Behind the Balance Sheet #7 A Scotsman and an Englishman - Dylan Grice & Rob Crenian on Markets, “Stupid” Winners & Calderwood’s Unconventional Strategy
7 snips
Feb 17, 2022 AI Snips
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Episode notes
Renaissance Preferred Kepler‑Style Data People
- Renaissance hired people with astronomy and empirical science backgrounds who handled messy, large data sets well.
- Crenian compares good quants to Kepler collecting telescopic data rather than Newton-style closed-form theorists.
Markets Reward Different Strategies Over Time
- Markets select the strategy the environment rewards, so past winners often stop working once the regime changes.
- Dylan Grice explains recent years rewarded gullibility and reckless growth bets, so robustness beats copying popular winners.
Harvest Niche Risk Premia Instead Of Betting On Stars
- Avoid betting on picking the single smartest manager; instead harvest identifiable risk premia that exist for structural reasons.
- Grice and Crenian allocate to niche, capacity-constrained markets like reinsurance and litigation finance to capture durable premia.