YouSaid · the spoken record

Jordi Visser

lines on the record: 116
first: 2021-11-08
most recent: 2021-11-08
sittings or episodes: 1
sources: podcast

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“Identify how good someone is. If you don't ask the question, you're just using numbers. And I think hearing people speak and how where they are of their portfolio gives you a lot more comfort”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“So part of what you want to find, and this is the collection of data, I want to see their reaction. I want to know if they were in control. They knew exactly what was happening. And basically what that comes down to is how aware were they? How aware were they of the portfolio and how aware were they of their kind of thought process in terms of their exit strategy and what they were thinking behaviorally? So when you learn that, no, we had one company that all of a sudden intraday that wasn't part of our portfolio had kind of at a conference spoke about something, that company got hit, a bunch of other companies that are very similar got hit at the same point. We weren't surprised by the company A at the conference that spoke. And so we're not as worried about the portfolio. In fact, what we ended up doing was we added to the positions. That gives me a really good data point of how the behavioral alpha of that person is, how emotional were they during there, how much did they know their space and know what was in them. That's kind of what you want.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“And we sit down and I use visuals. So I go through a Bloomberg presentation every day. I try to highlight the things that have changed recently and why I think these things may impact the risk reward. And so by doing that, that's kind of the way that I serve a purpose here at this point.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“We saw small cap outperform large cap right around April when the tariff started to go into place. Made sense. Okay, tariffs are going to place. Multinational companies, large cap companies will be more affected, domestic companies will be okay. The U.S. economy is fine. Global economy is bad. Then all of a sudden, we started worrying about growth. And around June, July, you started to see the large cap. Oh, we got to go buy large cap because the balance sheets are better. I'm worried about G. I'm worried about all this stuff. Whether I'm right or wrong, I'm generally, like I mentioned at the beginning with my father, I've been trained to try and find things that are high reward, low risk scenarios. So if I think those things, what I end up doing is we have a meeting every morning for 15 minutes. So I follow the 15 minutes is a good amount of time to keep people's attention.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“My job on the macro stuff, I think, is to help with the Bayesian side. So I'm trying to be like at a poker table walking around the poker table and helping the individual players, not by telling them what's in everyone's hands, but by highlighting, you know, you've got this on there. They just bet this way over there. Sure, this is a good risk reward at this point? So I'm not telling him what to do, but just to give you an idea, last year size was a volatile factor. So initially”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“So, when you see important macroinflection points that you think even today other investors may not have interpreted the same way that you did, does that filter into what you're doing in the portfolios when individual PMs or have these risk-constrained portfolios? And how does it if it does?”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“The next 10 years, but it's this relationship from a technology basis with the two technology powers on the planet, realizing that at some point you don't want other people making your technology. And that's a big change considering it was the driving investment force really for people to make money since 2007”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Just been better. There's less liquidity, so you're getting more of these one off shocks. And so I think for us, one of the reasons that we have been able to be consistent the last three years in a challenging environment has been that there's been more dispersion opportunities. I think that all started in August of 15. Two things coincided in that final quarter really four months of the year that I still don't think people have come to grips with. Number one, China devalued their currency in August of 15, which was a big deal. China's not an emerging market at that stage. They're one of the largest countries in the world. Second thing is quantitative tightening really began. So the Fed finally raised rates in December 15. And so if you take that period there, we're in quantitative tightening now. And China and the US are in a trade war and probably more importantly embarking on something which I think has historic implications or at least.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Let's assume because we're running a neutral portfolio, let's just use market neutral. Let's assume everyone is dollar neutral each day. And they have 35 longs, 35 shorts, and every single name at the end of the year is up 5%. So the only way they could have made money is if there was a lot of dispersion in between the ending. So it's a combination of the dispersion on some type of time period and the volatility in the marketplace. And that's what we do. Going back to Georgia's roots, We have liquidity providers. So we're trying to find people who are comfortable providing liquidity. And the arbitrage or the edge that we think exists is there's not a lot of liquidity providers right now. Dodd-Frank really neutered the sell side in a very big way. There's just not as many prop deaths. They can't hold positions in these things overnight the way they used to. So their balance sheets are under constraint. There weren't a lot of liquidity providers to start out with. People were more momentum-based, but I think the liquidity providing mechanism has...”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“One of the things that's always baffled me about these multi-manager platforms is you control the risk, you have objectives for risk return, sharp ratios, whatever the case may be. And it all makes sense from a risk perspective. But how does the individual PM make money?”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Feel comfortable with the fees they're paying so that they can make better decisions on who's there. One thing I should say because when I talk about this stuff, every manager here, we want to basically do the same thing. So we're looking for them to basically be able to make money on a rolling 10-day basis over 60% of the time, on a rolling five-day basis, over about 55% of the time. We want them to be able to make money most years running market neutral with high turnover with a sharp ratio that fits somewhere around one. Now that's a lot of demands. It's not easy to find. But I do think if you're trained in that way, you can do it. And that way we're looking for people that when we have this portfolio, none of them are correlated to any one factor for very long. And that way, if they're all not correlated to anyone factor, then when you put them in a diverse portfolio, the correlation of the overall portfolio to any factor is even lower. And our pairwise correlation amongst the teams is somewhere around 0.1 to 0.15, which means when you look at it.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Probably about a one and a quarter standard deviation. And for the week, they're flat. Now, if you're an outside investor, you don't have any data on that. I got to see and I said, why is there a two standard deviation move? What happened? So I'll go look at the factor risk. Doesn't show much factor risk. It wasn't idiosyncratic risk. So I started playing around with what customizable factors were going on. I looked at them. I looked at the pattern of their portfolio if they had it on the last three months. And it was something that was more similar to what was happening with a combination of quality and growth. And so my thought process then is to go talk to the manager a little bit and just get a sense as to what their portfolio represents, how they felt today when they were down this much. We have a lot more information. And by getting kind of a verbal connection with them at that point, it's much easier for us to make better decisions on the managers. And I just think that the outside world is going to have to get more transparent.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Fees are not the only issue. Obviously, you do have funds that are more passive than active, so their fees should go down. But really, the problem is you're making decisions on something very opaque and you don't know what you're getting involved in. So transparency is really important. And the joke I always make is, I don't like stories and I really don't. Everybody here is very educated. And if I ask someone why they made or lost money, they tell me a story. And I don't like stories. So we have the data now. And the data tells me the story and then we go in and we ask them why they took this risk. There's no stories anymore. There's just not. And so it's very integrated to where the data scientists and myself spend a lot of time looking at the portfolios. And I'll just give you an idea. There was a team yesterday that had a two standard deviation move in their P&L during the day. Now it ended up normalizing back to where it was only.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“We give the managers pretty much full autonomy. They provide us with their risk limits that's agreed upon with the risk committee and the allocation committee. They can stay within them and do what they want. We don't tell them what to do. We don't take their portfolio down. They have free autonomy to kind of move around the way they want. But here's the relationship. They know that we know what's in their portfolio. One of the things in this industry, which is still a problem today, which I think is going to be a major part of the next few years, the fees came under attack probably after 2016. It was a bad year, and I think that was the year that people really started to focus on them.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Let me give you one part here. So I stopped managing money for the firm in 2014. We hired Chuck Crow, our chief data scientist in 2013. We rolled out the full, as we call them, baseball cards towards the end of 15. All of that kind of coincided with the framework of risk that now exists today. So when you come out with a new approach, you don't actually know what the process is going to look like. You're incorporating some technology, but I think what started to happen, and we judged this by the success that we heard from the users,”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Momentum is happening in the earnings stuff, but now they're aware that, okay, I have this factor. So I should be aware of what could change it. And then the psychological side to me that I bring outside of the analytics is a belief that. For human beings to be able to be more flexible and have behavioral alpha, they need to verbalize things. So one of the things that makes them more aware and more comfortable with this risk is just verbalizing it to someone. And so I try to, when I see something has gotten bigger and bigger, we kind of have this little, okay, let's go verbalize with them for a while. Let's let them say what their exit strategy is. Let's say what the idea is. Let's make them say. And that way by saying it, generally it helps them, I think, when the decision comes down to either take it down they tend to be more proactive.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“The fundamental factors, I think, for everybody are the same and value momentum, quality, everything along those lines. We also use cross-asset risk premium. We also spend time on macro factors. We also do customized factors. So we've gotten into a world that I think is more thematic. Just use the tax cuts so there were companies that benefited from tax cuts. It didn't. That doesn't show up as one of the factors until they're all working and then it shows up in momentum. But in the interim, we want to know if that is a factor that's there. So that is a pattern recognition side and it's one of the machine learning techniques that we try to use is matching up factors that we can create. So I will create a lot of factors that I think are important. So if I see this interesting thematic idea and Goldman Sachs sends it to me and it's been working, then I will take that, put it in our system, and overlay it with a bunch of our teams and see if they've ended up in the same thing. Most of the time, it's not even intentional. It's just ended up that way because they like the”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“One of the things about being trained on the derivative side that I think has helped our ability to use the technology, it's not just that I coded at a young age, but a derivatives person is trying to hedge a portfolio completely with multi factors. So you're trying to eliminate all the Greeks in your portfolio so that on a daily basis, your P&L is moving based on what you want. In a portfolio with 70 stocks, let's say 35 by 35, most managers think they understand all the risk in their portfolio, and that's just not possible with 70 positions. So we try to dumb it down to eight factor risks that you have. And then we show them if you wanted to get rid of that factor risk, here are the names that you could do it with. Here's a swap you could create. This is the var that would come down if you do this. And then we give them basically an optimization button where if they press a button, it says this is what your portfolio would do to keep the names the same, but take the var down 70% and eliminate.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“show their ability to fold, their ability to be patient, their ability to be quick when they see something they like, to have forward-looking high hit ratio of taking down their portfolio at a gross level or at a name level, and probably equally as important as using new tools to figure out how to compensate for the biases. So some people just keep those biases, but they use tools to compensate for them.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“They're seeing, sometimes it's a feel, sometimes it's the sentiment, but this brings in the incomplete information that exists in poker, which has to do with the table. You're investing in stocks and you think they're going to go up because of fundamental reasons, but at the end of the day, you need other people to also buy them for that reason or to buy them in general to make them go higher. It was with Mike Milken recently, and he specifically said the reason he likes bonds as opposed to stocks from an investment standpoint is I don't need other people to buy the bonds. I just need them to pay me off. So I'm happy being the only person buying them in stocks. I need other people to buy them. I don't like that. And it relates to me in terms of the way that we've spent behavioral alpha here. So the position sizing, like when you pick names and you've got conviction, how good are you knowing the conviction in your names? There's an element in all of this of poker playing. And the most successful people we've had here over the last five years that have had the most consistent returns, their skills and bias.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Pitches above the waist and he bats 370 on pitches below the waist. Okay, so then what he really needs to do is try to only swing at the ones below the waist. Does he have the ability of doing that? And that's behavioral alpha. The ability of not letting your brain go after that high pitch is the problem. So it makes you both smarter that if you can see it, I always joke that the majority of what we learn as humans happens when we're young and we have all these connections that occur with seeing things. And most of what we learn is with our eyes. And so data visualizations become very important for this firm to teach people things, to just show them that, hey, you know what? When you size up your portfolio, your hit ratio is extremely high. When you take your portfolio down, your hit ratio is very high. Those are good things to know. You should be really increasing risk more even to what you're doing and decreasing more when you have these intuitive decisions. And they're not easy to quantify in terms of”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“As we've built out skills and biases, and I'll try to use a baseball analogy because when Moneyball was first out, I think the focus got into the part of finding advanced analytics, so different analytics than what people were looking at. So we'll follow WIP. We'll follow not just hits and batting average, but we're going to look at walks. We're going to incorporate everything in. So the baseball analytics just changed, and we started getting more analytics. And I think this industry has gone through the same thing. The other part is if you want to make someone better, you got to show them their biases. I'm sure everyone has seen when you watch the World Series or the playoff games and they have this box and when the batter comes up, it says, okay, he bats 180 on.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Changing your mind the right way behaviorally almost implies that there's information that you're responding to appropriately. The more you make these decisions, the less fundamental information there may be. So what is it? You're measuring to say, oh, behaviorally that was a good decision, that was a bad decision.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“In a poker, I think she said in one hand, you could have 20 different decisions that you have to make. And I'm sure the number can be bigger depending on the hand. If you're investing in making decision changes every six months or every year, that environment I just don't think works anymore if you want to get paid active management fees. So the fees have come down, and I think there's been alignment between who's an active manager and active management to me is all about behavioral alpha, the ability of getting out of stuff at the right time and sizing up at the right time, admitting that you made a mistake and folding your hand and moving on to the next one. Those are not easy decisions for people to make. And I think historically it probably wasn't as important as now because the inefficiencies of fundamental alpha have been stripped out of the market. I think you can't believe that you're finding something that other people and more importantly computers haven't found.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Again, this gets back to the point of cognitive biases and kind of highlighting to people what they do. So if you have a fear of missing out and you're part of the FOMO and you're going to put positions on because it's working and you're going with it and you assume you're going to be able to get out, we've had a massive movement in momentum in investing over definitely over the last five years. I think it was always there. I think it just paid off for most people. When value became more difficult starting in August of 2007, and I think value has been beaten down as an investment style, one of the major reasons was because we had this shift to where these mega companies, Apple, Amazon, Facebook, Netflix, Microsoft, all of them dominated from the 08 period. And we saw a lot of the value names fall down. I think behavioral alpha at the end from using kind of the Annie Duke framework in her book for making better decisions, can you be flexible in your mindset? Can you fold the hand? Can you size up very quickly?”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Time for it to go. Well, in emerging markets, it happens very rapidly. Flows go out, and the same thing happens with high-yield companies and things like that. And I think the cycles have changed significantly, and that has made it more important for managers to be more predictive and to know their space really well as to when they should reduce risk and when they should increase risk based on opportunities. And the paper that I just wrote for this year is all on the fact that I actually think this is going to get worse going forward, not better, that the cycles will be even shorter and sharper. And I thought last year was very similar to 2007, 2008 with a major turning point, which will change the investment environment for the next decade.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Was competing with hedge funds, and then money went more passive, and now people were competing with computers. And so the efficiencies just started to be taken out of the business. And for us, turnover was important, like poker. And so this gets, this is really the transition into something that I spent a lot of time thinking about, which is behavioral alpha. Do you have people that are making decisions based on the future and constantly reassessing in a Bayesian framework when they should be taking down risk, not after the event, but it gets back to what I learned about Mexico. If you have events like the devaluation of Mexico, you don't have a window to go make risk adjustments. You have to be doing it before. And that's very difficult for people that think that they'll be able to get out. So in cycles that before 2007 were elongated, and especially in the US, I think Abby Cohen said that getting the US economy to turn down is like turning a super tanker. It takes a long time.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“There's barely any returns, if any. You've had periods where it's gone on, but from that point it's been very difficult, and I'm not blaming Op because I think 08 was just a cycle. We've had plenty of little cycles, but the iPhone came into existence in June of 07, and then quantitative easing came into existence in the bottom in 09. Those two things had a huge impact, I think, on hedge funds. Number one, you had the competition from the quants, which really started to grow once the iPhone came in. We had advancements, obviously, in the cloud and everything afterwards that brought the barriers to entry down. So the quant space just started to compete. And the edge that managers had, to some degree, was not having that competition. So finding data that others couldn't find, and computers really good at finding it. But the second thing was we had a change in the demographics and in passive investing. So I think the money being managed by retail before 07 and obviously before 2000 created opportunities.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Think 2007-2008 was a year that people still Have not put enough care in thinking about why this Really disrupted the hedge fund industry. So if you look at hedge fund returns back to August of 2007, which was when the quant unwed, if you look at the overall returns of hedge funds and you just look at any measure,”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“We had to have turnover. So I think one of the biggest problems and the biggest change that ensued post the crisis, which we'll speak about, was the word static. It's static that's a problem to me. Dynamic managers, hedge fund managers, are active managers. Static managers are passive managers. And I think there were a lot of people in the hedge fund industry that were running passive portfolios that had a very small active component. And I think that's why the fee structures and a lot of things have changed over the years is as we got more granular data, you started to identify who was actually passive and who was active or on the scale of active and passive who was more active and more passive. So I think that was a big part of that period of really focusing a lot on the philosophy of risk of make them factor aware, let them know that we know what's there, try to find people that are able to produce consistent and persistent returns.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm going to kind of take it back to the philosophy that George had. So let's take the two things. So we want it to be quote unquote factor neutral. And instead of it being neutral, since there's really no such thing, we want it to be the manager is to be factor aware. So we had to have visualization that showed them what was there.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“management is that you really need to have a lot of data. It needs to be visual if it's tabular. It doesn't speak to you. And data visualization is the most important thing to me, heat maps, anything along those lines. And it was very simplistic back then because the computer power was not there. It's much easier today. But I think that was the biggest thing was get more granular data to make sure that we can make decisions. And that helped us a lot throughout the period 07, 08, and the crisis year.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“It was two thousand five when we met and earlier on in that year there was some issues that were going on with Delphi and General Motors and some downgrades and things along those lines that caused some disruptions in the credit market. The portfolio had a drawdown. So they had made a lot of money and then they had drawn down. So that's what led to him going, okay, I got to change some things. So the first adaptation was really bringing in a risk philosophy that had limits to the managers. And I would say we started the process of more transparency. We focused a lot as a risk committee before we launched. There were people that had been here, Rick Tousset, Apollo Wong, and some others that were very good on the wrist side that had built out some systems that were fantastic. And we just added to them, and I think we expanded that as a group. And that led to the first part of just trying to make sure that you could navigate things when crisis would come. So if you go back to the Mexico days, one of the beliefs I have.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Getting back to the reason why George was interested in speaking to someone, George had gone through a long time period where not only had they been highly successful, I think The family office returns were above 50% a year. So when you compound it 50% a year, you're really doing well and numbers grow big quickly. But also for him, the drawdowns were very limited.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Managers we chose had a long vial type return profile to go against some of the market neutral strategies. And so that's the way it looked. Then there were about the same amount of people there are now. There was a little over 100 right now. We're somewhere around 110. So we're right around the same number. Culturally, the place was unique. I mean, he focused a lot on ethics and values and culture. A lot of them were from the University of Pennsylvania, and he had recruited them to play football. So a very family office type feel that we've tried to keep as the firm has grown. And as we've changed people, and there's been changes over the years. But I would say that would be the way I would describe it.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“George, of why the turnover was the key thing to his success. He chose something where he basically was running kind of like a market-making business, and the banks were using him for liquidity purposes. So he was a liquidity provider, high turnover, market neutral, made it unique. So he had trained a total of five teams that are still here today. And that was during the late 80s and early 90s. And then he also brought on seven or eight other teams by the time I got here. So the multistrat was now about 13 teams, and it hadn't been launched yet. It was just running his capital. And so when I joined, the goal was, number one, I still wanted to manage a macro portfolio. So I brought my team here. And then once we launch, we would manage a portion of it. And I would build out effectively what would look at like an 80-20 structure. So 80% would be predominant long short equity market neutral. And then the 20% would be macro, macro.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“There's two parts. One is there were probably about 13 teams here. George had, there's a lot of people that credit him with market neutral, and I would say his version of market neutral to this day is still very unique. He ran a utility-specific stock fund during the 70s. We had our forty year anniversary in October. So this company's been around. We don't know of many more, if any that are older. But he really did combine the concept of no factor risk by being in utilities, and then by having high turnover. And that's the part that gets left out. So I think market neutral has kind of changed where we're talking factor neutral more. I think people have gotten smarter about factors, obviously, in the last few years. But George also added the element of turnover, which was really important. And as time went on, and I'm sure we'll talk about this eventually, I was fascinated by the whole thought process of.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“And needless to say, he may have said you're going to work here at that first meeting. I know we hugged. And I said to him, I'm like, I've never hugged my father, and I've already hugged you. So it was this like moment that was life-changing. And I think at that point, I had a trust and he seemed to trust me. And I explained the asset management vision in 2005 to him. And he at the time was 62 or 63. So he was looking for some sort of a transition. I think he wanted his legacy to continue. So at the time, we just kind of met and wanted to explore what that relationship could be.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“George was the most unique person I had met. One important thing, he was incredibly successful in the hedge fund industry, and at the same point he was one of the nicest people I had ever met. And those two don't go hand in hand normally in the industry. Most people get into it because of the wealth opportunities. And George had been very successful doing it. But there was just this thing about him that was very fatherly. And we took a liking to each other instantly. And someone had warned me saying, yeah, when you meet George, he's very charismatic. And if you're not careful, you'll end up working with him.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Wanted someone else to bring in. And so they just connected them. And I met George, and it was a life-changing experience for me.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“So I left in 03, launched a macro fund called Anchor Point Asset Management. I think at the peak, the assets got up to around $40 to $50 million. And I had a lot of hedge fund friends that invested both from Brazil and in the US and people that I had a great relationship with that kind of gave me good advice on leaving. But I realized at that point that to build an asset management company out starting with 50 million and kind of going through the stuff was going to be a long process. And in 2005, I just happened to meet George Weiss, not in an interview, but on someone who knew me saying George Weiss is trying to do a business plan where he's been kind of a family officer. He's trying to do a multistrategy fund. I'm really worried because he doesn't sound like he's comfortable with the returns and what he's seeing and he's been going down this path and he's looking for some advice on how to hedge out portfolio and he was talking to someone.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“And I just thought that the industry was ripe for the same type of disruption that the mutual fund industry went through in the 90s with exchange-rated funds and that the hedge fund industry would go through a similar thing. And then coming out of that disruption, there'd be an opportunity for new types of asset management companies. And that was all in a nutshell why I was running away from. And that's what 203.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“a big organization where politics were dominating. And I just reached a level where I realized that my job as I went higher and higher up was to fire people. And that was really what it was. And I didn't see the ability for the company of that size to adapt. And I started to get into technology. I think the most important paper I read in the early 2000s was by, I believe his name was Jim O'Neill at Goldman Sachs, and it was on bricks, and he coined the phrase bricks. And I started realizing that I should leave and focus on emerging markets, that the math was just there and that they were going to be the biggest part of the world and that emerging markets, Morgan Stanley was not set up for that. They didn't understand it. It was a cultural thing and their business was in New York and Japan and Europe and that we were getting into the lending business. And so I just viewed it as I think it's time for me to do something entrepreneurial, get a smaller place, build it out, and then finally I had spent enough time as a salesperson looking at the hedge funds.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“I've given you kind of the pros. One of the most important things and the reason that I left was a negative. At some point when I came back from Brazil, where I think at the beginning of the office there were ten of us there. So it was a little tiny thing. I think the last number I heard then there was over 200. So the office grew from that point into a big office. But when I came back to New York and they said, okay, here's your book. And these are the people you're managing. It was a very different experience. And I think when I left or made the decision to leave in 2002, the major reason was that I realized that whether it was because my father and his entrepreneurial side, whether it was my introvert and just liking things kind of quiet and going through it, or whether it was growing up in a divorce household and really wanting this team atmosphere that I had in my sports teams where I really liked the camaraderie, it was very, very different.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“They still kind of know. So the distribution of wealth problem in Brazil just had you on edge and you take that for granted in the United States that when you walk around, you don't think about these things.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“The biggest difference, and I just wrote a paper where I referenced that my parents went through a divorce and there was no abuse, but there was just no love. So it was constantly as a kid, you're wondering when the next fight's going to be or the next argument. And my grandmother was a stable force for me. In Brazil, it was very similar. You're living on eggshells. You constantly are worried that someone's watching you. I wore a Timex watch. I drove around in a Volkswagen rabbit, but I was the head of an office running the sales and trading effort down there. No one knew who I was. I didn't wear a suit, so I tried to hide in and blend in as much as possible. But even when you did that,”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“So there are a lot of things about me at that stage there where I had a lot to learn. And when I went to Brazil, Brazil was an experience that because I had never really been overseas for any long periods of time and now I was living in a country where English was not spoken, I think it built up another level of what I call elephant skin, which just thickened my ability to handle stuff. Brazil's not an easy place to live. And so in the last five years I've written many papers with adapter dye in there. And I think Brazil is my first kind of experience of adapter die. And it worked out extremely well.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“To train someone on what I was doing. And I informed them that I didn't have a passport. And they said, well, you have to get one. And I said, I don't know how to get one.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“Brazil was a big thing. I think my travel as a child involved New Jersey and Florida. And I don't think there was anything in between. I remember when Morgan Stanley said they were going to send me to London.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source
“I learned more than I can imagine by asking people questions. Because I didn't come out of school with a lot of memorization, I was learning on the job. So the books were one thing, and that was what I started with because I didn't want to be vulnerable to the option trader. So I actually wanted to get them to think that I knew what I was doing when I had no idea. So I had to go through and learn it. As time went on and I became less, let's say, fearful of being vulnerable and thinking that I was already realizing that I had something there that I should pay attention to, I just started asking people questions. And I always say to young people that I get involved in that you have a lot of curiosity and creativity and you can destroy it if you stop asking questions. And questions are really important. And I would say that I asked a ton of questions to people about everything, how to manage people, markets. I spent a lot of time getting to know people and all the other divisions. And I'm an introvert. So this is not like socially easy for me to just go out there and talk.”
2021-11-08 · Capital Allocators · [REPLAY] - Jordi Visser – Next Generation of Manager Allocation (Capital Allocators, EP.92) · IDENTIFIED FROM THE TRANSCRIPT · source