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78 If You Believe In Your Models, Never Deviate From Them with Kim Bang of Prolific Capital Markets – 2of2

“If you really believe in what you’re doing – you should not be de-levering in a drawdown.” – Kim Bang (Tweet)

In our second part of this conversation, we dive into the details of the program that Kim runs. We discuss why it’s important to stick with your models, even in times of severe drawdowns, and how Kim views risk. He also talks about the books and people that have inspired him in his career.

Thanks for listening and please welcome back Kim Bang.

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In This Episode, You’ll Learn:

  • The details behind the program Kim runs.

    “I think there’s a direct correlation between the simpler a model is, the more robust it is.” – Kim Bang (Tweet)

  • What he feels about larger drawdowns.

    “If you believe in your models, never ever deviate from them.” – Kim Bang (Tweet)

  • What kind of indicators goes into the models that he uses.

    “We are probably out of the markets about a third of the time.” – Kim Bang (Tweet)

  • Why he uses a non-cyclical approach to creating trading models.
  • How he looks at volatility.
  • What kind of mean reversion strategies he uses.
  • How he responded to the Swiss Franc move.

    “In general – these are the kinds of events that we live for.” – Kim Bang (Tweet)

  • How Kim quantifies risk.
  • How do you prepare for a drawdown when you haven’t gone through a significant one?
  • How his firm comes up with new ideas and goes about doing research.
  • The positives and challenges with working as a father and son team in the same firm.
  • How he knows when a model has stopped working.
  • What he is doing to launch his first fund.

    “We have an inverse problem, where it’s costing us to keep money in cash.” – Kim Bang (Tweet)

  • What questions investors should be asking in due diligence conversations with him.

    “Most of the conversations we’ve had so far are with these early adopters, and they are very savvy.” – Kim Bang (Tweet)

  • What books have impacted Kim’s career.
  • How he sees the firm in the future.

Resources & Links Mentioned in this Episode:

Books that have influenced Kim include Market Wizards, The Quants, and books by Ralph Vince.

Learn more about people who have inspired Kim, including Roy Niederhoffer, Welles Wilder, and John Henry.

This episode was sponsored by Swiss Financial Services:

Connect with Prolific Capital Markets:

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Follow Kim Bang on Linkedin

“If you want to be in this space at the cutting edge and you want to compete, you have to be somewhat original. Not completely from scratch, but somewhat original in the way you extract earnings.” – Kim Bang (Tweet)