Today Rusty & Robyn are joined by Paul Baiocchi, Chief ETF Strategist at SS&C ALPS Advisors in Denver, CO. Paul Baiocchi is the Chief ETF Strategist at SS&C ALPS Advisors, spearheading the firm’s distribution strategy and execution for the ETF suite as well as the Select Sector SPDRs lineup of ETFs. Paul works closely with the distribution, research and marketing teams to tailor the firm’s messaging and client-facing content for the varied needs of a range of investor types. In addition to providing subject matter expertise in client meetings, Paul supports the marketing and PR teams while also aiding the research efforts of SS&C ALPS Advisors and Select Sector SPDRs. Prior to joining the firm, Paul was Vice President of ETF Business Development at Fidelity Institutional Asset Management where he helped build and grow the firm’s ETF lineup for six years while developing sales and messaging strategies for sector investing. Previously, he worked at ETF.com, building an ETF analytics platform, writing about the ETF industry and moderating panels at Inside ETFs conferences. Paul has been in the financial services industry for 20 years. He is a CFA charter holder, holds an MBA from the University of British Columbia’s Sauder School of Business and a bachelor’s degree in Business Administration from California State University at Chico.

Key Takeaways

• [03:12] - Paul’s professional background and what led him to focus on ETFs, in particular.
• [07:04] - What is SS&C’s investment philosophy and how does it stand out as a firm?
• [10:40] - Paul’s overall outlook for the ETF industry moving forward.
• [14:42] - Where does Paul see innovation developing in the ETF industry moving forward?
• [16:20] - What are some of the obstacles to growth that Paul sees for ETFs going forward?
• [19:10] - SS&C ALPS offer more than 50 ETFs. Of this selection, where is Paul seeing the most growth and why does he think that is?
• [23:30] - Which of the aforementioned strategies are not seeing as much growth and why?
• [27:22] - Paul’s outlook on Active ETFs for 2024 and his thoughts on the evolution of Active ETFs as a category.
• [30:55] - What are some potential catalysts that might encourage Small Caps to start regularly outperforming?
• [34:48] - What are the risks of being in Small Cap indexing strategies, like the Russell 2000 or the S&P 600?
• [37:26] - What is Paul’s overall outlook on non-US stock markets, both in absolute and relative terms?
• [41:00] - What is currently Paul’s favorite investment idea?

Quotes

[15:42] - “There’s the ongoing sort of debate, and I have this debate myself, around tokenization of investment strategies [and] whether or not you can tokenize an asset class…Can you create a tokenized asset class of an ETF offering that allows you to provide that investment strategy in another format? That to me is another piece of innovation that might be 5 or 6 years down the road, or 10 years down the road, but is another driver of innovation as I see it.” ~ Paul Baiocchi

[26:12] - “Here we are in 2024, facing significant supply pressure on a number of key categories in the commodities space. We’re seeing energy prices start to bubble up again [and] we are also seeing weakness in specific commodities, namely natural gas…So the ability to be flexible in terms of what commodities you have exposure to, based on a really actionable model that the index uses to pick and choose among commodities, I think is a really compelling way to diversify an asset allocation, and we know historically that commodities can add a certain level of diversification to an asset allocation.” ~ Paul Baiocchi

Links

• Paul Baiocchi on LinkedIn
• SS&C ALPS Advisors
• “ATLiens” by Outkast

Connect with Us

• Meet Rusty Vanneman, Orion’s Chief Investment Officer
• Check Out All of Orion’s Podcasts
• Power Your Growth with Orion

Disclosure(s) - Orion Portfolio Solutions, LLC, an Orion Company, is a registered investment advisor.

1168-OPS-5/13/2024

Today Rusty & Robyn are joined by Harry Hartford, a Portfolio Manager at Causeway Capital Management in Los Angeles, CA. Mr. Hartford is the president at Causeway, fundamental portfolio manager, and head of fundamental research. Mr. Hartford co-founded the firm in June 2001 and is a member of the operating committee. From 1996 to June 2001, Mr. Hartford was a managing director for the Hotchkis & Wiley division of Merrill Lynch Investment Managers (HW-MLIM) and co-head of the firm’s HW-MLIM international and global value team. From 1994 to 1996, Mr. Hartford was a portfolio manager for Hotchkis and Wiley. From 1984 to 1994, Mr. Hartford was with The Investment Bank of Ireland, where he gained ten years’ experience in both international and global equity management. During this time, Mr. Hartford also managed the Irish Investment Fund, a closed-end country fund quoted on the NYSE. Before entering the investment business, Mr. Hartford lectured in micro and macroeconomics at Oklahoma State University. Mr. Hartford earned a BA, with honors, in economics from the University of Dublin, Trinity College, an MSc in economics from Oklahoma State University, and is a Phi Kappa Phi member. Mr. Hartford is a member of The Ireland Funds America Board of Directors.

Key Takeaways

• [03:46] - Harry's professional background and what drew him to the field of investment.
• [07:20] - What is Causeway’s investment philosophy and how does it differ from other international value managers?
• [09:27] - Which one of Causeway’s non-US value strategies is generating the most interest from end investors right now and why?
• [11:06] - Which of Causeway’s strategies does Harry think should be generating more investor interest in the current market environment?
• [12:08] - What is the argument for investing overseas, strategically, in a time where international markets have underperformed US Markets for several years?
• [13:50] - Is there a different argument for International Investing from a tactical standpoint?
• [15:31] - Potential catalysts that might cause the non-US markets to start to consistently outperform again.
• [19:52] - It seems like everyone is saying that the US Dollar is going to get stronger in the short term. What is Harry’s outlook on the US Dollar?
• [22:04] - What does Harry see ahead for International Small Cap stocks?
• [24:15] - What is Causeway’s “risk lens” model and how does it benefit their clients?

Quotes

[010:37] - “[Causeway Capital’s] Emerging Markets and International Small Cap strategies are primarily quantitative with a fundamental overlay, and they would be more tracking error oriented strategies.” ~ Harry Hartford

[20:53] - “There are things that are supporting that dollar at this point in time…but…you start to get concerned around the sustainability of the Federal deficit against a backdrop where the capital required to fund that deficit comes from overseas…and in addition to that, the absolute level of indebtedness is relatively high. So, I do worry that there are things that could derail the upward trajectory of the US Dollar and I would caution against getting overly complacent, simply because the dollar, for want of a better term, is the only game in town.” ~ Harry Hartford

Links

• Harry Hartford on LinkedIn
• Causeway Capital Management
• “The Boys are Back in Town” by Thin Lizzy

Connect with Us

• Meet Rusty Vanneman, Orion’s Chief Investment Officer
• Check Out All of Orion’s Podcasts
• Power Your Growth with Orion

Disclosure(s) - Orion Portfolio Solutions, LLC, an Orion Company, is a registered investment advisor.

Compliance Code: 1080-OPS-5/2/2024

Today Rusty & Robyn are joined by Michael Arone, Chief Investment Strategist and Managing Director at State Street Global Advisors. Michael is the Chief Investment Strategist for the SPDR® Americas Business at State Street Global Advisors. He is responsible for expanding State Street Global Advisors’ footprint and thought leadership effort through frequent contributions to the financial news media, speaking engagements and client interactions. Michael is a highly regarded speaker at industry conferences and is the author of several articles related to investment management practices. He is a member of the firm’s Senior Leadership Team.

During his more than 20-year career as an investment professional, Michael has served as State Street Global Advisors’ Global and EMEA Head of Portfolio Strategy as well as a senior portfolio manager in the Global Active Quantitative Equity Group. He has substantial experience developing long-only and long-short quantitative strategies and managing investment portfolios using quantitative disciplines. Michael has worked extensively with the firm’s global institutional and intermediary clients to help them identify investment solutions that enable them to meet their long-term financial goals.

Key Takeaways

• [03:28] - Michael’s professional background and highlights from his time at State Street.
• [04:40] - What really makes State Street stand out in this industry?
• [06:28] - What is the primary risk that Michael thinks investors are overlooking right now?
• [08:06] - Even though The Fed is still suggesting it will cut rates soon, it hasn’t made any moves yet, so what should the takeaway be from that?
• [09:27] - Why are growing government deficits and rising, bipartisan protectionism often two ingredients in Stagflation?
• [10:52] - How does Michael assess the current inflation trend?
• [13:02] - What are the potential odds that Stagflation actually occurs?
• [14:32] - How can investors better prepare for all possibilities, Stagflation or otherwise?
• [16:10] - What is driving the potential liquidity squeeze?
• [19:58] - Why don’t investors know more about the surprising outperformance of small and mid cap stocks?
• [21:20] - What should investors know about market concentration and “The Magnificent 7?”
• [23:10] - What are some surprises that Michael has noticed in long maturity treasuries?
• [25:30] - What is currently Michael’s favorite investment idea?

Quotes

[14:04] - “Maybe there’s only a 20% chance [of Stagflation], but it’s a chance that investors are not currently pricing in and they’re underestimating. They are pricing it as a 0% chance, and I think it is probably above that.” ~ Michael Arone

[26:56] - “The top 5 companies in the S&P 500, their market capitalization is more than 3.6x all of small cap put together. That surpasses where we were at the height of the Technology, Media and Telecom bubble, so I think you’ll get some mean reversion…I think small cap stocks are…under loved and that’s one of my favorite ideas for 2024.” ~ Michael Arone

Links

• Michael Arone on LinkedIn
• “Lose Yourself” by Eminem
• State Street Global Advisors

Connect with Us

• Meet Rusty Vanneman, Orion’s Chief Investment Officer
• Check Out All of Orion’s Podcasts
• Power Your Growth with Orion

Disclosure(s) - Orion Portfolio Solutions, LLC, an Orion Company, is a registered investment advisor.

Compliance Code: 0972-OPS-4/22/2024