The Best Offense: When Defensive Strategies Win

S&P Dow Jones Indices is out with a piece of research that highlight the regime conditional benefit of Low Volatility investing.

Understanding any investment strategy requires us to understand how its success is driven by the market regime in which it operates.

Strategies that overweight high beta stocks, e.g., will tend to look good in strong markets and bad in weak markets. Defensive strategies like low volatility or high yield will display the opposite pattern.

Epsilon Theory: It's Not About the Nail

Do, or do not. There is no try.”

– Yoda, “Star Wars: Episode V - The Empire Strikes Back” (1980)

I see it all perfectly; there are two possible situations - one can either do this or that. My honest opinion and my friendly advice is this: do it or do not do it - you will regret both.
– Soren Kierkegaard, "Either/Or: A Fragment of Life" (1843)

Epsilon Theory: Why Take a Chance?

Vinny Forlano:          He won't talk. Stone is a good kid. Stand-up guy, just like his old man. That's the way I see it.

Vincent Borelli:        I agree. He's solid. An effin' Marine.

Americo Capelli:      He's okay. He always was. Remo, what do you think?

Remo Gaggi:              Look... why take a chance? At least, that's the way I feel about it.

Epsilon Theory: The Clash of Civilizations

Thomas Cole, “The Course of Empire: Destruction” (1836)

In the emerging world of ethnic conflict and civilizational clash, Western belief in the universality of Western culture suffers three problems: it is false; it is immoral; and it is dangerous.
– Samuel P. Huntington, “The Clash of Civilizations and the Remaking of World Order” (1996)


Subscribe to RSS - blogs