Key Takeaways
- • Katy Kaminski argues on the Top Traders Unplugged podcast (Episode 422, dated 17 October 2026) that geopolitical risk and structural inflation may be weakening the traditional assumption that bonds reliably diversify portfolios.
- • Kaminski revisits her Copenhagen presentation on crisis alpha, contending that rules-based strategies such as trend following can adapt more readily than static allocations when inflation becomes the dominant risk.
- • The episode highlights research, including new work from Quantica, showing that investors often fail to capture the full benefit of trend following, with a small number of months driving much of the strategy's long-term return.
- • Discussion covers the trade-offs between commodities and trend following as inflation protection, and how institutions can structure portfolios to make it easier for investors to stay invested.
Summary
In Episode 422 of Top Traders Unplugged, released 17 October 2026, host Niels Kaastrup-Larsen and guest Katy Kaminski examine why geopolitical risk and structural inflation may be altering the assumptions underpinning traditional portfolios. The episode centers on Kaminski's recent Copenhagen presentation on crisis alpha, in which she explains that bonds can lose their diversification benefits when inflation becomes the dominant risk factor. Rules-based strategies, by contrast, can adapt more easily as market regimes shift.
The conversation addresses research on preparing portfolios for different inflation regimes, and weighs the trade-offs between commodities and trend following as sources of inflation protection. The discussion also draws on new work from Quantica examining why investors do not always capture the full benefit of trend following, a gap the episode attributes largely to poor timing of liquid alternatives.
A central takeaway is that a small number of months account for a disproportionate share of trend's long-term return. Kaminski and Kaastrup-Larsen conclude that patience and thoughtful portfolio design are therefore critical, and the episode touches on how institutions can make it easier for investors to remain invested, as well as whether packaging trend with other assets can address the problem. The episode also contrasts the 2026 environment with 2022 for trend followers.
The conversation addresses research on preparing portfolios for different inflation regimes, and weighs the trade-offs between commodities and trend following as sources of inflation protection. The discussion also draws on new work from Quantica examining why investors do not always capture the full benefit of trend following, a gap the episode attributes largely to poor timing of liquid alternatives.
A central takeaway is that a small number of months account for a disproportionate share of trend's long-term return. Kaminski and Kaastrup-Larsen conclude that patience and thoughtful portfolio design are therefore critical, and the episode touches on how institutions can make it easier for investors to remain invested, as well as whether packaging trend with other assets can address the problem. The episode also contrasts the 2026 environment with 2022 for trend followers.
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