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Thursday, August 28, 2025
Crisis Alpha
What do you guys use to generate alpha and convexity during a crisis? This is very important if you do not want 50%+ drawdowns.
I think 60/40 may no longer work as expected going forward. We need something that is more reliably anti-correlated with momentum stocks ("passive" SPX is a momentum strategy).
Long/short managed futures is promising. Treasuries are correlated with stocks during inflationary periods. Gold is good but only for certain types of events. Bitcoin is mostly a risk asset itself. Forex carry trades are non-correlated but not anti-correlated.
Hong Kong finance official, lawmaker withdraw from bitcoin event featuring Eric Trump as headline speaker - Hong Kong Free Press HKFP
https://hongkongfp.com/2025/08/28/hong-kong-finance-official-lawmaker-withdraw-from-bitcoin-event-featuring-eric-trump-as-headline-speaker/
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