#116 - Sarah Ketterer - Without a Quant Risk Model, I'd Argue an Investment Manager is Completely Blind

48 minutes

In Episode 116, we welcome entrepreneur, CEO, and fund manager, Sarah Ketterer. Meb dives right in, asking about a quote on Causeway’s website which references how the shop blends fundamental and quant analysis. Sarah gives us her approach, which details how the fundamental and quant approaches work together, supporting one another.

Meb pushes for more details. What’s Causeway’s actual process? Does it begin with a quant screen then an analyst takes over, or the other way around?

Sarah tells us it depends on the client. She provides more details, but her feelings about the importance of a quant approach really comes through when she tells us “without a quant risk model, I’d argue an investment manager is completely blind”.

Next, Meb brings up value, and asks what role it plays in Sarah’s approach, and how she sees value today.

Sarah tell us that every strategy Causeway manages has a value emphasis to some degree. The more fundamental, the heavier the value exposure. And the quant-focused funds also have value, but those use momentum as well. This dovetails into a discussion of how not all clients want to sit through deep value cycles. They want returns now, not on a rolling 3-5-year basis. But a great value manager has to think in that time frame. Sarah notes how investors have to be patient with a value approach, yet human nature is not inherently patient.

This bleeds into a discussion of cheap countries and career risk, and the gap between value and growth – Sarah tells us this gap has reached extreme levels. Meb asks about the opportunities she’s seeing. Sarah notes how the opportunities depend on the amount of risk you want to take. For instance, she can find you a good Turkish bank right now, but do you want that level of risk exposure?

There’s way more in this episode – some opportunistic finds in Britain… Why Sarah is “wildly bullish” on China… Sarah’s view on the biggest mistakes investors make regarding risk… And, of course, her most memorable trade.

All this and more in Episode 116.

More episodes from The Meb Faber Show

#311 – Radio Show – Valuation Update…Bond Returns….Meb’s Startup Investing

Episode 311 has a radio show format. We cover a variety of topics, including: · The importance of having an investment plan · Valuations update · How Meb approaches startup investing · …

#310 – Kathryn Kaminski, AlphaSimplex - When You’re A Systematic Investor, Your Process Makes The Decision

In episode 310, we welcome our guest, Kathryn Kaminski, Chief Research Strategist at AlphaSimplex, where she’s also the co-portfolio manager for the …

#309 – Andrew Horowitz, Horowitz & Company - I Think We’re Starting To See A Little Bit Of What Happens When The Tide Goes Out

In episode 309, we welcome our guest Andrew Horowitz, President and Founder of Horowitz & Company and host of The Disciplined Investor Podcast.    In today’s episode, we start with …

#308 – Best Idea Show – Maciej Wojtal, Amtelon Capital – I Saw Iran As Potentially The Biggest Transformational Opportunity Since Russia

In episode 308, we welcome our guest, Maciej Wojtal, founder and CIO of Amtelon Capital, an investment fund focused on Iranian equities. In today's episode, we're covering Maciej’s best …

#307 – Vikram Mansharamani, Harvard Lecturer and Author - In All Bubbles, You Usually Have A ‘This Time It’s Different’ Story

In episode 307, we welcome our guest, Vikram Mansharamani, a Harvard lecturer, author, and global trend spotter who shows people how to anticipate the future, manage risk, and spot …

#306 – Jeff Seder, EQB - We Ended Up The First Triple-Crown Winner in 37 Years

In episode 306, we welcome our guest, Jeff Seder, founder of EQB, a high-tech sports medicine startup that consults with the majority of the major …

How you can listen to this podcast

You can listen to episodes right here on the website, or if you prefer, in a podcast app. Listening in an app makes it easier to keep track of what you’ve already heard, listen without using your data plan and many other conveniences.

Recommended apps
Start listening to #125 - Tom Barton - The Biggest Problem Investors Have is Things Change...and They Don't Change
1:24:56
Start listening to #125 - Tom Barton - The Biggest Problem Investors Have is Things Change...and They Don't Change
1:24:56