Cambrian Asset Management

To highlight National Book Month and celebrate the joy and knowledge books can bring into our lives, the team at Cambrian has put together the following list of our top 7 recommendations: 𝘼 𝙈𝙖𝙣 𝙁𝙤𝙧 𝘼𝙡𝙡 𝙈𝙖𝙧𝙠𝙚𝙩𝙨 𝙗𝙮 𝙀𝙙 𝙏𝙝𝙤𝙧𝙥𝙚 - A memoir by the “godfather of quant investing” with insights into the power of mathematical and probabilistic thinking, 𝘽𝙚𝙣 𝙂𝙧𝙖𝙝𝙖𝙢 𝙬𝙖𝙨 𝙖 𝙌𝙪𝙖𝙣𝙩: 𝙍𝙖𝙞𝙨𝙞𝙣𝙜 𝙩𝙝𝙚 𝙄𝙌 𝙤𝙛 𝙩𝙝𝙚 𝙄𝙣𝙩𝙚𝙡𝙡𝙞𝙜𝙚𝙣𝙩 𝙄𝙣𝙫𝙚𝙨𝙩𝙤𝙧 𝙗𝙮 𝙎𝙩𝙚𝙫𝙚𝙣 𝙋. 𝙂𝙧𝙚𝙞𝙣𝙚𝙧 - Demystifies quant/rules-based investing and applies Graham’s principles to quantitative methods. 𝙀𝙣𝙜𝙞𝙣𝙚𝙚𝙧𝙞𝙣𝙜 𝙈𝙖𝙣𝙖𝙜𝙚𝙢𝙚𝙣𝙩 𝙛𝙤𝙧 𝙩𝙝𝙚 𝙍𝙚𝙨𝙩 𝙤𝙛 𝙐𝙨 𝙗𝙮 𝙎𝙖𝙧𝙖𝙝 𝘿𝙧𝙖𝙨𝙣𝙚𝙧 - A practical guide for engineering managers, covering team leadership, communication, and technical management challenges. 𝙍𝙚𝙞𝙣𝙛𝙤𝙧𝙘𝙚𝙢𝙚𝙣𝙩 𝙇𝙚𝙖𝙧𝙣𝙞𝙣𝙜 𝙗𝙮 𝙍𝙞𝙘𝙝𝙖𝙧𝙙 𝙎𝙪𝙩𝙩𝙤𝙣 & 𝘼𝙣𝙙𝙧𝙚𝙬 𝘽𝙖𝙧𝙩𝙤 - A foundational textbook in reinforcement learning. 𝙎𝙪𝙥𝙚𝙧𝙛𝙤𝙧𝙚𝙘𝙖𝙨𝙩𝙞𝙣𝙜: 𝙏𝙝𝙚 𝘼𝙧𝙩 𝙖𝙣𝙙 𝙎𝙘𝙞𝙚𝙣𝙘𝙚 𝙤𝙛 𝙋𝙧𝙚𝙙𝙞𝙘𝙩𝙞𝙤𝙣 𝙗𝙮 𝙋𝙝𝙞𝙡𝙞𝙥 𝙏𝙚𝙩𝙡𝙤𝙘𝙠 𝙖𝙣𝙙 𝘿𝙖𝙣 𝙂𝙖𝙧𝙙𝙣𝙚𝙧 - Explores how ordinary people can make accurate predictions and techniques to improve forecasting abilities. 𝙏𝙝𝙚 𝘼𝙧𝙩 𝙤𝙛 𝘿𝙤𝙞𝙣𝙜 𝙎𝙘𝙞𝙚𝙣𝙘𝙚 𝙖𝙣𝙙 𝙀𝙣𝙜𝙞𝙣𝙚𝙚𝙧𝙞𝙣𝙜: 𝙇𝙚𝙖𝙧𝙣𝙞𝙣𝙜 𝙩𝙤 𝙇𝙚𝙖𝙧𝙣 𝙗𝙮 𝙍𝙞𝙘𝙝𝙖𝙧𝙙 𝙃𝙖𝙢𝙢𝙞𝙣𝙜 - Inspiring stories of people doing amazing things, Shannon’s information theory, Einstein’s theory of relativity, Grace Hopper, Kaiser, and more. 𝙏𝙝𝙚 𝙈𝙖𝙣 𝙒𝙝𝙤 𝙎𝙤𝙡𝙫𝙚𝙙 𝙩𝙝𝙚 𝙈𝙖𝙧𝙠𝙚𝙩 𝙗𝙮 𝙂𝙧𝙚𝙜 𝙕𝙪𝙘𝙠𝙚𝙧𝙢𝙖𝙣 - A biography of Jim Simons and Rentec, the most successful investment firm ever (by returns), also a quantitative trading firm. #NationalBookMonth #QuantTrading

September 2024 Market Commentary At first glance, the market returns for September seem to imply a changed market environment, especially once the markets began to fully anticipate the 50 bp Fed rate cut on September 18th. However, the reality is that September was an extension of July and August’s choppy conditions. The first six days of the month were characterized by a significant sell-off, leading to BTC and ETH intra-month losses of 11% and 14%, respectively. A significant rally ensued, only to fizzle out and end with another sell-off by the month’s end. #AssetMaintenance #Crypto

This is a teaser for a fascinating and candid Fireside Chat with Anthony Scaramucci of Skybridge and SALT fame. It is full of personal and colorful insights as to the politics around crypto and why it could play such an important part in the upcoming Presidential election. He also discusses why he is so optimistic about the medium term prospects for constructive bipartisan regulation and how Wall Street may ultimately be a significant catalyst for investment adoption. 

August 2024 Market Commentary: August was a continuation of a difficult market environment. Digital asset markets were very weak early in the month, with BTC falling as low as $49k and ETH $2,100, declines of 24% and 35%, respectively. BTC bounced back quickly, rallying nearly 30% over three days only to chop up and down double-digit percentages repeatedly thereafter, closing the month down 9%. ETH did not recover quite as well from the initial drawdown (+15% over 10 days), but faced similar double-digit percent choppiness as BTC through the rest of the month, closing down 22%.  #AssetManagement #Crypto

July 2024 Market Commentary Whilst the market environment in July felt slightly different to previous months in that it displayed more elements of “directionality” vs “choppiness,” it continued to be subject to significant swings. Early in July, BTC fell sharply by ~15% to what would be its low for the month at just under $54k, driven by reported sales of German government seized BTC. The price then recovered and made its way to its month high, almost touching $70k, a nearly 30% swing, before selling off ~7% into the month-end. ETH exhibited more choppiness around the ETF launch, diverging from BTC, and ended the month down ~6%. In the meantime, there was plenty of encouraging newsflow in the immediate background. The launch of eight ETH ETFs, whilst underwhelming in terms of price action, is another stamp of regulatory support for the industry. Furthermore, as the presidential election cycle continued to take twists and turns, there were increasingly supportive statements made by the leading candidates further contributing to the sense that regulatory headwinds are abating somewhat. Since month end there has been a significant sell off in risk assets, to which digital markets were not immune. BTC fell as much as 25%, ETH as much as 33%. Notwithstanding an overall constructive outlook, the need for risk management remains paramount. #AssetManagement #Crypto

This is a teaser for a fascinating and wide ranging discussion with Cambrian investor Howard Morgan, co-founder of Renaissance Technologies and First Round Capital. Amongst many other topics he describes the origin of the VC investing arm at Renaissance Technologies and the initial challenges of attracting institutional investor for what was at the time (in a similar way to digital assets today) an embryonic asset class. It was an inspiration to have a conversation with such a long standing entrepreneurial and successful investor. 

June 2024 Market Commentary: June extended the period of difficult market conditions that has dominated since March. Although the performance of BTC has been directionally down since briefly topping $73,000 in Mid-March, its trajectory has been characterized by regular sharp rallies that tend to fade. It is important to highlight that periods of choppy performance are not entirely unexpected after such strong price action. From mid-October 2023 to mid-March 2024, BTC’s price increased ~175%. Following such a move, it is not surprising that we have experienced multiple months of choppiness and consolidation since then. These choppy periods of consolidation tend not to last too long and can often be followed by further strong directional moves.

Bitwise Head of Alpha Strategies and PM Jeffrey Park, CFA recently sat down with Cambrian Asset Management for a fireside chat on why institutions can’t ignore crypto anymore. (Spoiler alert: scale, liquidity, uncorrelated return profile.) (Full conversation available through Cambrian Asset Management.)