“You have to be an optimist in this business to survive, you have to bring an original point of view, why you want to do it in a certain way and you need to be able to explain to people in a way that makes sense to them why you are doing what you are doing”On today’s show I am talking to Tushar Chande, Co-Founder and Head of Research at Rho Asset Management. Tushar is also the author of a number of books on the topic of how to design rule based trading systems as well as having been actively trading these systems for more than 20 years. Thank you for visiting, now let's get to the interview with Tushar Chande.
In This Episode, You'll Learn:
- Why the random nature of the markets attracted Tushar to develop systems for trading these markets
- Background information on Rho Asset Management and it's philosophy
- How Tushar utilizes behaviors of discretionary traders to make estimates of conviction about their individual trades
- How Rho has designed it's Altius Program to offer meaningful protection when equity markets go down
"We try to automate all the immediate trading tasks and processes so that we can have tremendous control, consistency and disciplined action at all times."
- What to be aware of when exploring an Asset Manager's performance over a 20 year period
- Offense/Defense Ratio, What it means and How to use it to Measure the quality of systems design
"We've mostly gone with break out style systems as opposed to a moving average cross over type systems."
- How Rho's models have been designed in order to achieve the overall objective of the Program
- What Trend Following Indicators are used for and why
- Exploring the volatility of the equity curve
- The input data needed to run the the Altius Program, the time it takes and when they run the model
"The core advantage of having a CTA in your portfolio is to be able to offset significant declines in the equity and bond markets."
Resources & Links Mentioned in this Episode:Beyond Technical Analysis by Dr. Tushar Chande Learn about the Rho Trend Barometer: Hedge Fund Journal - Rho Trend Barometer Explained (PDF download)
"And all the rules are automated so in terms of day to day we don't really have to think because that's all taken care of"