SI413: Why Trend Following Is More Than Crisis Alpha ft. Andrew Beer & Tom Wrobel

**SPEAKER_1** (0:01)
Welcome to Top Traders Unplugged. In markets, success doesn't come from predicting what happens next. It comes from being prepared for what you can't predict.
In each episode, we go deep with some of the world's most thoughtful minds in investing, economics and beyond to understand how they think, how they prepare and how they decide, and the experiences that shaped how they see the world. No noise, no shortcuts, just real conversations to help you think better and invest with confidence.

**Niels Kaastrup-Larsen** (0:39)
Welcome and welcome back to this week's edition of the Systematic Investors series with Andrew Beer and Tom Wrobel, as well as myself, Niels Kaastrup-Larsen, where we each week take the pulse of the global market through the lens of a rules-based investor. Andrew and Tom, it is great to have you both back this week on the podcast. Tom, it's been a little while. How are you doing?

**Tom Wrobel** (1:00)
Thanks, Niels. Yes, very well here. We're in Eclipse Mania in London. We've had the solar eclipse, which has been very exciting.

**Niels Kaastrup-Larsen** (1:09)
Yeah. Well, let me talk to you about that as well. Andrew, how are you? And did you see the eclipse? Because I missed it completely because of clouds over here.

**Andrew Beer** (1:18)
I missed it completely, but we also didn't get it over here. It kind of arced from, I guess, sort of the Nordics down through, down the kind of hit Madrid. My sister did fly to Iceland to see it though, with her daughter, and then had a perfectly cloudy day. So, I think.
But all things are great, and thank you very much for having me back.

**Niels Kaastrup-Larsen** (1:42)
Of course. Absolutely. Tom, so did you actually see, because I was looking at it, and so here where I am at the moment in Denmark, they said, oh, it's going to be 7 o'clock, and then they said 8 o'clock, and I was obviously not watching directly into the sun. I really didn't see any signs of it, but...

**Tom Wrobel** (1:59)
Yeah.
Well, we had about 95% here in the UK, which was pretty amazing. But interestingly, if you weren't looking at it through a sort of a safety glass or goggle, it was almost unobservable because the sun did get a lot dimmer, but it still was evening time, so the sun was going down anyway. However, we had some goggles and it was really amazing here.

**Niels Kaastrup-Larsen** (2:23)
Okay. Wow. Okay. Well, next time I'll buy the goggles. That's for sure.
Anyways, we've got a really good lineup of topics. Thanks so much for sending them over. We got a question that came in as well, so lots of things to dig into. But as usual, before we get into any of that, let me ask you, Tom, what has been on your sort of outside the topics we're going to be discussing? Anything that you've sort of found interesting or caught your attention in the last few weeks?

**Tom Wrobel** (2:56)
I think it's really been volatility.
It's like the markets have almost forgotten about volatility and where we're going and the geopolitics that is going on. I think I feel like we're in a new normal where prices have now digested the volatility in Iran war. And it's almost like equities are off again. And here come the next big major trends.

**Niels Kaastrup-Larsen** (3:22)
Yeah, I mean, that is true. Although there has been a little bit of volatility. It's just that net-net it's been up and down and not really going anywhere. What about you, Andrew?
I know you said you were heading for the... Last time we spoke, you said, I'm heading for the mountains. I'm going to relax. Have you succeeded in relaxing?

**Andrew Beer** (3:43)
Uncharacteristically, I have. I had been trying to tune out a lot of things that have been going on. I guess one observation back to what Tom was saying is that, I started my career in the hedge fund space working for a die-hard value investor.
Before that, I've been an investment banker and I worked briefly at an LBO firm. I don't know how you conduct any kind of normal traditional valuation analysis in this world right now. I've used this metaphor that I think the equity markets have just become, they used to have venture capital, Cathie Wood arc, these pie-in-the-sky things where God knows what's going to happen five or seven years out. But if you added up everybody's projections of what was going to happen five to seven years out, everybody would have these huge monstrous companies. But the reality of venture capital is that you get one or two winners, and then it's a killing field for everybody else. It feels like the equity markets today, they're so strange that you have a SpaceX IPO that's talking about things that are a company of that scale that are so fantastical.