In partnership with:
CME Group

Why Optimism is Important | Dave Sanderson, KFL Capital Management | #50

Top Traders Unplugged with Dave Sanderson and Niels Kaastrup Larsen

“The best way to manage risk is to spend less money.” – Dave Sanderson (Tweet)

Welcome to Part 2 of our conversation with Dave Sanderson. In this episode we explore his trading program in detail, from the markets the firm trades to how they describe their program to investors. We also explore the challenges that he goes through as a business leader, dealing with drawdowns, and why optimism is so important to Dave.

Thanks for listening and enjoy the second part of our conversation with Dave Sanderson.

Subscribe on:

Subscribe in iTunes Subscribe on Stitcher Subscribe on Soundcloud

In This Episode, You’ll Learn:

  • Why Dave believes that QIM is a unique firm in a reasonably similar category as KFL Capital Management.
  • How to describe Krystal to investors and why it can be a challenge.
  • About the length of time it takes for Krystal to compute the data and make a decision.

    “It used to take six weeks to run that [data computation]. Now it takes about a minute.” – Dave Sanderson (Tweet)

  • Why the breakthroughs in computational power are supporting KFL Capital Management to make their systems faster each year.

    “The mathematical space is so big, it’s like searching the size of the Internet every time we make a prediction.” – Dave Sanderson (Tweet)

  • The markets KFL trades.
  • Expected drawdown and volatility Krystal expects.

    “What gives me comfort is the fact that we’re agnostic in terms of direction.” – Dave Sanderson (Tweet)

  • How Dave expects to deal with drawdown environments.
  • Research cycles within KFL Capital Management and the potential for a second Krystal.

    “Research is non-linear.” – Dave Sanderson (Tweet)

  • About the 99.3% match rate between their live trading and back testing results.
  • The biggest challenge for KFL Capital Management in today’s market.
  • About the challenge of attracting AUM in the modern financial landscape.
  • Asymmetry of agency and understanding how to focus on who you’re talking to.
  • Regarding the difficulties of explaining machine learning and big data ideas.
  • Commonalities in the highest level due diligence explorers.
  • Entrepreneurial perspective, great books and an open minded perspective on failures.
  • Why optimism is such a powerful force in today’s world.

Resources & Links Mentioned in this Episode:

This episode was sponsored by Swiss Financial Services:

Connect with KFL Capital Management:

Visit the Website:

Call KFL Capital Management: +1 (416) 849-1925 x212

E-Mail KFL Capital Management:

Follow KFL Capital Management on Linkedin

“I think the great experiences go to the optimists because in life you probably find what you’re looking for and the optimists tend to look for great things and expect great things.” – Dave Sanderson (Tweet)


  1. Fred on 12/07/2014 at 3:13 PM

    Machine learning trading is a topic that should be on every systematic trader’s radar. This was an interesting interview and what I liked in particular was the questions. As the interview proceeded, I would think of a question that I would ask Dave if I was conducting the interview and almost every time Niels would ask the question.

    Without doubt other firms are working on employing machine learning for trading purposes but not many are talking about their live models. KFL’s fund is up roughly 30% in its first year so they just may be one of the companies employing this trading technology to watch going forward.

    • Niels Kaastrup-Larsen on 12/08/2014 at 1:52 AM

      Thank you very much for your kind comments. Dave was a great guest and someone to watch!

  2. Jake on 12/14/2014 at 8:08 PM

    I love the way Dave talked about pitching which he said he got from Meyler Capital(?). At the end of a big pitch, asking if someone is willing to follow your story is a lot easier to get a yes to than are you all in or willing to buy which some times do need some gestation time.

    • Niels Kaastrup-Larsen on 12/14/2014 at 10:18 PM

      Thank you Jake for you comment…I’m sure Dave will appreciate it!

Leave a Comment