat at its epicenter, the Eurozone crisis in 2011, subsequent process-driven opportunities in Greece, views on Central Banks in the US, China, & Europe, some brief observations on India, positioning for the current environment, and what makes a great macro manager. Learn More Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 3:03 – The start of his career at AIG Financial Products 7:19 – Move to UBS 9:03 – Influence: The Psychology of Persuasion 10:42 – Sell off of 2006 13:12 – Leaving UBS to go off on his own 24:22 – What makes a great manager 27:55 – What is he seeing in the markets today, especially the US Fed 33:09 – MIDROLL 34:08 – What happens when bond rates normalize 46:36 – China 56:50 - Japan 59:10 – Europe 1:05:28 – Risk in the asset markets 1:08:49 – Advice to allocators 1:11;05 – Why people should be focused on India 1:16:39 – How he spends his time 1:20:56 – Closing Questions

Brian Portnoy Brian is currently the Director of Investment Education at $100B investment solutions provider Virtus Investment Partners, where he strives to simplify the complex world of money in an effort to help investors make better decisions and lead a joyful life. For the past two decades, he has held senior investment, research, and strategy roles in the hedge fund and mutual fund industries at Chicago Equity Partners, Mesirow Financial, and Morningstar. Brian is the author of "The Investor's Paradox," a book about manager selection rooted in choice theory. His second book, "The Geometry of Wealth" hits electronic and physical bookstores this week. Our conversation covers Brian's experience in manager research and lessons learned, choice theory and managing expectations, differences between institutional investment and private wealth management, distinction between seeking wealth and trying to get rich, his terrific new book, and why volatility is risk. Brian's insightful take on investing and his journey from the complex to the simple is full of investment nuggets of gold. Learn More Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 2:24 – Brian's start in the business 5:18 – The useful skills he developed during his tenure at Morningstar 6:37 – The hard questions he would ask 7:15 – Why he left Morningstar 8:53 – What he learned at Mesirow that made him so detail oriented 10:57 – Leaving Mesirow 12:08 – What led Brian to writing The Investor's Paradox: The Power of Simplicity in a World of Overwhelming Choice 14:51 – The Art of Choosing 16:58 – What is the investors paradox 17:04 – The Paradox of Choice: Why More Is Less 19:29 – Reaction to the book 24:10 – Difference between his views on the asset management side vs the wealth management side 27:11 – The concept behind The Geometry of Wealth: How To Shape A Life Of Money And Meaning 30:58 – The shapes used to take people from confusion to comfort with money and investments, starting with the circle 36:00 – Moving on to the triangle in this formula 41:03 – The second triangle, focused on behavior 43:36 – The big blue square 49:29 – Hopes for the book 52:46 – Closing questions

Tom Lydon is one of the leading experts in the ETF and mutual fund industries. He is the founder and CEO of ETF Trends, a business he created in 2004 whose website, etftrends.com, is filled with news, analysis, and webcasts about the world of ETFs. Before creating ETF Trends, Tom ran a financial advisory and publication business that followed the mutual fund industry. Our conversation covers the evolution of mutual funds in the 80s and 90s and the rise of ETFs in the 2000s. We discuss the composition of the ETF marketplace, structure and tax advantages of ETFs, passive, factor and actively managed funds, characteristics of a superior manager, leveraged ETFs, VIX blowup, potential future problems in high yield and emerging market ETFs, and coming trends in the space. Learn More Discuss the show and Read the transcript Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 2:01 – A look at Tom's early career 4:52 – What drove people to buy or sell a mutual fund in those early days 5:33 – How did Tom's sell signal just before Black Monday impact the business 6:21 – What were the right funds to invest with 6:56 – What were the key trends during the 80's and 90's 8:25 – Layers of cost for mutual funds in the early days 9:04 – Average active management fee back then 10:56 – Evolution of ETF's 13:49 – Some numbers on the ETF landscape today 15:40 - Why did the last downturn foster more growth in ETFs 18:08 – The institutional presence in the ETF market 18:55 – Fees in the ETF space 19:50 – Distribution of ETFs 21:29 – Actively managed ETF's 23:35 – Tax efficiency of ETF's 26:42 – Judging ETF managers 31:26 – Do levered ETFs add any value 34:00 – Ted paper against levered ETFs 35:18 – Potential landmines in ETFs 38:49 – Risks in the ETF space today 42:11– How do ETFs impact pricing distortions 46:16 – What's happening in active fixed income ETFs 47:43 – Will fund flows chase hot managers? 48:35 – The big trends on the horizon 49:52 – What happens with liquid alternatives 51:08– What are businesses have thrived in the ETF space 53:56 – A deep dive into Tom's business ETF Trends 55:41 – Closing questions

Tali Sharot is a leading expert on human decision-making, optimism and emotion. A neuroscientist by trade, Tali combines research in psychology, behavioral economics and neuroscience to reveal the forces that shape our decisions, beliefs and inaccurate expectations of the future. She is currently a visiting professor at MIT, and is also an associate professor of Cognitive Neuroscience at University College London where she directs the Affective Brain Lab. Tali is the author of The Influential Mind, The Science of Optimism, and The Optimism Bias. Our conversation tackles many of the issues Tali has studied in her career, including the optimism bias, sense of control, confirmation bias, behavioral change, and overconfidence. We then touch on some of the applications of her work to investing, including the home country bias, making non-economic financial decisions, active management, emotion-driven decisions, team-based decisions, and research heuristics. Lastly, we learn a few parenting tricks from the Influential Mind. This conversation took place behind closed doors at the Context Leadership Summit in Las Vegas. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 3:18 – Tali's educational path to becoming a cognitive neuroscientist 4:58 – Why people make mistakes, optimism bias 7:24 – Does optimism bias impact our view of others as strongly as ourselves 9:12 – What should we do about our optimism bias 12:37 – How does controlling your environment impact how your brain works 14:47 – How do we work around our problems in decision making? 17:40 – How do you get more people to conform to things that are beneficial 21:11 – The impact of different personality types on these tactics 22:05 – How do we use this information to impact financial decisions 23:53 - Home country bias among investors 25:00 – Is home country familiarity a bad thing? 27:12 – Impact of well-being on investment decisions 28:20 – Picking stocks because of the illusion of control 29:52 – The role of emotion in driving our decisions 32:39 – How do you use this information to help individuals or teams make better decisions 36:23 – New research 40:41 – Raising kids 42:29 – Closing questions

John Pfeffer is an entrepreneur, investor and author of "An (Institutional) Investor's Take on Cryptoassets." He is currently Partner of Pfeffer Capital. In the 2000s, John was a Member at private equity firm KKR, and in the 1990s, he was Chairman of the Executive Board of leading French IT company Groupe Allium S.A. Before that, he advised on turnarounds while with McKinsey in Europe and Latin America. Our conversation jumps in the thought process and structure behind John's family office portfolio, which combines building new businesses alongside fund investments in public equity, private equity and venture capital. We touch on common issues like active vs. passive, access and fees, but from a very different insider's perspective. We then turn to his work in the crypto world and discuss his framework for incorporating crypto investing in a portfolio, conducting research in the space, defining the proposition for store of value and utility protocols, and valuing tokens and coins. John was the first investor I've come across that has both done a deep dive into the crypto world and is neither all-in nor all-out. He connects markets and economics with the complex ecosystem just simply enough that a layman like me can follow along. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 2:38 – How John thinks about managing his own capital 2:51 – Process to find a business to build 5:08 – Sizing of thematic deals 5:50 – New project copying a European retail model 7:18 – Core of the portfolio 9:02 – Biases of investment alternatives 11:18 – How will tax changes impact the private equity business 11:49 – What does he know about GP's as an insider that other LP's might not know 13:53 – How do they tackle venture capital investing 16:25 – Fees 17:40 – First involvement in looking at cryptocurrencies 17:46 – Institutional Investors Take on Crypto Assets 19:40 – Where do crypto assets fit in the structure of the portfolio 21:20 – Holding period for an asymmetric option 22:07 – What else did he do in cryptoassets after that first investment 24:54 – Store of value and utility protocols 29:51 – Valuing crypto assets 31:51 – Velocity of crypto exchange 40:12 – Gold replacement value of bitcoin 45:21 – Closing questions

Ross Israel is the Head of Global Infrastructure Investments for QIC, Queensland, Australia's 82B AUZ ($62B USD) investment fund. The Queensland government formed QIC in 1991 to oversee its Superannuation Fund, and the business has since evolved into a Global Diversified Alternative Asset Manager. Ross joined QIC in 2006 to create the Global Infrastructure effort and also serves as a member of QIC's Executive Committee. He has a quarter century's worth of experience in corporate finance and infrastructure funds management. Our conversation covers QIC's structure, examples of long duration assets in ports and waterways, crossing knowledge between private and public markets, managing external assets alongside a substantial internal pool, governance structure, compensation and incentives, navigating stakeholders, and opportunities and risks in the space. The subtle differences in constituents and objectives of sovereign wealth funds from other institutional pools come out in the implementation of QIC's investing. It's a topic we'll continue to explore on future shows. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 3:10 – A look at Ross's background 5:58 – QIC and how is it structured 7:32 – Portfolio composition when Ross arrived 9:08 – What was his strategy for putting money to work 10:03 – What was the thinking behind such a concentrated portfolio 11:28 – Port of Brisbane 15:38 – Local vs. global focus 16:58 – Most challenging deal he's done 18:28 – Lessons learned from their investing strategies 20:01 – Structure of their investment decision meetings 22:43 – Why does QIC take on outside capital? 25:27 – How does being part of a government entity play out in the deal dynamics 27:43 – How does decision making work on the fund? 29:06 – What happens if an internally run fund falters? 30:40 – QIC's approach to incentives and compensation 37:13 – What influence do the large pool of funds have on the way they pursue investments 39:06 – How do they think about their objectives 41:30 – What is the competitive landscape for infrastructure investments 44:38 – What are the concerns as they look out on the horizon 47:32 – How do they view public debt 48:54 – Closing Questions

Kim Lew is the Vice President and CIO of Carnegie Corporation, where she is responsible for the investment and oversight of the Corporation's $3.5 billion Foundation. Kim joined Carnegie in 2007 after spending a dozen years at the Ford Foundation. She is also a Trustee of Ariel Investments, the Board Chair of the Stevens Cooperative Schools, and a member of the investment committees of the Girl Scouts of America and the ACLU, and the steering committee of the Private Equity Women Investor Network. Last year, Institutional Investor awarded her Endowment & Foundation CIO of the year. Our conversation covers the American dream story of Kim's parents, Kim's path to picking technology stocks and venture capital managers at Ford Foundation, two very different models of successful Foundation investing, blow-by-blow of the creation of an atypical Co-CIO seat at Carnegie, responsibilities that CIOs hate, idiosyncratic investments, committee meetings that foster long-term thinking, evolution of a farm team of managers, risk-taking in investing and life, and what to do when you turn 50 years old. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 1:52 – A look at Kim's background 4:03 – How did her family life impact her schooling 5:26 – Was there anything in her upbringing that drew her to business 6:18 – First job out of college 7:15 – Heading to Harvard Business School 8:42 – The move to Prudential 9:48 – Her time at Ford Foundation 17:35 – Move to venture funds at Ford 18:20 – Comparing the job of sourcing managers then to today 20:27 – Kim's move to Carnegie 22:42 – How the investment thinking was different at Carnegie 26:32 – How did their thinking on investing play out in individual decisions 27:55 – The decision to have Co-CIO's 34:22 – Worst parts of being a CIO 37:13 – An outside responsibility that has been helpful to Kim's career 38:56 – How the thinking on an investment committee for a pension can be different 40:05 – Stepping into the sole CIO role 41:06 – Imparting your influence on investment decisions when you are less in the weeds 41:42 – Carnegie's investment strategy 46:38 – Implementation 56:59 – Taking risks vs being smart with your capital 1:01:36 – 50 things she had never done before 1:05:42 – Closing questions

Paul Black is Co-CEO and portfolio manager at WCM Investment Management, a $26 billion manager of global equities that he joined when it was a $200 million boutique in 1989. With so much of the institutional world, including my own training, focused on value investing, I was pleasantly surprised to learn about a large, high performing growth stock manager located in a non-descript building in Laguna Beach, California. Our conversation starts with Paul's trial-by-fire entry into the business and turns to growth stock investing, including defining a great growth company, searching for widening moats, assessing a culture tied to competitive advantage, creating a positive culture, learning from mistakes, identifying tailwinds, and protecting the downside. Paul embodies the principals he preaches and offers some tasty food for thought. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 2:54 – How Paul got started in the business 4:52 – Lessons learned in the early years of his career 5:56 – Common Stocks and Uncommon Profits and Other Writings 6:01 – Margin of Safety: Risk-Averse Value Investing Strategies for the Thoughtful Investor 6:05 – The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel 7:49 – What works about growth stock investing 9:01 – What constitutes a great growth company 13:47 – Defining and measuring a company's competitive advantage 17:50 – How does he assess a company's culture 19:41 – The Culture Cycle: How to Shape the Unseen Force that Transforms Performance 20:26 – Questions that help assess company culture 21:57 – Any data to back up claims that companies with good cultures perform better over time 22:46 – Culture aligning with competitive advantage 24:30 – Looking at WCM's moat and culture 31:23 – The landscape for active management 33:53 – Weathering tough periods for the firm 37:02 – How do they think about culture in other countries 39:01 – Why does growth stock investing work when the data shows otherwise 40:47 – What is he excited about in growth stocks 43:45 – Tailwinds at the sector level 45:10 – Downside protection in the portfolio 46:38 – Patterns of positive and negative allocator behavior 48:35 – How do they manage the change in the portfolio going from 200 million to 26 billion 49:53 – Closing questions

Jim Williams is the Vice President, Chief Investment Officer, and Treasurer of the Getty Trust, where he oversees a $7 billion portfolio for the Getty Museum. Before joining the Getty in 2002, Jim spent three years as the President of Harbor Capital Advisors and prior to that, was manager of the Ford Motor Company pension department. Our rich conversation covers all aspects of managing a significant pool of non-profit assets including modeling liquidity, creating a specialist team structure, sourcing managers, discerning between talented managers, co-investing, sizing manager positions, investing in venture capital, viewing hedge funds like a basketball point guard, working with a constructive board, and finding opportunities in the current "least dirty shirt" market. This conversation ranks way up there in the breadth, depth, and quality of discussion. I hope you enjoy listening as much as I enjoyed speaking to Jim. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 2:40 – A look at Jim's background and how he got to the Getty Museum 8:23 – A look at the pool of capital at Getty 9:47 – How does the high dependence of the endowment on the institution impact asset allocation 12:17 - How do they think about liquidity 14:29 – What happens when they find a priceless work of art to acquire 17:52 – What beliefs did Jim bring to the table in shaping how Getty allocated capital 22:46 – How does Jim think about asset allocation vs manager selection 24:17 – Their approach to China 24:55 – Finding good managers in China 27:29 – What are underlying factors when choosing between two similar managers 30:34 – What are some ways Jim determines if people have the "stuff" to manage capital 34:23 – Deep dive into the co-investment program 36:07 – How do they underwrite co-investments in a short period of time 37:53 – Why do they pass on co-investment opportunities 40:58 – How does Jim size investments 42:24 – Number of manager relationships across the portfolio 44:14 – Thinking about the level of diversification their strategy creates 48:35 – Jim's take on public equities and hedge funds 51:15 – Exploring the working relationship with the board and trustees 53:19 – Why do endowment and foundation trustees seem to have more success than other groups of trustees 54:24 – How does Jim exercise his decision-making authority 56:06 – Example of when Jim pushed back on an idea from a senior member of the team 1:00:47 – How have they found and retained team members 1:03:35 – Other competitive advantages that Jim brings to the table 1:05:20 – What is Jim most excited about and most worried about in the markets/his portfolio 1:09:28 – Closing questions

Michael Cembalest is the Chairman of Market and Investment Strategy for J.P. Morgan Asset & Wealth Management, a global industry leader with $2 trillion of client assets under management. Michael is also a member of the Investment Committee for J.P. Morgan Asset & Wealth Management and the Investment Committee for the J.P. Morgan Retirement Plan that covers the firm's 250,000 employees. Before taking on his current seat in 2012, he spent eight years as Chief Investment Officer of J.P. Morgan's powerhouse Global Private Bank. Prior to his work on the buy side, Michael worked on the sell side at J.P. Morgan Securities as head strategist for Emerging Markets Fixed Income. He started his thirty-year tenure at the firm as a member of the Corporate Finance division. Our wide-ranging conversation begins with Michael's early career that included watching a financial crisis unfold in the late '80s and side-stepping another in the late '90s, and turns to his role as CIO of a large, global private bank. We discuss differences in asset allocation and implementation between private clients and institutions and along the way come across his evaluation of Bernie Madoff, the creation of his strategy piece - Eye on the Market, the chart that everyone hates, the impact of politics, government debt, and energy on the markets, and views about active management. Lastly, you won't want to miss an amazing story Michael tells in answer to a new closing question. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 3:14 – Michael's start at J.P. Morgan 4:12 - The creation of the first Brady Bond 6:14 – How did starting his career during a crisis impact his views on the world 8:10 – Early career roles 10:07 – Transition to the buy side 16:30 – Differences in managing money for a public company from managing money as an independent asset manager 17:25 – Transition to CIO 18:30 – First steps in changing the private bank investment structure from a closed model 22:21 – Overseeing a diverse group of clients 29:15 – How does he stay informed about everything impacting the markets 27:54 – Assessing Bernie Madoff 28:19 – Hedge funds and the tax difference they provide 30:28 – Differences in how Michael views various asset classes between taxable and tax-exempt pools 31:40 – Shift to strategy work and writing 34:09 – How does Michael describe Eye on the Market 35:20 – Domestic politics and geopolitical impact on the markets 38:52 - Looking at the high corporate profit landscape against the enormous debts of governments, nationally and locally 42:31 - Any way out of the debt problems we are seeing at state and local government level 47:31 – Entitlement spending in other countries 48:33 – Research on energy and consumption 51:44 – Use of technology to distribute his research 53:43 – Thoughts on active management 56:30 – Closing questions

One common refrain across my conversations has been the importance and subtleties of effective governance in making optimal investment decisions. Alongside Steven Galbraith's incredible career as an analyst, strategist, portfolio manager, and entrepreneur in the asset management business, he has served on as many Boards as anyone I know. I imagine many of you have heard Steve's story, but if not, you may want to have a listen to the very first episode of Capital Allocators before diving in here. Our conversation today starts with an update on Steve's personal investment in the Narragansett Beer Company and moves into a practical discussion inside the Board rooms of each of his current seats that range across a university, a large family office, a public company, a government agency, and two early stage fintech companies. We touch on time allocation, governance structure, Board composition, adding value, the politics of Boards, and the motivation of Board members. We also get an update on Steve's family office, that he's managing alongside his wife Lucy, a seasoned distressed debt investor, and we close with our brief, contrary outlook on the baseball season. Steve's perspective and insights on the real world of Boards is second to none, and this conversation is as full of gems as our first one. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 2:45 – Update on Narragansett Brewery 2:53 – How Passion Investors Helped Revive Narragansett Beer 4:28 – Narragansett in the White House 5:19 – With all of the boards that he serves on, how does he manage his time 7:34 – How much time do these boards assume Steven is investing in them 9:32 – Highest functioning board 11:46 – Maintaining stability between the board and investment team 16:29 – What Warren Buffet had to say about the Tufts endowment 17:45 – What are the board dynamics in a family office 22:22 – Overview of for-profit boards 26:12 – Is the familial relationships of board members another way an investment committee could construct a board 26:56– Could a university or foundation create a board like this with close familial ties amongst members 28:46 – Optimal board structure of a foundation 29:57 – Steve's time in government serving on a board 32:52 – Board of startups and early stage companies 35:02 – A look at Steve's family office 37:20 – What do the analytics of financial companies look like 5-10 years from now 38:35 – Looking at the quality of analytics he currently gets from his outsourced team compared to larger firms he has worked with 39:37 – What is Steve seeing in the markets 40:42 – What is the most interesting idea that's come across Steve's plate in the past year 44:32 – Politics of boards and what drives them 48:36 – Closing Questions

Chris Brockmeyer is the Director of Employee Bennefit Funds for the Broadway League, the national trade association for the Broadway theatre industry. Chris serves as an employer-appointed trustee, in most cases as Co-Chair, on eleven multi-employer pension funds, seven health funds and four annuity/401(k) funds with approximately $7 billion in assets. For 11 years, Chris has artfully navigated delicate relationships across unions and employers and was honored for his great work by Institutional Investor magazine with the 2014 award for Taft-Hartley Plan of the Year. Before arriving at the Broadway League in 2007, Chris worked on both sides of the table – first representing employees in eight years of work for performer's unions and then seven years representing employers as Director of Labor Relations at Live Nation/Clear Channel Entertainment. Our conversation dives into the tricky governance dynamics of Taft-Hartley boards, including their challenging regulatory structure, keeping the peace among constituents, setting investment objectives, strengths and weaknesses of a slow-moving decision-making body, best and worst in relationships with investment consultants, and OCIOs as a governance solution. Those struggling with governance challenges will take a step back and admire Chris' dexterity in working productively with an ostensibly untenable set of circumstances. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 2:08 – Chris's background and how that led him to a job on Broadway. 4:59 – Key skills that make Chris effective at his job 5:44 – Current role at the Broadway League 7:10 – What makes an effective board and a less effective board 10:25 - How do Chris and these various boards set out the investment objectives. 12:41 – What needs to change in Taft-Hartley plans 16:48 – The regulation of the Taft-Hartley Plan Boards 20:25 – Strengths and weaknesses of the consulting relationships 24:20 – How do discussions about increasing benefits translate into investment risk 27:17 – How wide is the range of asset allocation across all of the plans 29:05 – How do you explain expected rate of return assumptions in the current environment 31:15 – What are the strengths that Chris has seen in successful investment consultants 32:40 – Chris's core investing beliefs and how much he can influence these boards with them 35:31 – Are there places where the governance of Taft-Hartley plans could be improved 39:31 – Switching to OCIOs 41:32 – Would they ever go back to a regular consultant from an OCIO 42:59 – Other areas that have similar governance struggles 45:06 – What happens when Chris comes up with an investment idea 46:30 – Any concern that Chris's team is working with only average OCIO's or consultants as they look to scale up and attract larger funds 48:59 – Closing Questions

Andy Redleaf is the Founding Partner of Whitebox Advisors, a $5.5 billion multi-strategy hedge fund launched in 1999 with primary offices in the metropolitan hubs of Minneapolis, Austin, and Sydney, Australia. Before founding Whitebox, Andy spent twenty years trading options, for two years at Gruntal & Comes mpany alongside Stevie Cohen, fourteen on the CBOE, and five as a Founding Partner at Deephaven Capital Management. He has an irrepressibly creative mind and, alongside his partners, writes one of my favorite manager letters. Our conversation covers Andy's nuanced view of the evolution of trading markets and financial instruments over his forty-year career, including arbitrage trading in the 1970s and 80s, unintended consequences of the deregulation of trading commissions, segmentation of market participants, importance of liability management, growth of orphaned securities, and the pending shift from decentralized to centralized market systems over the coming years. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 1:52 – Andy's background and the founding of Whitebox 5:34 – The math of options in the late 70's, early 80s 13:44 - The decentralization of markets 16:34 - Andy's transition into trading other strategies 18:31 – The launch of Whitebox 20:08 – The meaning of the firm name Whitebox 23:38 – An example of a transitioning security from one group of investors to another 28:31 – Has it gotten harder to find arbitrage opportunities 32:29 – The driver of the financial crisis 32:44 – Gary Gorton, Misunderstanding Financial Crises: Why Don't We See Them Coming 34:28 – His purchase of a bank 38:17 – How he got involved in the structured credit markets 42:39 – What is that Whitebox does differently from others 47:14 – Principles that guide the investment activities he likes to take part in 50:03 – How will the financial system evolve over the next 10 years 55:29 – Closing questions

Last fall, I sat down with a fellow former hedge fund of funds professional Khe Hy, who left the business a few years ago and has developed a fascinating media platform around introspection, self-awareness, and self-development. Certainly a set of characteristics we don't normally associate with folks in the asset management business. Khe interviewed me about my career path and some lessons I've learned about people, business, and life. With his permission, I am sharing the conversation to allow you to learn more about the perspective that I bring to the conversations on Capital Allocators. If you like the subject matter, I'd encourage you to check out Khe's podcast, entitled Rad Awakenings, available on iTunes or his website, radreads.co. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 1:53 – Ted's time with Dave Swensen 2:40 – How did Ted get the job not knowing about stocks 3:56 – The start of Ted's time at Protégé 5:27 – How did Ted view the world as someone picking managers vs someone picking stocks 9:01 – Early days at Protégé 10:36 – Attributes that Ted tried to unpack about individuals 13:18 – Understanding a team's intrinsic vs extrinsic motivations 15:03 – How much of investing is about true skill vs being on the right side of a market trend 17:06 – What did Ted learn about greed during the bull market run of the early 2000's 20:00 – The ego, envy and entitlement of financial professionals 22:36 – The potential to hit a high-water mark and never feeling satisfied 28:20 – Loving what you do despite the financial windfall 32:50 – Would Ted have the same passion for the markets if he hit the proverbial lottery 34:36 – The feeling of financial survival and what would happen if Ted didn't have it 37:24 – Citizen Schools 38:41 – How to stop caring about other people's perception of you 40:46 – Most underrated attribute of Ted that he has discovered in his reinvention 41:53 – Times Ted's resilience was tested 43:08 – Ted on Invest Like the Best Podcast 43:10 – Hero's Journey Foundation 45:02 – What does higher education and first jobs look like for the next generation given the digital changes in society 49:20 – Do millennials have less upward mobility then past generations 49:43 – The Premium Mediocre Life of Maya Millennial 52:09 – Follow and learn more about Ted at capitalallocatorspodcast.com 57:41 – Closing questions with special guest interviewers

Wayne Wicker is the Senior VP and CIO of ICMA Retirement Corporation, an asset manager that oversees $50B across more than a million retirement accounts of City and County public sector employees throughout the country. Before joining ICMA-RC in 2004, Wayne had a distinguished career as an allocator and manager, starting as an allocator at the corporate pension fund of Dayton Hudson (now Target Corporation) in the 1980s and the Howard Hughes Medical Institute endowment in the mid-1990s, after which he moved to direct investing in large cap growth equities for seven years at Cadence Capital Management in 1998. Our conversation covers Wayne's career path, multi-asset investing, and the ins and outs of managing defined contribution plans as a fiduciary and as a business. We discuss asset allocation strategies, regulatory limitations, stable value products, retirement shortfall risks, active vs. passive on large pools of capital, and managing internal and external teams. This episode took place at a recent Institutional Investor conference for Corporate Funds and Insurance Portfolios, with the core discussion about ICMA-RC occurring in front of a live audience. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 2:01 – How Wayne first got into the investment business 3:58 – What he did after getting his MBA 7:25 – How he learned about the pension business as a staff of one 9:18 – Key investment lessons from his early career 11:08 – Decision to move on from Target/Dayton Hudson 12:44 – Key differences between overseeing a corporate pension vs a hospital endowment structure 14:25 – How much did the difference in the investing strategy come from the mission of the funds vs the boards overseeing them 15:50 – What could Wayne do on the margin at Howard Hughes 17:28 – Transition to CIO 22:40 – Live Show Begins 23:00 – Defining ICMA-RC 23:32 – How does Wayne think about setting investment objectives with such a diverse group of clients 25:02 – Is it frustrating to have a more finite universe of investing options compared to previous work at Howard Hughes and Dayton Hudson 26:08 – Views on active vs passive 27:50 – The manager selection process 28:49 – Managing risks with external managers vs an internal team 30:34 – How does the team at ICMA-RC put their best ideas forward without governance getting in the way 31:34 – What constraints are imposed on investment decisions by the various regulatory bodies that ICMA-RC faces 32:40 – Their outlook on the market 34:08 – How does ICMA-RC's constituents respond to market performance 35:32 – Closer examination using 2008 stock performance 36:23 – How does Wayne educate investors 38:00 – Next steps for ICMA-RC 38:51 – Most challenging aspect of Wayne's work life 39:41 – Is there a looming pension crisis 40:53 – How do the Financial Planners help the employees if things don't work out 42:10 – How do they think about financial planning for clients when there's a chance defined benefit plans could come up short in the future 45:06 – How does Wayne address manager selection differently today given some of the constraints that he faces 47:19 – What has led Wayne to want to exit manager relationships 49:46 – Is there a point where Wayne would decide the optimal strategy is to go passive 51:28 – How does Wayne think about technology and the way it will be disrupt the industry 52:58 – Balancing the internal/external dynamic when hiring people 54:30 – Wayne's greatest success and failure over the last 14 years 55:50 – Where will the move into emerging markets come from 56:27 – What does Wayne think of the new products that can help younger constituents meet their retirement objectives 57:41 – Live Show Ends/Closing questions

Our exploration of the use of modern data analytics to enhance investment results continues this week with two of the leading providers of tools for portfolio managers. My guests on today's show are Clare Flynn Levy and Cameron Hight, both former investment managers who became entrepreneurs seeking to improve outcomes for other managers. Clare is the founder and CEO of Essentia Analytics, a behavioral data analytics service that enables fund managers to capture rich data about their own behavior and its context. Essentia analyzes trading history to help managers overcome common behavioral biases and optimize their trade entry and exit on positions. Cameron is the Founder and CEO of Alpha Theory, a fintech company that helps investment managers optimize their position sizing process. By creating a disciplined, real-time process based on a decision algorithm with roots in actuarial science, physics, and poker, Alpha Theory takes the guessing out of position sizing and allows managers to focus on what they do best - picking stocks. Our conversations cover the founding of their respective businesses, the mistakes portfolio managers commonly make, the tools they employ to help managers improve, and the challenges they face in broader adoption of these modern tools. The good news is the clients of Essentia and Alpha Theory have demonstrated improvement in their results after employing these techniques. If you ask Clare and Cameron, you may come a whole new appreciation about the potential for active management going forward. You can learn more about these two innovative companies at essentia-analytics.com and alphatheory.com. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes Clare (2:26) 2:29 – Clare's path to founding Essentia 5:42 – What makes data science of investing revolutionary in the past five years 6:25 – The pitch for Essentia's tools 7:57 – How do you use data to get into the behaviors that work and the ones that don't 8:06 – Michael Mauboussin podcast episode 8:10 – Annie Duke podcast episode 11:03 – Specific tenants of behavioral finance 12:39 – Parts of the portfolio process that they explore 14:20 – How do you actually convince people to change behavior 16:17 – The nudges built into the system 21:26 – How much data is needed to be able to help improve performance 22:16 – Most interesting data set that a portfolio manager has tried to get to improve their performance 24:21 – Is there consistency in people's patterns 27:08 - The hardest part of convincing someone to become a client 29:16 – What other places does Essentia plan on expanding 30:42 – Given all of the data that Clare has seen, what's her outlook on active management 32:39 - Closing questions for Clare Cameron (37:58) 38:02 – Cameron's background and the founding of Alpha Theory 38:35 – What problems does Alpha Theory looks to solve 38:49 – Psychology of Intelligence Analysis (Richard Shure) 40:13 – The mistakes he sees portfolio managers make 42:29 – What tool does Alpha theory is provide to portfolio managers 44:17 – What changes in the portfolio manager's implementation 47:27 – What have been the outcomes when people implement Alpha Theory 51:58 - Are there different firms or type of firms that are better at picking stocks 56:36 - The Concentration Manifesto 1:00:25 – How they calculate batting average of allocators 1:01:41 – Where else could this tool be applied 1:03:31 – What questions should allocators be asking of managers 1:05:09 – How much does the input of information impact the outcome 1:06:42 – What other research has Cameron been able to do based on this data 1:08:56 – Biggest challenge in running this business 1:11:23 – Closing questions for Cameron

Increased sophistication in manager assessment is an important trend in the search for alpha. My conversations with Michael Mauboussin and Annie Duke suggested frameworks to think about enhanced decision-making processes and prompted a deeper dive into the ways allocators and managers can improve their craft. This week and next explores some of the tools available to help make it happen. Basil Qunibi is the CEO of Novus Partners, a data analytics company whose mission is to help the world's top investors generate higher returns. As big data pervades commerce across industries, Novus is the most well-known provider of tools to analyze investment manager performance, allowing allocators to play Moneyball by breaking down the attributes of manager skill. Novus' 200 clients are split between allocators and hedge fund managers who collectively oversee approximately $3.5 trillion of assets. You can learn more about the company and its service at novus.com Our conversation starts with Basil's path to creating Novus and dives into the tools an allocator can use to improve their understanding of a manager's skill, including the data sets available to allocators, the levers a manager employs in driving returns, the relationship between data and a manager's process, a framework to analyze crowded names, and future horizons for data-driven assessments of managers. DONATE TO CYCLE FOR SURVIVAL, http://mskcc.convio.net/goto/ted. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes DONATE TO CYCLE FOR SURVIVAL, http://mskcc.convio.net/goto/ted. 2:46 – The founding of Novus 5:45 – What did the qualitative assessment of managers look like at first for Basil 6:50 – How did he start to quantify managers 09:47 – What he saw in the initial data 13:24 – The early days of Novus, going all the way back to the concept 14:05 – Direct from Dell: Strategies that Revolutionized an Industry 14:07 – Sam Walton: Made In America 16:27 – Novus' first product 19:13 – Core components of measuring the skill of a manager 19:54 – Exposure management 22:10 – Capital allocation 23:27 – Idea selection 24:10 – Position sizing 25:11 – Tactical trading 25:45 – How should this data be used 28:08 – Why this data is useful for capital allocators 30:48 – How efficient is the market for talent 31:54 – What has happened to stocks that are crowded compared to those that aren't 35:15 – How does Novus use conviction in their metrics 36:43 – Consensus and concentration 40:02 – How Novus went from servicing allocators to also helping managers themselves 42:22 – Overview of Novus' clients and what they've been able to learn from all of this data 46:45 – What other markets could Novus be applicable to 48:56 – Most creative application of this data by a client 49:53 – Closing questions

Rick Selvala is the co-founder and CEO of Harvest Volatility, a ten-year old manager of a variety of volatility strategies that oversees $13 billion in assets. After starting his career in the Treasury department at General Motors in the mid 1980s, Rick has spent nearly three decades trading derivatives on the sell side and buy side. Rick has an uncanny ability to break down this complicated investment area and make it sound simple. Our conversation discusses the world of volatility, including intelligent uses of derivatives, overcoming headline risk, characteristics of successful traders, assessment of alpha, the current volatility environment, and strategies that capture returns. His insights left me thinking twice about some of the assumptions my System 1 brain had formed about volatility. Time for System 2 to go to work. DONATE TO CYCLE FOR SURVIVAL, http://mskcc.convio.net/goto/ted. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes DONATE TO CYCLE FOR SURVIVAL, http://mskcc.convio.net/goto/ted. 3:03 – Rick's path to Harvest 5:17 – How should one think about volatility as an asset class 7:56 – Volatility as a path to enhance yield 11:07 – Is there a programmatic way to implement 12:55 – Volatility as a path for insurance 15:45 – Where do people go wrong with leverage 18:28 – What level of understanding of this space do clients really have 21:58 – How would someone express the idea that volatility is cheap in the market 22:04 – Bill Spitz podcast episode 24:24 – What strategies could managers take advantage of in a low volatility environment 26:01 – How does Rick asses if someone is a good trader 27:32 – How do you identify firms that are too bold 29:26 – Does the community have a good sense of whether traders are acting responsibly 30:08 – How do you determine if a manager is outperforming 32:11 – Is there a structural return from selling insurance to the market 34:13 – Have computer systems changed trading in the derivatives market 35:14 – Taking a look at the current environment 38:43 – Recent market turmoil 39:58 – Are quants impacting market volatility 41:26 – What's next on the frontier for Harvest 45:02 – Closing questions

Ali Hamed is the co-founder of CoVenture and Managing Partner of the CoVenture VC Fund. CoVenture is an innovative company that identifies and invests in novel assets formed by the intersection of technology and finance. The firm manages an early stage venture capital fund, direct lending fund, and crypto asset index fund, with each taking a creative twist on its market. Our conversation starts with Ali's entrepreneurial path to the creation of CoVenture, and covers examples of previously unpriced investment opportunities, including produce receivables, employee payroll loans, AirBnB accounts, and loans against employee stock options. We walk through the world of crypto assets and the state of the venture capital industry. Ali's fresh lens on the world offers a fascinating perspective on every aspect of early stage investing. If I didn't say it in advance, you'll be astounded to hear that Ali is only 26 years old. He's one to watch for the long-term. Learn More Join Ted's mailing list at CapitalAllocatorsPodcast.com Write a review on iTunes Follow Ted on twitter at @tseides For more episodes go to CapitalAllocatorsPodcast.com/Podcast Show Notes 2:22 – Ali's background 3:09 – How Ali got the bug for startups 4:06 – His time in NY without a home and where he gained the confidence to start in the entrepreneurial space 7:35 – Why their venture business is different from so many others in the space 9:12 – How Ali turned an idea into a business 11:33 – How does Ali describe CoVenture 12:10 – An example of an ideal CoVenture investment 14:53 – The transition into a specialty lending business 19:25 – How many niche opportunities has Ali identified as a place where he could create loans 22:04 – Examples of unpriced assets 24:23 – How does Ali find unique opportunities 27:40 – What's next on the horizon for Ali and CoVenture 28:28 – Looking at cryptocurrency and the business that Ali has built for the space 29:33 – Why did they create a cryptoasset index that was cap weighted 30:39 – Why should someone have exposure to a cryptoasset 35:23 – How does someone in the financial world get comfortable with the idea of cryptoassets 38:59 – Why Ali doesn't invest in ICO's 40:42 – What would an institutional cryptoasset fund look like 45:50 – How should an allocator try to address the idea of first in money in the cryptospace 50:32 – Where can someone play in the spectrum of venture investing 52:30 – What is the time horizon for venture investments 56:24 – Closing questions

Annie Duke is a renown public speaker and decision strategist. For two decades, she was one of the top poker players in the world, including winning a World Series of Poker bracelet and the $2 million winner-take-all WSOP Tournament of Champions. Her study of the science of smart decision-making began with a National Science Foundation Fellowship, which she used study Cognitive Psychology at the University of Pennsylvania. Among her charity work and television appearances, Annie was a runner-up to Joan Rivers on Celebrity Apprentice, during which she raised $700,000 for Refugees International. She is a natural teacher and storyteller with an active mind that constantly searches for accurate truth. I highly recommend Annie's new book, Thinking in Bets, which comes out this week. In her life after poker, she is a featured speaker, writes a newsletter and a blog, and advises companies on improving their decision-making process. Have a look at her website, annieduke.com, for more information. Our conversation discusses Annie's path from an Ivy League education to professional poker, the nature of a bet, how we form beliefs, why we make bad decisions, and what we can do to improve our decision-making process. Towards the end, we also talk about bankroll management, poker faces, and advice she would give the President on how to make better decisions. For more episodes go to CapitalAllocatorsPodcast.com/Podcast Write a review on iTunes Follow Ted on twitter at @tseides Join Ted's mailing list at CapitalAllocatorsPodcast.com Show Notes 2:30 – Annie's path through the poker world 6:05 – Her transition into teaching and the lesson of tilt 11:57 – How do you apply the concepts of betting and gambling broadly to decision making 13:35 – What is it about the science of the brain that prevents us from making good decisions 14:17 – Stumbling on Happiness 14:19 – Dan Gilbert Ted Talk 15:44 – Kluge: The Haphazard Evolution of the Human Mind 18:50 – Motivated reasoning 21:10 – Is there anything we can do to fix our decision-making biases (wanna bet) 28:05 – Other devices to improve our decision-making 32:29 – Value of a decision group 33:16 – Superforecasting: The Art and Science of Prediction 34:00 – Mertonian Norms, CUDOS 40:27 – Mental time travel (Marty McFly from Back to the Future) 42:55 – Jerry Seinfeld – Night Guy vs Morning Guy 44:55 – Applying these tools and the parallels between poker and investing 48:59 – Reading poker faces 49:21 – Joe Navarro books 49:34 – Joe Navarro Psychology Today 52:50 – What advice would Annie give President Trump in terms of improving his decision-making process 53:52 – Favorite sports moment 55:45 – What teaching from Annie's parents has most stayed with her 56:08 – What information does Annie read that a lot of people might not know about that is valuable 56:18 – The Greatest Show on Earth: The Evidence for Evolution 56:19 – Why Evolution Is True 56:58 – What life lesson does Annie wish she knew earlier in life 58:28 – Looking ahead, what advice would Annie give herself today from a ripe old age

Seth Masters recently retired from Alliance Bernstein, where he spent 26 years across six different careers. He started as an analyst in emerging market equities and over the last decade and a half served separately as the Chief Investment Officer of Blend Strategies, Asset Allocation, Defined Contribution Strategies, and the Private Wealth Business. Seth is true polymath – articulate, thoughtful and wise on a wide range of topics. Our conversation starts with a fascinating discussion of China 30 years ago and today and later covers contrarian career paths, the critical flaw of benchmark-based investing, structural issues with Investment Committees, potential causes of the next crisis, and his most recent project - angel investing in fintech. For more episodes, go to capitalallocatorspodcast.com/podcast Follow Ted on twitter at @tseides

Bill Spitz was the longtime head of Vanderbilt University's endowment before retiring, for the first time, in 2007. He has received numerous lifetime achievement awards for his work and is one of the legends in the business. After failing in his retirement, he joined Diversified Trust Company, a wealth manager with $6.5 billion in assets under management that he co-founded back in 1994. Our conversation discusses managing an endowment in the early years, implementing unconventional investments, creating an edge as an allocator, selecting managers and conducting due diligence, exiting managers, challenging current landscape, and working with families. For more episodes, go to capitalallocatorspodcast.com/podcast Follow Ted on twitter at @tseides Show Notes 1:21 - (INTERVIEW STARTS) 1:30 – Early days at Vanderbilt and the landscape for university investment offices 3:17 – Career before working at Vanderbilt 3:59 – Transition from Wall Street to going back to his alma mater 4:48 – Pioneering Portfolio Management: An Unconventional Approach to Institutional Investment 5:23 – Out of the box ideas when he first got started 6:25 – Convincing the board to approve unconventional ideas 8:28 – Why Bill retired 9:28 – Diversified Trust White Papers 9:31 – What is the edge that allocators have when it comes to investing 9:33 – Paul Johnson and Paul Sonkin podcast episode 9:35 – Pitch the Perfect Investment: The Essential Guide to Winning on Wall Street 10:05 – Gaining an Edge in Investing 12:30 – Where can skill from an allocator perspective be applied 14:32 – Judging the skill of managers as an allocator 15:16 – Looking out to the future, how will the endowment model stack up against the traditional 60/40 portfolio 17: 47 - How do you manage clients when your strategy may not be keeping up with the S&P 500 in the short term 19:15 – Thoughts on bitcoin 20:00 – How Bill was able to get involved with Diversified Trust while working at Vanderbilt 21:47 – Differences in managing endowments vs taxable pools of capital 23:22 – Stories that either derail an investment process or educate someone to stay the course 24:23 – Manager selection process and what Bill looks for when choosing the right one 28:01 – Bill's view on exiting managers 29:55 – How do you measure the evolution of a manager's investing strategy, especially as the market changes 31:41 – What is different today about investing vs when Bill first started 33:56 – Do alternative and emerging investment streams deliver the returns that many hope for 35:13 – Why don't endowments, foundations, or pension funds feel comfortable with moving chunks of their portfolio to cash 37:00 – How does Bill think about the balance of investments with higher return potentials against their higher costs 38:13 – Any categories that really pique Bill's interest 39:22 – What does the asset management industry look like in 10-20 years from now 41:56 – What should aspiring money managers think about as they move forward in this business 43:09 – What Bill is most proud of in his career 43:54 – Favorite sports moment 45:01 – What teaching from Bill's parents has most stayed with him 45:14 – Battle Hymn of the Tiger Mother 45:18 – The Triple Package: How Three Unlikely Traits Explain the Rise and Fall of Cultural Groups in America 46:10 – What information does Bill read that he gets a lot out of 46:20 – The Economist 46:33 – Wall Street Journal 46:34 – Bloomberg 46:45 – Life lesson that he wished he knew a lot earlier 47:29 – In his waning days, what advice would Bill give himself today

Michael Mauboussin currently is the Director of Research at BlueMountain Capital, a multi-billion dollar hedge fund and asset manager. He spent the majority of his professional career thinking and writing about decision making, behavior and complex systems, with long stints at Credit Suisse and nearly a decade alongside Bill Miller at Legg Mason. Michael has been an Adjust Professor at Columbia Business School for 24 years. Our conversation covers Michael's early career, the paradox of skill, academic research more favorable to active management, decision-making, optimal size and composition of teams, unsettling features in the market, data analysis in sports, career risk, the Santa Fe Institute, and Michael's new research on the horizon. Every time I speak to Michael I come away thinking better and feeling smarter, and this time was no exception. For more episodes go to CapitalAllocatorsPodcast.com/Podcast Write a review on iTunes Follow Ted on twitter at @tseides Join Ted's mailing list at CapitalAllocatorsPodcast.com Show Notes 1:48 - What was Michael like as a kid 2:26 – How Michael found his way to Wall Street 6:18 – His start as an analyst in consumer and packaged goods 7:52 – Why there are no .400 hitters in active management and the paradox of skill 8:15 – Full House: The Spread of Excellence from Plato to Darwin 14:26 – Why have there been massive flows into index funds over the last 3-4 years 15:44 – Academic research supporting active management 16:09 – Mutual Fund Flows and Performance in Rational Markets 16:25 - On the Impossibility of Informationally Efficient Markets 22:52 - Indexing and Active Fund Management: International Evidence 23:12 – Do these trends also apply in global markets 24:01 - The Mutual Fund Industry Worldwide: Explicit and Closet Indexing, Fees, and Performance 25:22 – What has Michael discovered in his new role at Blue Mountain through his new credit lens 27:49 – Amazon, the world's most remarkable firm, is just getting started 30:02 – What are some of the lenses that Michael uses when dealing with allocators 35:02 – How does Michael go about interviewing for a team while taking into account their biases 36:19 – The Rationality Quotient: Toward a Test of Rational Thinking 36:37 – Biggest risks in the markets today 37:31 – Banks to Funds: Have Some Leverage With That Deal 39:45 – Liquidity in the markets 41:26 – What's most interesting to Michael about the merging of data and sports 41:34 – The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing 43:42 – Big Data Baseball: Math, Miracles, and the End of a 20-Year Losing Streak 44:32 – Scorecasting: The Hidden Influences Behind How Sports Are Played and Games Are Won 45:57 – Psychological bias in sports 46:16 - Malcom Gladwell Podcast: The Big Man Can't Shoot 47:23 – Psychological bias in investment management 47:40 – Scott Malpass on Capital Allocators 48:44 – Michael's work with the Santa Fe institute 53:08 – Scale: The Universal Laws of Growth, Innovation, Sustainability, and the Pace of Life in Organisms, Cities, Economies, and Companies 54:40 – Next big piece of research Michael is working on 57:53 – The End of Theory: Financial Crises, the Failure of Economics, and the Sweep of Human Interaction 57:59 – Should Michael be using his skills elsewhere in the context of a world where so many advocate for just indexing 1:01:36 – Charley Ellis on Capital Allocators 1:02:31 – CLOSING QUESTIONS

Margaret Chen is the Head of CA Capital Management, Cambridge Associates' $20 billion Outsourced Chief Investment Officer (OCIO) business. She has spent twenty years at Cambridge Associates, which was her first and only stop in the investment business after getting started in the working world as a management consultant at Coopers & Lybrand Consulting. Our conversation covers Margaret's career path, her evolution from a consultant to a principal, the value proposition of an OCIO, measuring performance, and the tension between being the same and being different for clients. Margaret has the ear of almost everyone in our field, and brings incredible perspective to addressing the key issues allocators face. For more episodes, go to capitalallocatorspodcast.com/podcast Follow Ted on twitter at @tseides

I've received several emails over the last bunch of months asking for my take on the investing world and the topics we cover on the show. Fortunately, I've had a chance to appear as a guest on a few other podcasts, and thought I would share some of those conversations from time to time. About a year and a half ago, Patrick O'Shaughnessy interviewed me to discuss the book I wrote on his amazing podcast, Invest Like the Best. The discussion quickly turned to a deep dive on hedge funds - past, present and future. We subsequently recorded two other conversations. For the first, I asked him to interview me about the Buffett Bet. You can find that conversation on Episode 5. In the second, Patrick interviewed me alongside our friend and star micro private equity investor, Brent Beshore. You can find that entertaining conversation at Invest Like the Best, Episode 30. For more episodes, go to capitalallocatorspodcast.com/podcast Follow Ted on twitter at @tseides

Chris Acito is the CEO and CIO of Gapstow Capital Partners, a credit-focused investment organization. Chris started his career as a management consultant and traversed to focus on asset management consulting around the founding of Casey, Quirk, and Acito. He switched to the buy side focusing on hedge funds in the years leading up to the financial crisis and started Gapstow in 2009. Our wide-ranging conversation starts with Chris' background and moves to the formation of a credit focused firm in the thick of the financial crisis. We discuss the credit landscape today, shift from legacy to new issue opportunities, existential crisis in investment grade paper, liquidity, ETFs, credit as an asset class, credit-specific due diligence, and the next distressed cycle. For more episodes, go to capitalallocatorspodcast.com/podcast Follow Ted on twitter at @tseides