Diversifying You Portfolio with Digital Assets
“We wanted the audience to understand where the idea of blockchain is coming from and why people are excited about it because we believe this is going to be part of your portfolio in a few years.”
Brian Walls is co-founder and Managing Partner of Bridge Alternatives, an independent brokerage firm that advocates for the inclusion of alternative investments in an institutional investor’s portfolio. He spearheaded the development of the Bridge Alternatives Futures Index and was key in the creation of the Time Summit. With the Time Summit right around the corner, we sat down with Brian to learn more about the annual gathering, his thoughts on digital assets and how institutional investors are accepting crypto-related strategies.
While the initial Time Summit originated at Carr Futures, Brian’s team at Bridge Alternatives manages the gathering now.
“Our team has been hosting conferences since 2002. We pull together investors and managers in a research oriented and content focused environment,” said Brian. “We are an intimate crowd and we aim to make it productive for chief portfolio managers to meet with lead analysts.”
This year Brian and his team are organizing the Time Summit at Pinehurst Resort in North Carolina from April 29-May 1, 2019.
“We moved it to Pinehurst to create that retreat feeling. We have about 15 different presenters and about 100 attendees, which will make for good dialogue,” said Brian. “This is a content focused event with a good following.”
He explained that the majority of the agenda is dedicated to research presentations, as the team is careful not to allow people to pitch their firms. Some of the topics that that will be discussed this year include; Managed Futures, Macro Investing, Commodities, Digital Assets, Behavioral Science, Machine Learning and Statistics.
“We have held sessions on portfolio construction and behavior biases in years past,” said Brian. “A few years ago, Nobel Peace Prize Winner Daniel Kahneman kicked off the conference. We had asked some of the top portfolio managers to talk about how they incorporated Professor Kahneman’s work into their strategies and he was sitting in the front row for all the presentations. They all said that was pretty unnerving watching him take notes.”
This year follows the same behavioral sciences theme.
“David Dunning from the University of Michigan, will be speaking this year on what is known as the Dunning-Kruger effect,” Brian said.
The Dunning-Kruger effect is a cognitive bias known in psychology for when people mistakenly assess their cognitive ability as greater than it is. It is related to the cognitive bias of illusory superiority and comes from the inability of people to recognize their lack of ability.
“Not only are people overconfident who don’t have the expertise but the people who do have the expertise are humble about it,” said Brian. “The things that seem quite simple need a lot of expertise to do it well.”
At this year’s gathering, Will Peets from Passport Digital Holdings will talk about the overall health of the crypto industry and the continued development of new and existing projects in the digital assets space.
“We have some sessions on crypto this year but more last year,” said Brian. “We had Kyle Samani from Multicoin Capital, Olaf Carlson Wee from Polychain Capital, and Ari Paul from BlockTower Capital take the educational approach.”
While Brian believes digital assets are coming, he said that they are early in gestation.
“The institutional investors are still trying to provide well-developed investment strategies so the idea of a new asset class is hard to wrap their head around,” said Brian. “This is a fairly conservative crowd.”
Brian said that about a quarter of last year’s attendees wanted to pursue ideas on digital assets.
“It was received with some healthy skepticism,” he said. “This makes us believe we are earlier in the curve than we originally thought.”
Brian’s’ background is in the futures brokerage business. He joined Dean Witter in 1990 where he founded the firm’s Alternative Investments Group. He has worked at Carr Futures, Calyon Financial and Newedge before eventually evolving into the Global Head of Prime Services Division at Societe Generale.
He has worked with industry pioneers such as Galen Burghardt to include CTA’s and Managed Futures strategies into investment portfolios.
In 2016, Brian cofounded Bridge Alternatives to focus on providing advisory, capital introduction, index development and research events within the alternative investments space.
“Bridge Alternatives is somewhat of a catch-all company,” he said. “We have a wide breadth of business which includes quantitative macro markets, commodities, energy and agriculture.”
And digital assets.
“We are interested in crypto and digital assets. It’s something we track because we think it’s going to be big.”
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