YouSaid · the spoken record

Kyrill Asatur

lines on the record: 77
first: 2022-07-18
most recent: 2022-07-18
sittings or episodes: 1
sources: podcast

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“Yeah, and tell me about Center Finn's ability to access funds that alternative, let's call them, that normally are not accessible to retail investors. Why was that important? And then we can get into the alternative, like distressed, macro, long short.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Absolutely. No, I mean, look, I do think they did a great job in kind of, you know, putting pressure on the brokerage industry. There's a ton of fat in anything retail oriented on Wall Street. That's kind of one of the reasons we started CenterFin also. And so kudos to them for including this whole new part of the world into financial markets. But I do think there's a balance that needs to be had there.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“There is no free lunch. That's kind of the basic lesson, right? Like there is no get rich quick scheme, right? The to the moon memes are temporary. It's just doesn't happen, right? This whole concept, one of the things I really respect Robin Hood for everything they've done and what they've built and having started a company, it's very difficult. But this concept of trade stocks for free is just misleading, right? There is no free lunch. There is nothing free, right? And we learned this with Facebook a while ago, right? If it's free, you know, you're the product. And so I think that that's an important lesson because I think most people just thought stocks go from, you know, up and to the right forever. And that's just not the case.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“People a lesson. Like, I learned a very hard lesson. It's helped inform my view over the last couple of decades as I've been working professionally in finance. And hopefully it teaches people, the younger generation today that's entering the stock market the same lessons because I think they're valuable. It's obviously”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“You had, I remember internet accelerators, right? So these were companies that basically they had all these like internet companies under their belt that they incubated. And they traded at crazy, crazy valuation multiples and they all crashed. And most of them actually, I think all of them went away. So I think there's a lot of parallels to that. And I think that we saw this clearly when you saw this meme stocks and stuff back in the 90s. It wasn't on Reddit. It was on the message boards on Yahoo Finance, right? Like, I mean, I was on those message boards. It's very similar. So there's a lot of parallels and there's a lot of, you know, history rhymes, as they say, to what happened back in the late 90s. And I think it's healthy and unhealthy at the same time. It's healthy in that it helps teach.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, it's a great question. So I think no, as they say, and it's a little overused, but no two periods are exactly the same, right? But there's similarities. And I do think there's a lot of similarities between what happened kind of post-COVID and the explosion of retail trading with platforms like Robinhood providing an easy way for more entrants into the market to when I was in college and e-trade was a new thing back then where I can open up an account online, I can trade for relatively cheap relative to history at that point. And you had all these new dot-com stocks that were promising to change the world that were trading at crazy valuation multiples. So at that point, this last two years, you had electric vehicle stocks and other high growth tech companies that were part of the quote unquote bubble in the late 90s, early 2000s.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“To believe in the prior QE period, if anything, I would say, again, at a very high level, I think that has grown the inequality gap, right? Because only the top whatever it is, 10% of households, at least in the US, own financial assets like stocks and real estate. And that policy has helped those assets grow in value. Most of the population actually does not own financial assets, right? And so I don't think that the Fed is going to be concerned about stock prices, but I do think it does have an effect on the real economy. And they need to be cognizant of that.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Has been healthy. The Fed has been very happy with their policy. But I think, again, not to beat a dead horse, but I think we're living in a different environment where we do have an inflation problem that we haven't seen since the 1970s. And the Fed has to act differently. And I do think, yes, it does have an effect of slowing down the economy because whenever you tighten monetary conditions, it's going to feed through to the real economy and slow down the economy. And we are already seeing some of this, right? Like you've seen economic data, except for the jobs number, get fairly weak in the latter part of the second quarter. So I do think that there is a correlation to Fed policy and the real economy, but I worry about the Fed is not worried about, I think, stock prices, which is what I think people came.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“That's a great question. I don't think I have a super smart answer except that, you know, if you look at history as a guide, you did see the effect of monetary policy flow through to the real economy. And so, you know, the Federal Reserve at the end of the global financial crisis, they did things that were unprecedented at the time, quantitative easing, which is now something that we've come to accept. If you recall, that is something that was supposed to be temporary. It was supposed to be a temporary measure. It became something that was common for 12, 13, 14 years. And I think that that has led to asset prices being higher. And I think the economy is kind of just kind of, you know, trounced along the whole time as long as the economy has not been in a recession and the jobs pick.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Going to be with the SP 500 at a certain level. It's going to be with something breaking in the credit markets. And so once you see cracks in the credit markets, which you've seen spreads blow out just recently, just in the last quarter, but they're not outrageous at this point, there's nothing broken right now, right? I mean, there's not a lot of capital markets activity because companies are not expecting to be financed in this market environment, but nothing seems to have been broken yet. I think, you know, once you see some cracks in the credit markets, that's probably where the Fed starts to get focused on whether or not they're too tight and maybe pausing or going the other way.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I think so. And I mean, the concern is that the more we talk to people in the know, the more that seems to be consensus, which is always kind of concerning. But like somebody just recently that I was talking to said, you can't just be bullish because everybody's bearish, which is true because I do think we need to adjust for a new monetary regime. And to your point about the Fed, the Fed is focused on inflation. They're no longer focused on, again, the jobs picture remains pretty strong. And so they can't, that part of their mandate is fine and inflation is not fine. And so I think that we need to mentally adjust away from this by the mentality and really think through the second and third order effects of what this Fed policy means. And I think where we'll see it and where the potential for the Fed to pause is not.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Meeting. And he wrote about how the Fed is, and Jay Powell is hyper-focused on not repeating the mistakes of the early 1970s where the Federal Reserve under Arthur Burns, they hiked, and then there was a recession fear, so they eased and inflation continued to be a problem until Volcker came around and really got inflation under control.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“The maximum employment mandate based on last Friday's jobs number is doing just fine, but that price stability mandate is out of control. And so lots of folks are talking about how the Federal Reserve is going to pause because there is a recession coming. But until they see it in the jobs numbers, it's hard to see how they pause because inflation is high. And maybe it's peaking, but on an absolute level, inflation remains too high. And I think the Fed is going to continue to hike to bring that down. There was an article yesterday in the Wall Street Journal by somebody who seems to be somebody that the Fed uses to kind of get their views out. He was the one who broke the scoop that June hike might be 75 bips instead of 50 bips, which was priced in the week before.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Market move that predated COVID, but then got exacerbated by COVID, right? I wrote about this in our quarterly letter. If you take a step back post-financial crisis, we've been in this loose monetary environment for a very long amount of time where inflation has been under control. And so the Federal Reserve kind of every time stocks pulled back or there was weakness in the economy, they just basically did more of what they were doing before, which was providing easing into the monetary in their monetary policy. And so, but that'll change at the beginning of this year, right? So inflation proved to be, as we were talking about before, less than transitory. The Federal Reserve has a dual mandate, and that's maximum employment and price stability.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so my personal bias, I think, has always been somewhat of a glass half empty type person. And so I'm generally, and I know this about myself, I generally do tend to get caught up in what's referred to as macro bear porn, right? I mean, it's, you know, you read about some of these stories and they make sense and they convince you that the world's going to come to an end and you should just go to cash and hide everything under your mattress and whatnot. But being cognizant of that bias is important. And so my bias to being bearish and the current thinking is largely due to the fact that in the kind of medium term, I think we've seen a pullback from what was a very monetary environment liquidity driven.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Right. So you said you have a bearish bias. How are you thinking about it now in terms of the Fed, in terms of inflation, as well as other macro drivers of risk assets, namely, let's say, the S&P 500?”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“No, yeah, it's great to have kind of a healthy debate. Again, given our experience, our CIO has spent a lot of time in the hedge fund industry myself as well, having kind of different biases. And I do tend to have a more bearish overall bias while our”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Right. And so I know we were speaking earlier, you have a certain view, your chief investment officer has a different view to what degree do those views get implemented in client portfolios. Is it in the basis points of we're going to up the copper allocation from 76 basis points to 77 basis points because Kirill is feeling pretty bullish on the long-term electric vehicle story? Or is it more significant than that?”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, no, it's a great question. So it's a mix of all the above with the exception, at least yet hedge funds today. So right now we express our views via ETFs that either trade the features as a physical, as well as commodity equities, right? Commodity equities actually, you know, our CIO, and we discussed this on a regular basis. There's actually some benefit to owning the commodity equities if you're bullish on the underlying commodity. And so we have a mix of the two currently.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“And let's say a client says, I really want to be allocated towards commodities. Are you then investing in sort of hedge funds that buy commodity stocks? Are you buying commodity stocks yourself? Are you owning ETFs that have futures positions? Sort of, what give us the range of how you do commodity investing?”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“And electricity as a source of energy for vehicles, you need a lot of these input commodities to make that happen. And so long, there's a very bullish fundamental picture for commodities, almost all commodities at this point. And so our view has been, you know, while they've rolled over, we've maintained our existing exposure at this point anyway. And we think long term fundamentally the picture is very bullish for commodities.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, it's a great point. And this is where I think the balance of the kind of short-term market moves in the longer term perspective comes in. So commodities did behave as expected kind of in the first quarter. But as you know, everything kind of rolled in the second quarter, everything kind of rolled over as we started to see recession and growth fears. And so all of the commodities have now come down because the market's more focused on potential recession hitting us than it is on inflation, right? And this was, you know, we were kind of witnessing this throughout the second quarter and discussing it internally. And the underlying fundamentals for commodities, right? So copper, gold not so much, but say copper as an example. There is a fundamental supply demand imbalance given that we are moving globally into this electric vehicle.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“But that's how we approached it because we felt like what is the beneficiary of inflation? It's obviously commodities is the obvious place to be.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, so it's actually very relevant to the conversation we're having exactly today in kind of mid-2022 because we're kind of sitting in a place where it's not clear that the market has clearly that the market has found a bottom at this point. But we are also managing money on a 10, 20, and 30 year time horizon, right? And so that's the balance of trying to figure out, you know, how do you position clients to mitigate that drawdown while maintaining that long-term mindset. And so what we do is we kind of shift things around in the portfolio. And so, you know, at the end of last year to your question about what do you do with the cash once you sell the fixed income exposure, well, we came into this year with a heavy allocation to commodities, precious and base metals. Some natural resources, although we were clearly underweight energy and we kind of fixed that during the first quarter.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Interest rates on fixed income assets become negative and hence they're uneconomic to hold and hence it's not a good place to be. And so what we've seen in the first quarter and continue it throughout 2022 as the narrative around inflation and the data has been obviously more than transitory. We've seen fixed income assets fall in price as yields have gone up. And that's a good example of how we use our macro view. So it wouldn't be offensively, so to speak, it would be more defensively.”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“How this kind of reflected itself recently at the end of last year, as you recall, everybody on the sell side and the Federal Reserve was talking about how the inflation that we were witnessing in 2021 was likely to be transitory. We had formed a view in kind of talking to a lot of our network that there's a decent probability that inflation was going to be not transitory and was going to stick around a little bit longer and be more of a problem than what was being spoken about at the time. And so what we sat down to think about is, you know, what is the obvious thing to do for clients if you think inflation is going to be more of an issue than what is being priced in the markets right now? And one of the most obvious things to do is really just limit exposure to any traditional fixed income assets. Because if you think about the way that inflation works, real”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, absolutely. It's a great question. And macro is ever so more important today than it has been in recent past. So about Centerfin. So we started Centerfin about two years ago and went live with it at the beginning of this year. We manage money on behalf of individuals. We are a registered investment advisor. We manage money with a long-term view, but we take into effect a global kind of a global macro view in helping us with our asset allocation. So we're not an automated advisor. We're not a passive investing platform. We are really utilizing decades of experience in the hedge fund industry and the relationships that that experience has brought to the team to help inform how to position clients in this very unprecedented market environment. And so as a great example of how this”
2022-07-18 · Forward Guidance · Making Informed Decisions as an Individual Investor | Kyrill Asatur · IDENTIFIED FROM THE TRANSCRIPT