Lead-Lag Live

The Hidden Bus: Preparing for Market Uncertainty

• Michael A. Gayed, CFA

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Ever notice how the biggest market disruptions are rarely the ones everyone sees coming? Brad Barrie challenges conventional wisdom about diversification with his compelling "bus you don't see" analogy, explaining why most investors remain vulnerable despite thinking they're adequately protected.

"Diversification is not more stuff," Brad emphasizes, dismantling the common misconception that simply owning numerous investments creates safety. His multidimensional asset allocation approach transcends traditional thinking by focusing on diversifying return drivers rather than just asset classes. This subtle but crucial distinction makes all the difference when markets experience unexpected shocks.

Through practical examples like the recent tariff volatility, Brad demonstrates how investors often underestimate visible risks while remaining completely blind to others. His counterintuitive wisdom that "diversification means always having to say you're sorry" reveals an uncomfortable truth: if everything in your portfolio performs well simultaneously, you're probably not truly diversified.

Brad explains how his Dynamic Alpha Macro Fund (DYMIX) embodies this philosophy by combining equities with discretionary global macro futures strategies. Unlike trend-following approaches that struggle in choppy markets, DYMIX positions based on fundamental theses that remain valid regardless of broader market conditions. This creates genuine non-correlation not just to stocks and bonds, but to other alternative strategies as well.

The conversation delivers actionable insights for both investors and advisors seeking to build more resilient portfolios. By understanding the specific drivers behind different investments and combining multiple uncorrelated return sources, you can better prepare for the investment "buses" you never see coming. Visit dynamicwg.com to learn more about Brad's multidimensional approach to navigating today's complex market environment.

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Speaker 1:

One of the analogies I use is it's the bus that you don't see that hits you right. So if you see a bus coming, you usually get out of the way right. So most recently we've had these tariff gyrations. And did we see the tariffs out there? We did, we saw them out there, but we just thought it was. We didn't think it was a big bus. We thought it was going to be a much smaller, maybe one of those smart cars, right, or a bumper car. It wasn't going to be anything major. And then it was major, and then that was a huge bus that came and hit us. So how?

Speaker 2:

should investors think about and financial advisors think about? Diversification beyond just sort of the idea of feeling better because there's more securities in a portfolio. Yeah, divers on just sort of the idea of feeling better because there's more securities in a portfolio.

Speaker 1:

Yeah, diversification is not more stuff, right? It's not just different. More stocks, more funds, and oh look, I've got 10 different names in my portfolio. I must be diversified, it's not so? The other old saying out there on diversification is diversification means always having to say you're sorry, right? So if there's not something in your portfolio that you're not happy with, then your portfolio is really not diversified.

Speaker 2:

My name is Michael Guy, a publisher of the Lead Lag Report. This Lead Lag Live conversation is sponsored by Dynamic Wealth. We'll be talking about Bradbury's firm, as well as the offerings he's got. But, brad, let's refresh everybody's memory as far as your background, what you've done throughout your career, your experience and what you do at Grotton.

Speaker 1:

Yeah, thanks, michael. Yeah, it does seem like it's been years since we've done one of these. Time tends to fly very rapidly, especially in these uncertain world that we live in, even though it's always uncertain. So my background I was a financial advisor for about 20 years, started at the end of 1990s and had a financial planning practice in Chicago area. I transitioned that to my partners, began consulting financial advisors on various topics. Basically your investors, your listeners, can kind of think about it as they may go to a financial advisor when they need help. Where does a financial advisor go when they need help? They come to somebody like myself. So with my experience and knowledge and focus, I help advisors in a number of different topics.

Speaker 1:

A lot of that last few years had pivoted towards portfolio management guidance and, brad, what do you know about portfolios? 60-40 isn't working as well as it used to be and kind of pivoted our firm to focus more on CIO work and sometimes the industry calls it an OCIO, an outsourced chief investment officer. We like to think of it more as a partnering chief investment officer with financial advisors. So we partner with firms. We don't replace their team members. We hopefully make everybody that much better and build customized model portfolios for financial advisors that follow our multidimensional asset allocation theme, which I'm happy to touch on.

Speaker 1:

Asset allocation theme, which I'm happy to touch on, and a number of years ago a few years ago now we launched a mutual fund, the Dynamic Alpha Macro Fund ticker symbol is DYMIX which we'll talk about today. That combines equities with the global macro future strategy. So that's just a little bit about me. I can probably go on and on for hours. I also, very charitably inclined I run a nonprofit here in the Las Vegas area called the Alliance Foundation, sat on a number of nonprofit boards and definitely a big believer in giving back to our communities that we all work and live in. I believe if we all just do a little bit, you know, adds up to a lot.

Speaker 2:

So that's me. I've talked to a lot of financial advisors. Some of them are more intellectually curious than others when it comes to markets. As you know, Over the years I used to be even if they have the CFA designation, are really kind of, I'd argue, more hyped up retail right, Meaning they will fall prey to the same behavioral biases that retail investors and traders typically do. Am I off on the idea that a large portion of the financial advisor community, they, don't really understand markets the way that maybe they portray themselves to be understanding of markets?

Speaker 1:

I think, yeah, I think, when you think about a financial advisor, their job is to advise clients on all aspects of a client's financial life, right. Investments is just one component of that. There's cash flow management, there's income tax planning, there's estate planning, there's insurance planning, there's retirement planning, college planning. A good financial advisor, I believe, looks at the holistic approach and partners with folks like myself on investments, partners with good estate planning attorneys, good tax preparers and advisors to act as that you know, sometimes as an overused analogy the financial quarterback for their client right and connect industry experts, financial experts, to understand the real client's goals. That's what a good financial advisor does is understand their client's goals, their risk tolerances, what they want to achieve, and then helps point them in that correct direction. Direction right, Look, we all love to follow the market and you know we talk about uncertain times that we live in and I alluded that all times are uncertain. Even when it seems like we're in certainty, we're not. There's always unexpected things around the corner and we can't expect them. That's why they're unexpected right, One of the analogies I use. I'm a big believer in using analogies with investors and if you are an investor, I think it's good to put things in terms that you understand, that you can relate to, Because if you understand it, if your investors understand it, your clients understand it, then comfort level is higher and folks are more likely to stick with the plan. Whether that's a financial plan, an investment plan, an investment, it doesn't matter. If comfort level and understanding is there. Being able to stick with it long-term is the key, right?

Speaker 1:

So one of the analogies I use is it's the bus that you don't see that hits you, right? So if you see a bus coming, you usually get out of the way, right? So most recently we've had these tariff gyrations. And did we see the tariffs out there? We did, we saw them out there, but we just thought it was. You know, we didn't think it was a big bus, we thought it was going to be a much smaller, maybe one of those smart cars, right, or a bumper car. It wasn't going to be anything major. And then it was major and then that was a huge bus that came and hit us. No-transcript, not letting your emotions dictate your actions, I think is a core lesson, right, and kind of keeping those analogies in the back of your head maybe helps you put that into perspective, you know my thoughts.

Speaker 2:

Nomadic advisors can be emotional too, oh absolutely. They're supposed to be hand-holding their emotional clients, but emotion has a funny way of transferring over from person to person.

Speaker 1:

Well, we're all human. We're all human At the end of the day, until those robots take all of our jobs right and we're like the humans in WALL-E and it's a great movie. If you haven't seen it, you know you got to watch that and you know the humans there are just kind of all floating around and everything's done for them. We're all human. We're all driven by emotions, and in the investment world, fear and greed are two big emotions.

Speaker 2:

And you know we all have them. So tell me how some of those advisors maybe in the midst of this tariff volatility which you know in the grand scheme of things it was a short period of time, maybe coming back to it Were you getting calls from advisors on the OCIO side? What were the conversations like? Talk me through that period a little bit.

Speaker 1:

Yeah, so we're very proactive. So when that really started to happen, nobody knew how long it was going to happen for right. You know it was a very quick blip in retrospect, but who knew right? So we were very proactive. We put out a video on YouTube and LinkedIn to kind of help investors and advisors put things in perspective. We reached out to our advisory teams we work with with that type of information and some thoughts and perspective.

Speaker 1:

But the most important thing during those buses that hit us is to focus on the facts, focus on logic, try not to let your emotions drive you and again, we work with amazing advisors and they all get it right. Our advisors were not panicking. It was more of you know what are the best topics to reach out to our clients. Is now the right time to reach out to clients? And it is. And it's not to reach out to clients to scare them or make changes. It's to reassure them that, especially the clients we work with, reassure them that their portfolios are positioned Now.

Speaker 1:

By definition, the bus that hits you is something you can't predict Right. So we're big believers in preparation over prediction, with overall portfolios that are built for investors, because you can't predict but you can prepare, and our message is be prepared for a range of outcomes. Yes, I mean, michael, this was a fast blip down, a 9% rise one day and we're, I think, back to those levels pre the. The liberation day, I believe, is it's called uh, with the, with the tariffs now, that rain, that outcome? Certainly, people were predicting that and there was a lot of people predicting even worse. Um, you know, the people that predicted it would be a fast bounce back. They were, were right this time. Will they always be right? No, so, if you know, I've heard the word hope often, right, we hope these tariffs are just negotiating. We hope this is all just positioning. We hope that, that this isn't going to push us into a recession and I've heard people on the television, experts use that term and look, I certainly hope that's the case as well.

Speaker 1:

But what if it's not? And if it's not? And your portfolio is mission critical. Mission critical to support your retirement plan, for your kids, college, be there for you when you need it.

Speaker 1:

Hope and optimism shouldn't be your only plan, right? So, having parts of the portfolio that are positioned to do well in periods like that and we did we had a number of positions in our portfolios, our fund included, that did well during that time and many of which have continued to do well and did well in the past as well. So having multiple drivers of return that don't rely on strong economic growth is, by definition, diversification. And yeah, so our advisors were, I will say, prepared for the uncertainty as we always need to be prepared for the uncertainty and communicated I don't say positive messages, but reassuring messages, because that's what investors need during really all times, during really all times, even when the market is doing fantastic. That's when reassurance and proper portfolio management is even more important to lock in those profits when they happen and not take on too much risk and not keep just the magnificent seven.

Speaker 2:

Let's talk about diversifying hope. How does one properly do that? Let's face it, I think it's arguable that most things are just variations of beta in terms of an opportunity set. Even if you look at long-short portfolios, for example, they often just track the consumer staple sector ETF just because it's a lower beta with right With the net long exposure, but still beta. So how should investors think about, and financial advisors think about, diversification beyond just sort of the idea of feeling better because there's more securities in a portfolio?

Speaker 1:

Yeah, diversification is not more stuff, right, it's not just different. You know more stocks, more funds, and you know, look, I've got 10 different names in my portfolio. I must be diversified. It's not so. Our approach, we call it multidimensional asset allocation. It focuses on not just diversifying with asset classes but diversifying with strategies. Different strategies and different approaches.

Speaker 1:

Right, you know, you may have many different types of stocks or even private equity, but what do they all require? They all require strong economic growth by and large. If we don't have strong economic growth, then all those equities, if there's a macro hit, are most likely all going to suffer to some degree. Macro hit are most likely all going to suffer to some degree. So, having you know, and even long short strategies you mentioned, michael, are there's many different types of long short strategies and different types of tactical strategies. Some use quant, some use fundamental, some use technical analysis. There's different arbitrage strategies out there that may perform more like a bond in the long term but don't have any interest rate risk or any default risk. They have, whatever their arbitrage be it convertible arb or merger arb or otherwise, um are a rely on.

Speaker 1:

So you know, harry markowitzowitz, the father of modern portfolio theory, asset allocation, diversification, whatever you want to call it talked about having different risks in a portfolio and many folks tend to again misunderstand and think that he talked about having multiple assets in an asset allocation. But that's not really what it is. It's having multiple types of risk in a portfolio, which sounds odd at first that we're going to add risk to a portfolio, but when you add one risk, you're taking away another risk. So in the traditional 60-40 portfolio stocks and bonds you have really two main levels, two main drivers of return stocks and bonds and a year like 2022 or years like others in the past, when both underperform or go down. You had two diversifiers.

Speaker 1:

We think and this is why we call our approach multidimensional we think you should have multiple types of drivers of return. So if you have just a buy and hold stock portfolio, that's one driver of return. Buy and hold bond portfolio is another driver of return. Having a tactical manager that is going to be able to move between stocks and bonds overweight stocks, underweight stocks, move to bonds different types of bonds that risk is not necessarily stock risk or bond risk. That risk is that manager successful in their ability to move between those different categories, and there are a number of managers that are successful in that and that takes away the buy and hold risk and transfers in the technical risk. And that's our view on asset allocation. It's a view I've had and I've used with clients for well over 20 years when I was in private practice and it works.

Speaker 1:

And even if you take a step back and you think what is the main purpose of diversification from a practical standpoint and again, this is, you know, I don't know if CFAs are taught this and and from the academic standpoint, but from a practical standpoint, as someone who has built portfolios for individuals that have been retired and relied on those portfolios to live on, and I got calls like hey, the car broke down, we need $15,000, $20,000, $30,000 out of the blue. What do we take from? Part of the goal of diversification is to always have something in the portfolio to draw upon for when that bus hits you, for when that unexpected occurrence happens right and the refrigerator blows up, the car breaks down, the kids need money, what have you? And if everything in your portfolio is down or not doing well and you have to take something that is down and you sell it, you're selling at that loss and you'll never recoup it after you sell it from a loss by definition.

Speaker 1:

So the other old saying out there on diversification is diversification means always having to say you're sorry, right, so if there's not something in your portfolio that you're not happy with, then your portfolio is really not diversified. It sounds silly, but the other way I say it and I would say this to my clients and many times they would finish my saying I would say if everything in your portfolio is going up at the same time, it usually means everything in your portfolio will go down at the same time. Right, and you know, having that it's really a different philosophy and a different perspective on what diversification really should be. Right it's not just having 15 different investments in funds and a bunch of different stocks, it's identifying different drivers of return that you know beat by a different drop and you know maybe they all go up at the same time but in certain times and other times they won't. And identifying those drivers is kind of a key part of the diversification.

Speaker 2:

Sorry, about your fund for a bit here, your mutual fund DYMIX, sharing the screen here, but yeah, let's go through it.

Speaker 1:

Yeah, so DYMIX, as we call it, is our mutual fund. Let me share the fact sheet first of all. So, from a high level, our mutual fund, it's been around almost two years now. It combines a global macro futures strategy along with US equities. Now US equities are balanced between growth stocks, dividend-focused stocks and kind of a broad market think S&P 500-type stocks. This is kind of the buy and hold equity position and then within the global macro futures position, we can go long or short various commodity futures markets. So which you know from a high level, they're all listed below and this was as of March.

Speaker 1:

Our performance has been very strong on really all aspects relative to the S&P, and the S&P target risk balanced index is a 60-40 mix. We're very proud of those numbers. In addition, we're proud of the risk and our non-correlation. So if you look at the column here, you see my mouse. Our standard deviation is just slightly higher than the S&P. But one of the things I like to really emphasize is our standard deviation is not risk. So standard deviation is deviation. So if you think about that and I don't know how to use a laser on this, so I apologize, otherwise I would point. I don't know if I highlight. I can highlight a little bit. I guess Most investors want to deviate on the gain side, right? You know, if you're deviating and you're looking different and you're making more on the gain side, that's what you want. You don't want to deviate on the loss side as much, right, and have greater deviation on the downside. So we're very proud that our gain deviation is more of the contributor to the overall standard deviation than the loss deviation and that's why our Sharpe ratio and our Sortino ratio are as high as they are.

Speaker 1:

From a very simplistic standpoint, sharpe and Sortino you can kind of think of it as return divided by risk. Sharpe uses standard deviation as risk, which we know we're not a huge fan of as a measure of risk, and then Sortino uses downside deviation as its measure of risk. Basically, the higher the number the better. With Sharpe and Sortino, correlation to the overall market is 0.28. So we're very non-correlated to the overall market. And then upside and downside capture ratios. It's also another one of those statistics that most financial advisors should be familiar with. Investors think of it this way is the market is going to capture 100%, so the S&P is going to capture 100% of its return on the upside and it's going to capture 100% of its return. On the downside right, the 60-40 portfolio was about 67 up, 73 down since our inception period we captured almost 70% of the upside of the S&P 500 with only about 28% of the downside of the S&P 500. And that's because of our kind of overall, non-correlated approach.

Speaker 1:

This slide here I'll show you. We'd like to compare how we've done relative to major asset classes. So again, this is since our inception timeframe as of end of March of this year. Again, a return, very strong correlation to the market. Alpha is a measure of risk-adjusted return. Again, higher the alpha, the better. Beta is a measure of risk, the lower the number, the better. And again, sartino is one of our more favorite. But you compare us to different types of stocks, obviously bonds, and sometimes we get confused for managed futures strategies, which I want to touch on a little bit Just for a compliance standpoint. I'm going to show the rest of these slides to keep compliance happy.

Speaker 1:

So all those slides are shown. So, again, our fund invests in global macro futures and equities. Sometimes, again, investors will hear futures and they'll say, oh, you're a managed futures fund or you're half a managed futures fund and technically we invest in futures and those futures are managed. But most managed futures funds tend to be more of a trend following approach. As a matter of fact, one of the reasons that we launched this mutual fund is because I didn't know of another mutual fund or ETF that existed out there. That is a discretionary, fundamental global macro strategy. Right Again, I was a financial advisor for nearly 20 years, happily consulting with, helping financial advisors be even better financial advisors. I never sought out to launch a mutual fund and be a mutual fund portfolio manager. Our global macro manager has done an amazing job running this strategy that it made sense to make it available to financial advisors and average investors, which is why we launched it. But getting back trend following managed futures follows a trend and I don't have the data to look up, but financial advisors, investors, can look up their favorite managed futures ETF or mutual fund and look at their performance year to date or over the last year, and they probably won't be exceptionally happy with the returns, Right. So the the trend following index, which is the SD trend index since our inception, is down 2.81%, Right, why? Well, what's the trend been like? The trend has kind of been like an EKG machine, Right, it's again the tariffs. It's, you know. Tariffs across the board 170% tariffs. Market plummets oh, 90-day pause. Markets are back up, you know, 9 percent in one day. So if you don't have a trend riding, that trend wave can be a challenge. Right Now we like trend follow-up.

Speaker 1:

You know in our models that we build our multidimensional models for financial advisors. We incorporate trend, be it through ETFs or mutual funds, but our fund complements those. Sometimes I'll use the phrase non-correlation is not binary, right? It doesn't mean, you know, oh, binary is one and zeros, right, you either have it or don't have it. Well, I've got diversification. I have one alternative. You know trend. I use long short. Well, maybe that is non-correlated, but that's one, that's binary, you have one. What about multiple? And again, this is why we're multidimensional.

Speaker 1:

If I showed you, we're non-correlated to the S&P at 0.28, we're also non-correlated to trend. Again, it doesn't show on this screen. If advisors would like to see those numbers, please contact me. I'm happy to send you the analysis on our long-term correlation relative to other trend managed futures strategies, other alternatives. We're non-correlated to them as well as equities versus most other managed futures funds are non-correlated to equities and bonds, but correlated to each other. Right, so you know we help during these unexpected periods and, yeah, we're very, very proud of that. The one thing I forgot to mention, which you know is silly of me not to mention it, as we were the number one fund in Morningstar's macro trading category for 2024. Um so, even, uh, even a great year for stocks like 2024, where the market was up over 20%.

Speaker 2:

We were up, I want to say also close to 20%, in 2024 because of our innovative strategy combining equities with the global macro futures and taking kind of a different approach towards it, anything that you can share in terms of how macro positioning may have altered changed, I mean, I know you can only disclose to some extent some of the holding shifts, but anything that looks different in terms of that side of the portfolio compared to the prior year.

Speaker 1:

Yeah. So look in our global macro future side of the portfolio and we try to be as transparent as we can Right. So right on our website, which is dynamicalphafundscom or dynamicwgcom, as it says right next to my name, we publish monthly updates on our mutual fund, on what's contributed, what's detracted, what's changed in the portfolio month to month and what our current positions are, and we touch on why we're positioned in. That and this is one of the beauties of being a more of a discretionary fundamental strategy is we have logical reasons. It's not because the quant model triggered and and X, y, z happened in the black box told us to do it.

Speaker 1:

Um, again, nothing wrong with those strategies, we're just different. Um, and I think sometimes we're easier to understand and and, um, and understanding is there. It's easier to stick with our strategy. So, um, look we, we had, we went into this year with more of a bearish lean on the equities because of valuations, because of fundamental reasons for being bearish, and that has contributed to some of our performance this year. Positions can be changed at any given time, however, so even if we're wrong on that slight bearish tilt, we're always 50% long stocks and part of the mutual fund right and we can take off the short position when and if it's appropriate. But we have other positions. We're currently short coffee, and we're short coffee because of an increase in supply from harvests in parts of Brazil and because of favorable weather patterns.

Speaker 1:

Again, there's fundamental reasons for prices of certain commodities to to move Um, so we don't rely on just one theme. We'll have three to six different themes, uh in the portfolio at any given time, um, in the futures portfolio at any given time, and be actively managing that, and risk management is a key part of that. You know we will not always be correct, nobody will right, but by managing the risks for when we're wrong and cutting those losses short and letting our winners run, that's how money is made in the long run and that's how we've done it. So I would encourage investors and advisors to check out our website, read our monthly updates, reach out to us. Again, we'd like to make them very readable, which sounds silly to say, but we've all read plenty of white paper that when you have insomnia, it helps put you to sleep. We try to make ours more enjoyable, informative and understandable for everybody. So, but being that active and tactical and you know, is a core component.

Speaker 2:

Somebody on YouTube who came in late. Is this a growth fund or an income fund? We should think about that.

Speaker 1:

I know everyone likes to think of things in terms of categories boxes half US equities, half global macro futures, targeting total positive absolute return, and because the futures give us efficiency, we don't need 50% of the portfolio to get 50% exposure to the global macro future strategy that we invest in, which means we have excess cash that is really sitting in T-bills. So sometimes we'll talk about it as we're 50% equities, 50% global macro future strategy and maybe 30 to 35%, and maybe 30 to 35%, maybe more, in T-bills, earning T-bill interest. Right, which has been very favorable to us, but we don't target a dividend. There could very well be distributions at the end of the year because it's a mutual fund that certainly reinvest, but I wouldn't call it an income fund per se, even though it could generate some income for investors.

Speaker 2:

I always think about things in terms of diversifiers to each other. So alternatives to alternatives. How does it stack up against other non-correlated types of strategies or asset classes? You've seen.

Speaker 1:

Great question. Yeah, and I love that term alternatives to alternatives, because we don't think you know, you should just have one alternative, right? So, again, this is it goes into why why we decided to launch this mutual fund. Because we are non-correlated we are a diversifier to stocks, to bonds, to real estate, to managed futures trend following investments, to arbitrage strategies, to buffered investments, which are very popular. We're non-correlated historically to all of those, Through all of those, and the reason is and I like to again identify that there's a causation for that non-correlation, right?

Speaker 1:

If you can't identify the cause for something, in the back of my head I would always wonder is it happenstance, right? Is it just? It just happened to be non-correlated this time? But when that bus hits us, are we going to be correlated, right? They always say what's the phrase? Correlations move to one during times of stress or crashes, right, and that's what you saw in 2022, right, when stocks and bonds all went down, and you've seen it in other times in the past. But if there's a causation again, think of our coffee trade. If there's an increase in supply of coffee because the harvest is going to be bigger, because the weather pattern is favorable, and if demand doesn't change. Think back to basic economics supply and demand curves. If supply goes up and demand stays the same, prices fall down, and vice versa. So that's a identifiable logical reason.

Speaker 1:

And that thesis would turn out to be false. Right, there's no guarantees, and that's why we have multiple types of positions in the portfolio at any given time. And but that thesis will hold. Whether there's global pandemic, whether there's other variables that may impact. If stock equity valuations are too high and the market is priced to perfection, who cares? People are still going to drink their coffee. And if there's an oversupply, prices go down. The thesis holds true. Same thing with other theses that we have in the portfolio or we would have in the past.

Speaker 1:

But long term, our thesis on copper is global growth in China and other parts of the world are increasing the demand for electricity. You think of electric vehicles in this country and in China and in others. You know. You think of artificial intelligence. You know it's kind of amazing how much electricity is required to run all these AI chips, right, Even the new ones that are, you know, potentially more energy efficient. All that means is they're going to pop even more of them into the computers to be even more powerful, the, the. I. I saw a statistic actually I think chat gpt gave me this statistic um that said there's going to be uh over the next 10 years. They need to build um 10 uh nuclear power plants every year just to meet the requirement of artificial. And this is worldwide um uh 10 nuclear power plants every year to to provide the electricity needed for um artificial intelligence. So that's 100 in the next 10 years. Obviously, in the united states we've not been building them and china's been building a lot of nuclear power plants.

Speaker 1:

And in the name of our fund is the Dynamic Alpha Macro Fund, which means you know dynamic, we're flexible, alpha, we're shooting for alpha positive, you know better than market returns and macro big picture. Right, we're not picking a winner in saying this nuclear company is going to do better than this one or this EV company is going to do better than this EV company. It's just a macro thing. Who cares which one wins? They're all going to need copper. So in the future we could very well have a long position in copper.

Speaker 1:

We don't currently, because of a number of reasons. We do use technical analysis to look at price trends and price valuation of it. So we're not just going to haphazardly buy it because you got to buy it at the right price. You know you got to buy it at the right price, um, but to me that's how I think of alternatives is identifying what is the driver of the return for that alternative.

Speaker 1:

Don't just say, oh, real estate's an alternative, um, you know, because it's labeled as an alternative, and nothing wrong with real estate investing. But last time I checked, people do need jobs in order to pay the rent and buy houses and for house prices to go up, people need to have jobs. So normally, for a strong real estate market, you have to have strong economic growth. So if we don't, then could the real estate market be impacted Most likely, right? And could the real estate market be impacted Most likely, right? So identifying what is that driver of return to us is a key component of understanding alternatives and alternatives to alternatives and just building a truly diversified portfolio. Right, If you only have stocks and bonds, I would argue you're not diversified. Right, If you follow a 60-40 approach and we like 60-40. 60-40 is part of our multidimensional model, right, but it's not the model, right, Our multidimensional model. You can think of it as having multiple models in one, having a 60-40,. Having a quant tactical, having a fundamental global, having arbitrage long short strategies in one cohesive model.

Speaker 2:

Yeah, no, I think that's very well explained. For those, Brad, who want to learn more about the fund or maybe want to reach out to you to learn more, how should people go about that?

Speaker 1:

Yeah, so, um, dynamic wgcom is our main website. It's easy one, easy one to remember. You can also go to dynamic alpha fundscom. I am very active on linkedin. I try to post a video every week on linkedin, a short five minute video on market thoughts, financial planning thoughts, various things like that. You can certainly email us. You can email me directly at brad at dynamicwgcom. If you're a financial advisor, happy to provide information on our multidimensional models, on our mutual fund, if you're an investor, also happy to address any questions on what we do, uh, and if you want to be put in contact with uh, you know a good financial advisor, qualified financial advisor, uh, let us know. It's not our business, but we work with some amazing advisors, just like you, michael. You work with some amazing advisors and uh yeah, I appreciate those that watch this slide.

Speaker 2:

Hopefully I'll see you all on the next episode. Uh, be fan of Alternative so we could be in a more difficult cycle going forward. So, thank you, brian, I appreciate it. Thanks, michael Cheers.

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Michael A. Gayed, CFA

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