Podcast | Macro Hive Conversations With Bilal Hafeez

Corey Hoffstein On How The Fed, Passive Investors And HFT Create Liquidity Cascades

Macro Hive
Finance, Economics, FX, G7, Investment Strategies, Macro

Corey recently wrote an excellent piece on market liquidity and I had to have him as a guest. For background, he is co-founder and Chief Investment Officer of Newfound Research, a quantitative tactical asset management firm. At Newfound, he is responsible for portfolio management, investment research, strategy development, and communication of the firm’s views to clients. He holds a Master of Science in Computational Finance from Carnegie Mellon University. In this podcast we discuss:

  1. How central banks have pushed investors up the risk curve
  2. How central banks have introduced moral hazard to investors
  3. The importance of passive investing as marginal flow into assets
  4. The impact of passive on how trades are executed
  5. The procyclicality of HFT liquidity provision
  6. How dealers hedging magnifies volatility shifts
  7. The prevalence of volatility contingent strategies in markets
  8. When do liquidity cascades end
  9. How to position of liquidity cascades
  10. Books that influenced Corey: Fooled by Randomness (Nassim Taleb) and Red-Blooded Risk (Aaron Brown)

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