Meet Efrem Hoffman — he is the “Visionary” behind the Running Alpha Story.
Efrem’s insights are rooted in the philosophy that not all things in the world can be rendered with immediate visibility. This is especially relevant to human-driven financial enterprise. His passion is focused on waking up our capacity to see more, and reveal the dynamics of the whole manifesting in the system parts.
Only then can we start to comprehend the big picture and make informed decisions that can deliberately paint the canvas. Efrem hopes to play an inspirational role in helping investors and business executives have pain-free experiences on their journey toward better decision-making.
His vision is to see Running Alpha as a leading part of a story for rethinking the way mankind can collaborate with nature, to better exploit uncertainty, and compensate for the human condition and machine biases that get in our way of both perceiving world events in high-definition and making bold decisions with attention to detail.
Applying this philosophy to his daily life, Efrem is able to identify hidden Support and Resistance Boundaries for all major markets for impressive results when investors overlay these levels with their own trading tools. When combined with the critical times identified on his inhouse proprietary Time Maps of Momentum Perception Biases and Future Sentiment Jet-Stream Behavior, traders and investors of all skill levels are expected to discover a unique edge they never had before in their trading experience!
To make this experience seamless, Efrem did all the heavy-lifting by embedding this time-relevant decision-making into Running Alpha’s Actionable Intelligence and Trading Idea Commentary.
To best protect yourself and thrive in today’s markets of peak uncertainty, take a “walk into the future” with Efrem, and join him on his journey for opening new avenues of trading and investing clarity, empowering you with original and stimulating insights that are complimentary and refreshingly unique from anything you will find in the global trading research and educational investing arena!
Applying this philosophy to his daily life, Efrem is able to identify hidden Support and Resistance Boundaries for all major markets for impressive results when investors overlay these levels with their own trading tools. When combined with the critical times identified on his proprietary Time Maps of Future Sentiment Jet-Stream Behavior, investor’s are expected to discover a unique edge they never had before in their trading experience!
To make this experience seamless, Efrem did all the heavy-lifting by embedding this Time-Relevant Decision-Making into Running Alpha’s core Heat-Map Display of Alpha-Ideas.
Efrem Hoffman is the CEO, Founding Architect, and Thought-Leader of RunningAlpha.com Investments Inc., an independent client-focused Canadian Innovation Think-Tank, headquarted in Toronto; employing patented and proprietary insights at the intersection of physics and finance to exploit market uncertainty and complexity for competitive advantage; namely:
(i) navigating around fast approaching market threats; and
(ii) hedging-for-a-profit from predictable surprises in global financial, commodity, and foreign exchange markets; surprises which on-balance are otherwise inappropriately misclassified as Black Swan Events — unexpected high-impact tail-risk outliers — by even some of today’s most advanced strategy frameworks.
To observe trend formation before it gets manifested as price transactions, Running Alpha’s Research Framework focuses on observing the physics of market action and portfolio risk factors on a more fundamental scale, namely one that does not confuse the observation and structure of transaction volume behavior and volatility on a given time frame with market agents that created them.
Efrem specializes in developing unique tools for exploiting these overlooked strategic risk factors to enhance the visibility of critical “risk-on” / “risk-off” windows, where markets have high potential for turnaround events; and then navigating around value traps to see emerging opportunities that the crowd cannot see. By embedding these tools in the RunningAlpha.com Platform, we offer a significant improvement to the prior art for revealing time-relevant insights of sentiment perception trends on a human and global scale.
Focusing on identifying Super-Anomalies and Monetizing Hidden Value in Real-Time from large scale financial and social data-sets, Efrem utilizes Advanced Visualization Technologies and Smart-Data Analytic Solutions, he developed out of his Undergraduate Engineering Thesis at the University of Manitoba. From this work, he was not only: (i) recognized by the chief scientist at Canada’s Prairie Atmospheric Environment Service for making valuable contributions to applying machine intelligence for improving the science of forecasting tornado & aviation weather hazards; and (ii) granted multiple U.S. Patents with Big-Data Predictive Solutions that quantify extreme turbulence and uncertainty in financial, social, and atmospheric data sets; but also his Patent Publications have been short-listed for inclusion among thousands of patents in BrainDex’s expansive CD knowledge source of the “215+ Most Fascinating Weather Radar [Inventions].”
His research has been cited on over 300 instances in various publications, including the Patent Documents of Fortune 500 Companies and preeminent scientific think tanks, as well as referenced as a unique tool for converting market uncertainty into actionable intelligence by a prominent pioneer of modern behavioral finance at a Berlin Conference in 2010.
Efrem actively shares his insights on Strategy Development and the Future States of Markets, which includes: (i) frequent trend-pieces, published to his over 28700+ LinkedIn Followers, and accessible by over 100 Million Industry Professionals through his Linked Network; (ii) invited appearances on: (a) TradingPub webinars; (b) panel discussions at Toronto’s Hedge Fund Hotel, and Toronto Charts Day — a live Bloomberg Event moderated by David Scanlan, Bloomberg’s Managing News Bureau Editor of Canada; (c) Dow Jones Newswires article on Portfolio Stress-Testing by WSJ-Dow Jones Reporter & Columnist, Evelyn Juan; and (d) several feature articles in TradersWorld Magazine & On-Line Presentations at TradersWorld Expo, including contributing author to a TradersWorld #1 Best-Selling Amazon Kindle Book — “Learning the Secrets of Successful Investing” — edited by Larry Jacobs in the category of Investing & Commodities.
In the great words of William Gibson, and adapted from Alvin Toffler’s 1982 edition of Future Shock, it has been said that “The Future is already Here, Just Unevenly Distributed.” These words have particular relevance in today’s financial and technology driven economy. The one statistic that embraces this truth also serves as Efrem’s inspiration for creating Running Alpha, namely that there is less equitable wealth distribution in the world today [ less wealth spread out evenly across developing and emerging countries ] than there was before modern information technology and financial engineering practices opened access to global trade and free markets. We need to start leveling the playing field; and that starts here with accessing better intelligence, so that you can begin making 360 degree decisions; putting you on top of the playing field with the likes of institutional investors, expert networks, and market influencers.
If there is just one thing Efrem has discovered — hitting home hard through his experiences and those of countless others — that gets in the way of successful investing and trading strategy implementation for the novice and expert alike, is the lack of organizing your precious time around putting together a focused basket of today’s highest-impact opportunities in tomorrow’s most relevant industries; and then, as the legendary investor, Gerald M. Loeb reminds us, from his words in “The Battle for Investment Survival,” never keep your eyes off the basket.
Successful Investing is not just about Finding the Next Great Idea; it’s about:
Looking For a Place Where Your Best Trading Concepts and Insights Can Spring To Life;
Enabling You To Make Entry, Exit, and Trade Management Decisions with Ice in Your Veins.
Efrem Hoffman is consistently ranked on Thinkers360’s leaderboard of the world’s top 50 Fintech, Quantum Computing, and Cryptocurrency thought-leaders, and has been:
Featured and Quoted in Best Selling Amazon Book Releases in the categories of pption and derivative trading, and [ B2B Business Technology Innovation ], including:
The Nuclear Option: Trading to Win with Options Momentum Strategies; and The Remarkable Effect; has been invited keynote speaker alongside Technical Trading Market Hall of Fame luminarie(s) on Bloomberg Charts day and on a Semi-Annual Addresses to University of Toronto Risk Lab – an NSERC sponsored organization; appearing internationally in PhD theses, and Fortune 500 AI patents and those granted to Ivey League Institutions and Federal Government Agencies. Efrem has also broke stories with Eamon Javers on MSNBC, Bloomberg, BNN Bloomberg, which were syndicated across world-wide mediate networks and leading digital magazines.
Efrem started out in the StormTech space figuring out ways of mitigating catastrophic outcomes – collaborating with a research consortium, including Environment Canada’s Prairie Storm Prediction Center, Info-Magnetic Technologies Corporation, and TR Labs, the Electrical and Computer Engineering research arm of the University of Manitoba, for developing Fault-Tolerant Early-Warning Tornado Alert Systems for safeguarding human life and property from extreme weather events.
With over 300 worldwide citations to Efrem’s work, research frameworks, and patents ( covering 27 systems and process claims — U.S. Patent #s: 6,035,057; 6,278,799 ),
from many world-class financial and academic institutions, national research labs, tech power houses, and fortune 500 companies,
including, but not limited to:
Avionics and Military Instrumentation (Rockwell Collins, Lockheed Martin Corporation), Atmospheric Weather Agencies, Enterprise Software & Hardware Management firms, including IBM, Microsoft, & Sony; Mobile Communications Operators — Nokia, as well as Government and Private Think-Tanks, including MIT, the U.S. Department of Energy alliance partner — Pacific North-West Labs Battelle Institute, and the U.S. Navy. ( Full list can be found in the links above ),
Efrem is continuously expanding the frontier for building and maintaining Running Alpha’s investment strategy infrastructure and expanding the use cases of alternative data pipelines; and
actively collaborating and partnering with a global network of thought-leadership thinktanks and industry-leading research scientists, economists, quants, professional on-and-off-the-floor traders, institutional investors, and FinTech industry veterans, many of whom are Data Science powerhouses.
Ranked Global Top 100 Fintech Influencer in 2022 by Growth Gorilla —
a UK based world leader in comprehensive rankings and go-to-market strategy for global FinTech enterprises; and
Short-listed by Efi Pylarinou, the Visionary of Daily Fintech,
a seasoned Ph.D. Wall Street financial professional and independent Blockchain advisor,
who ranks as No.3 influencer in the finance sector and No.1 woman influencer, by Refinitiv Global Social-Media 2019; where Running Alpha was featured in Daily Fintech publication among the Top 10 Emerging Financial Technology Platform Leaders and Sentiment Fin-Techs in the U.S.,
focusing on “the AI business of “sniffing out” [signals] in digital wealth management, and changing the value proposition of financial analysts and asset managers.”
Running Alpha’s financial technology solutions have also been:
Nominated in 2016 for the Benzinga ( BZ ) Fintech Awards, (aka, Global Fintech Awards), where Running Alpha placed as a Finding Alpha Finalist, where Benzinga News interviewed Efrem about Running Alpha’s technology innovation, Live and in-person, at a New York Gala event;
Scouted out and vetted by the Founder of Toronto, based Street Contxt Exchange in 2018, hailed as the “Netflix of [Market] Research,” to be among the first 35 independent investment market research intelligence contributors on their global marketplace;
bringing the buy and sell sides of Wall Street and Bay Street closer together than ever before; with client coverage of over 300,000 individuals across 47,000 firms in 153 countries.
Efrem has been privileged to:
establishing many ongoing relationships with world-class giants in the field of real-money trading and investing, innovation thought-leadership, including practitioners, and academics;
who made life-changing contributions to both science and society –
people at the intersection of curiosity and genius, that he thought were interesting and incredible citizens, who were pioneers in their respective disciplines:
asset pricing, economics, game theory, floor trading, artificial intelligence, swarm intelligence, quantum mechanics, predictive and prescriptive analytics, data science, field-programmable logic, fractional calculus;
zero-knowledge proofs, multi-dimensional Visual Decision Support Systems (VDSS) and digital information murals, real-life tornado simulations, atmospheric and climate physics, and space weather forecasting.
Efrem’s thought-leadership insights have been numerously quoted in the international press:
CFA Magazine, NASDAQ news, Huffington Post, Vanity Fair / Hive Magazine, Hamburg News, Bloomberg View, Thompson Reuters / WSJ, CNBC breaking news article by Eamon Javers, CNBC Anchor and Senior White House Correspondent, relating to Presidential Market Factor.
Efrem was short-listed among industry peers, to share his unique expert insights on trading market strategy in a chapter of “Learning the Secrets of Successful Investing,” which became a #1 Best-Selling Amazon Kindle Book in the category of Investing & Commodities –
edited by Larry Jacobs, the 2001 World Cup Trading Championships® Winner for stocks, and founder of TradersWorld, now operated by Halliker’s Inc.; and
has also appeared on Live on-air Business Innovation and Investing Education Interviews and Expert Knowledge Sessions on North American business market intelligence podcasts and radio broadcasts, including:
In-person show(s) in Chicago on Benzinga PreMarket PREP, where, on one of several digital episodes, Efrem shared his market intelligence live on-line from Toronto, Canada on a special morning lineup;
featuring prominent Wall Street financial and economic experts, who independently kicked off the morning broadcast, including: Ron Insana, former CNBC anchor and author of Insana Market Intelligence; Michael Corcelli of Alexander Alternative Capital; and Mohamed El-Erian, Chief Economic Advisor at Allianz;
frequent guest invites on Benzinga PreMarket Prep News and Radio Network, where on live-air he is known for making winning bets with the host on extremely bold, contrarian, and timely market calls on outlier events, right before watershed market extremes, where history has proven out that those on the other side of the trade were overly pessimistic or optimistic; and
Global Industry Events in North America and Geneva, Switzerland, including moderating roundtable discussions on “Innovative Trends in Multi-Factor Investing and Alternative Data Augmentation – Smart-Beta 3.0,” alongside founders and C-suite hedge funds and ETF industry innovation specialists from boutique and big investment banks at Trading Show Chicago 2017,
where Efrem was as an invited keynote seminar speaker on ” How to think Differently about Financial Market Trends using Running Alpha’s “Bottom-Down Intelligence™;” also
serving on live in-person expert discussion panels at:
Terrapin’s QuantWorld Canada 2017, moderated by Ernest Chan, adjunct faculty at Northwestern University, Master’s in Data Science program on best practices in finance and machine learning; and
Trading Show Chicago 2017, and Toronto-based Hedge Fund Hotel (where, WSJ-Dow Jones Reporter & Columnist, Evelyn Juan interviewed Efrem for a Dow Jones Newswire article [ Portfolio Stress-Testing in Financial Market Hurricanes ]),
on topics ranging from trading on social sentiment trends, to unique machine intelligence and alternative data strategies, with luminaries of finance, including:
a market data specialist from one of the most respected hedge fund trading firms;
a world-leading quant commodity pool operator and trading advisor, who is an influential data science teacher and prolific author of machine learning principles for democratizing access to algorithmic trading strategies.
Featured by Value Inspiration Network,
hosted by Ton Dobbe, a 30-year veteran and globally recognized business strategy and B2B software innovation thought-leader in Spain,
Efrem’s lively podcast exchange on “How Human and Machine Combos Can-Be Used To Avert Financial Tornados,”
captivated and inspired Ton so much, that he not only featured Running Alpha’s competitive edge and Efrem’s educational quotes on risk and innovation, alongside 100global industry influencers and leading tech-entrepreneurs-on-a-mission,
in his Best-Selling paperback / hard-cover/ and Kindle formatted Digital Business Software Innovation Book – The The Remarkable Effect; but also,
included Efrem’s profile and blurb on the back-cover.
John Rubino, a former Wall Street Star Analyst and featured columnist with TheStreet and prolific author of several books, including The Money Bubble, interviewed Efrem for a feature article in the Chartered Financial Analysts (CFA) Magazine, Volume 27, Issue 3 on Sept. 16th 2016, called “My Favorite Robot.”
Here is a portion of the Efrem’s dialogue with John Rubino:
“Two-way transparency will also become increasingly important. “Right now, money managers are judged based on performance relative to target indices. That obscures a lot of important [nuances],” says Hoffman. Next-generation AI, [Running Alpha has developed] “will be able to not only compare fund performance with peers but track the underlying reasons for the performance so it’s more aligned with the [investor].”
The same technologies will offer better insight into exactly who customers are and what they need. “Every new client defines their risk tolerance and other preferences upfront, but that information has a short shelf life and is potentially inaccurate,” says Hoffman. “Most people don’t know what their risk tolerance is. And a [ Portfolio Manager ( PM ) ] managing [over] 400 accounts can’t track their subsequent behavior in response to volatility episodes.”
Consider an imaginary scenario: Two clients both claim moderate risk tolerance, but a sharp market correction elicits a “sell everything” call from one and a “buy the dip” from the other.
Future AIs will be able to track these responses and “put clients with managers who align with their behavior,” says Hoffman, who proposes a new performance metric called “anxiety-adjusted return[s]” to gauge this relationship.”
Efrem has also been recently interviewed by a prominent London-based buy-side Alternative Financial Market Big-Data Vendor with international operations,
for showcasing Running Alpha’s augmented data intelligence services to their premium platform subscribers – including large institutional investment banks, hedge funds and data science thinktanks in the fintech vertical,
who are looking for new sources of data that will be amplifying the alpha-signal strength and extending the shelf-life and reliability of their existing data sources.
With exclusive invitation, Efrem proudly serves as:
Industry Survey Alliance Partner, to ChangeWave Research, a division of 451 Research — providing time-relevant Insights on current consumer and business Trends impacting the financial community, with a focus on IT and Networking Technology; and
Corporate Research Member to Tactical Rabbit Inc, an elite closed intelligence network offering break-through military intelligence gathering methodologies to ascertain the relevant information so that the right mission-critical business, economic, and social decisions can be made under conditions of extreme and apparent uncertainty; and has been actively engaged as a:
Canadian Research Member to the late Barydyne Traders Group Project; a breakthrough global think-tank, whose mandate is reinventing the future of trading in a live trading lab. The mission there was to contribute valuable insights for promoting the science of prediction to trading.
As a member of this trading group, Efrem actively participated in group decisions with the director to select buy, sell, entry and exit strategies, and was instrumental in helping members reorient their views on time-relevant opportunities for investing in emerging semiconductor megatrends, right near a pivotal point in history in the 2010s, proved prescient.
Efrem also received formal instruction on Professional Real-Time Trading Floor Technologies and Data-Provider Architectures/Configurations, and Multi-Dimensional Visualization and Data-Mining of Real-Time Financial Data – in New York (Waters Corporation) and Toronto (Visible Decisions, Inc.), alongside senior executives of Fortune 500 companies, including some of the world’s largest investment banks and software development firms ; and
actively shares his insights on Strategy Development and the Future States of Markets, which include:
frequent trend-pieces, published and accessible to his over 27,600 direct LinkedIn Connections and Followers, and over 2680 subscribers, that joined in the first few weeks after launching his LinkedIn Newsletter: Hoffman Financial Storm Chaser™.
With a strong practical understanding of financial innovation use cases,
Efrem brings a broad-scale practical perspective to making sense of capital market and economic movements, for advancing the science of precision wealth-intelligence;
Founded on a unified framework, of three innovations:
Multi-Valued Computing Logic, Bottom-Down Analytics™, and Crowd-Physics™,
Efrem is opening new ground in levering Quantum Machine Intelligence strategies,
for giving precision insight into international capital and domestic liquidity movements in both publicly listed and dark markets — off-exchange venues, where market dealers work on behalf of big institutions to mask their order-flow intentions.
Efrem started out at a time when few in the business community were aware of our framework’s universal potential in other industries — over 15 years before it became a buzzword on Wall Street and Main Street.
Although the initial focus was Tornado Prediction from high dimensional radar imagery, which unlike a picture of a car, as seen with a camera, 3D weather-radar reflectivity echoes of wind patterns, and signatures of whirling cloud droplets, colliding and bouncing off each other in the sky, are only abstractions of reality.
His scientific approach was so unconventional and promising that, not only did Efrem receive special recognition by a lead research scientist at the Atmospheric Environment Service (AES) Prairie Storm Prediction Center,
for making significant contributions to StormTech science and transforming the way experts can start thinking about making better sense of hierarchical patterns in just about any unstructured multi-dimensional big data sets ( including financial markets ),
while teasing out, at remarkable speeds ( up to 1000 times faster than conventional AI and more accurately than classical algorithms on a supercomputer ), the salient predictive features at local and global scale,
but the technology innovation use case also played a role in pilot-test studies, and later featured by Braindex, as among the top 250 most fascinating weather radar inventions.
Efrem has an unwavering fascination for bringing the common ground, unique challenges, and bleeding edge solutions he discovered across multiple disciplines to building solutions for observing the collective human perception and behavioral traits and biases that make markets tick; and give rise to sudden outbursts of extreme bullish and bearish activity.
These interactions have humbled Efrem to appreciate the importance of knowing when to start applying and investing in a technology; and of equal relevance, avoiding situations when the underlying assumptions of a technology’s function and utility create unacceptable trade-offs that are incompatible with the current and upcoming market environment.
By augmenting the benefits of industry knowledge and human judgement with non-discretionary strategic insights from academia and industry, Efrem has acquired a respect for how the human condition, trying to make sense of the unknown, both interacts and interferes with mathematical modelling.
That’s why Efrem Hoffman’s strategies and research frameworks are challenging the fundamental limits of conventional logic for which almost every life and death, career-changing flight or fight, decisions we make, are based on.
So, Efrem’s message is clear — we better be prepared to see outliers, irregularities, and uncertainty for what they really are — the most persistent windows of opportunity that should be embraced for converting strategy into action inside the World’s Thinnest Risk Horizons™.
What really catches Efrem’s attention is when the underlying premise of the consensus view, particularly of the market’s collective behavior and expectations, not only diverges wildly from reality, but is founded on a rigid monochromatic belief system and theory, that is not verifiable in the real world.
He especially derives pleasure from assisting investors with making sense of current conditions, and then levering this dynamic knowledge for generating high levels of anxiety-adjusted returns.
To this end, Efrem is delivering insights into what’s not only new,
but also, how his new innovation in investing technology and prescriptive analytics has the power to inspire audiences to innovate at a new level, and transform specific industry and organizations forever.
Through Efrem’s close observations of his dynamic market maps, he noticed that there is a “constant pressure, pushing toward patterned structure –
a tendency in matter and belief systems, to evolve into ever more complex and emergent forms;
those elemental properties nature has employed for billions of years, to create rich diversity, including us and the biosphere we live in today.
It’s a kind of pattern gravity; a latent energy and driving force in the cosmos, markets, business, and life gives rise to internal behavior of financial market players,
that are spontaneously giving rise to energetic market action, in the absence of both external shocks and financial, monetary, and social stimuli,
much like the self-organizing pattern that you may have seen emerge when a swarm of bees or a flocks of birds interact.
With a mindset bent on exploring the most profitable motifs — alternative future system states inside the world’s thinnest risk windows,
Efrem, with the aid of Running Alpha’s proprietary Quantum AI-Powered Momentum Perception Maps™, is periodically running
Simulations of what would happen to the mindsets of broad-scale market players ( and their field effect on forward sentiment changes),
when both active market agents in the present and diverse pools of available investors from the future begin dialing up or dialing down the extent to which their momentum biases,
traveling along future strips of time,
are in agreement or disagreement with each other.
Knowledge of these timing windows breaths fresh insight and life-changing foresight into pivotal changes in the Sentiment Jetstream, driving tomorrow’s most powerful asset price actions and alpha opportunities.
These quantum effects that we observe behind the scenes for you on our maps, are revealing the location and time coordinates of market player momentum perceptions ( objects ), from data ( the light ) that has yet to actually touch these market participants, let alone register on their market monitoring instruments.
In other words, no longer does an object ( market player biases ) have to be in the field of view of the camera ( market measurement device ) in order to take a picture.
It’s Like Seeing Things Without Looking At Them.
By unlocking access to special entangled states and market structures, that were previously invisible,
Efrem has built the foundation at Running Alpha for Reverse Engineering What Competing Market Players at Broad-Scope Scale Will Be Observing and Acting on in The Future;
Enabling investors to gain early insights into when market biases are not in a coordinated configuration, thereby, indicating when investors should simply stay away from making new capital allocation decisions,
given that markets in this state, strongly tend to offer fewer meaningful arbitrage opportunities, after risk and reward is factored into the equation.
You now have a choice of being the statistic or making it work for you, before the light ( the data ) that gets collected from the next event becomes the next future touch point, that is used by most market practitioners and risk managers in hindsight, for updating their playbook.
Momentum Perception Maps™ gives our founder, Efrem Hoffman,
a springboard for stepping up your game and elevating your edge at better anticipating which catalysts will have the highest potential for disrupting the status quo of crowded trades and turning them into your alpha gain.
What would have normally taken a team of 20 upwards to 100 or more market analyst’s days or weeks to analyze at lower fidelity, a single individual can start using these actionable buy and insights,
systematically derived from Efrem’s Momentum Perception Mapping technology; thereby
singlehandedly completing the task intraday, ahead of critical market events, and doing so, not only emotionally free, but with much higher confidence, fidelity, clarity, and precision;
enabling you to start:
boldly expressing best-in-class bullish or bearish trading and investing ideas in the face of unprecedented uncertainty, with a simple stock buy and sell order,
all without the use of leverage or any kind of complex trade positioning strategy.
With a 360-degree view of global markets, Efrem is now captivating an audience of professional traders, retail investors, and portfolio money managers of all skill levels, with engaging market intelligence and education that is uncovering actionable outlier trend opportunities in uncrowded liquid markets, while positioning for capital defense and profiting from momentum crashes and trading around Chaotic Momentum Crush.
Efrem built Running Alpha from the ground up to ensure the adoption of a Risk-First Culture; laser focused on raising the trader’s capacity for understanding how and when the underlying sources of risk are changing, specifically:
how the risk matrix can be quickly transformed from one regime to the next with just a single changing variable as subtle as the passing of time itself, spontaneously shifting the correlation among the momentum perception biases of broad-scale groups of interacting market players.
This intelligence is of high-value to every trader and investor that is looking to profit from momentum trends, short-squeezes, and violent extreme reversion events, because it is designed for shrinking their time-exposure to risk in all market environments and avoiding Momentum Traps, Negative Gamma Squeezes, and Value Traps.
Our leading indicators and Momentum Perception Maps render visibility into the Future Sentiment Jet Stream – specifically correlations the marketplace cannot see –
previously unseen connections among market-players and cross-market perspectives of momentum change and sentiment bias that give foresight into sudden and often surprising market swings and broad-scale changes in both trend and capital information flows in Dark and Lit Markets.
We do this by:
Homing in on uncrowded trading markets inside focused trading windows, where there are many sources of perceived risk coming from all directions, when few traders and investors have the courage to step into markets that are least travelled – thereby amplifying the inefficiencies we are extracting.
Running Alpha was founded in 2012 by Efrem Hoffman to Shrink the Time-Lines for:
Catching Falling Knife Markets; and
Profiting from Emergent Outlier Trends and Momentum Crashes.
Running Alpha does this by helping investors fearlessly trade inside market windows that are dominated by emotional trading behavior – including panic-markets that are in freefall, just before high-momentum trends begin spectacular turnaround events that both crushes the prevailing momentum, and seeds new rounds of super-outlier growth – both in magnitude and duration.
Instead of creating flashy dashboards presenting the kitchen sink of rear-view conventional indicators, our focus is on observing leading indicator of change for understanding when you need actionable information, and for making critical decisions that will either lower your risk, and increase your anxiety-adjusted return after inflation.
Running Alpha does this by Elevating Your Capacity For Re-Imagining a Different Future and Capturing Alpha Momentum Outlier Trends and Chaotic Momentum Crush, a special class of Extreme Reversion Events,
Never Experienced Before in Equity and Option Markets.
At Running Alpha, we give you a new window into the future, where:
Every moment in history is really like no other – not just in our time, but every time — because the decision-makers that create the perceptions of our current conditions are not the same ones who are observing them.
As history expands and the number of potential connections and interactions among market players gets more complex, the variety and magnitude of future outlier growth expands relative to outlier events we have experienced in the past.
By putting the effects of observer interaction and market system complexity of decision-makers back into the trading equation, Running Alpha is helping traders’ profit from future market paths yet travelled; and get ahead of market players that are still fitting their models to rhyme with yesterday.
What sets us apart is that Running Alpha is levering principles at the intersection of deep physics and finance, including quantum-inspired computing and computational circuit complexity, for quantifying windows of maximum market inefficiency, when the sum of these expanding numbers of globally interacting market system parts –
the non-linear action-reaction feedback chains among market players for a given asset —
will be growing exponentially larger than the effect produced by the individual parts acting locally within the expanding whole.
Inside these windows, where market reaction times to emerging events take longer, Running Alpha is boosting the productivity of traders by:
Amplifying what makes decision-making most productive – telling you when your data assets and trading methods will offer the highest reward and value at the lowest risk points.
In other words, we tell traders and investors when to show up in the trading room, thereby reserving emotional and trading capital for those moments that matter most –
when markets are least efficient at reflecting current events and future expectations.
Running Alpha is providing actionable intelligence for capturing live real-money and high-conviction trading and investing opportunities, flying below the radar, at the most change-making moments, Inside the “World’s Thinnest Uncertainty Windows,”
where we can be most confident of market action — producing the longest and most sustainable outlier trends. runways to growth and earnings price expansion, from our entry prices.
Running Alpha is not simply focusing on Finding Alpha based on the prevailing market structure in lit ( on-exchange ) public markets, but is
opening new ground in revealing market imbalances and predicting super-anomalies and otherwise invisible outlier opportunities,
that arise when Dark-Liquidity Pools ( off-exchange unlisted venues ) interact with lit markets.
Instead of betting on known outcomes of future asset price or news events that cannot be predicted in principle, Running Alpha brings a new level of transparency into the investment analytics equation; capturing the broad-scale momentum perception biases, governing the sum-non-linear observer interactions and action-reaction feedback chains, within and across markets, and in all directions.
Whether you are a stock market wizard or a first-time investor, you can count on Running Alpha’s game-changing insights.
We put high priority in letting you know in plain English when our Alpha Windows of high-impact market activity become active. That is when trading opportunities should be taken very seriously.
Our Trading Windows span from 50 to 95 days, and at times can extend beyond 3 months, upwards to 6 months, given that this is a typical cycle duration of individual sources of risk in the post-crisis era.
Within these intervals, we trade around core positions, by dynamically assessing risk exposure per unit of time, and identifying whether reward-to-risk parameters, still available in an existing core position, has sufficient potential to match up with fresh opportunity candidates of at least equal conviction.
This keeps us agile to changing market conditions, while still keeping our portfolio turnover manageable, regardless of the size of our portfolio, be it concentrated with 3 to 4 positions, or diversified with 12-to-14, 21-to-30, or even 40-to-50+ high-impact opportunities.
We are not tethering our decision-making to historical relationships in price or any other factor;
instead of following the trend directly on the time horizon of interest, we are trading inside narrow time windows when the current market trend is in agreement with the latent market energy stored in the self-organizing inner momentum structure of longer-range market-player connections, that are:
driving the market physics of outlier asset price formation in the order-book, particularly
when human emotions will be disproportionally amplified in the direction of the trend, and prevailing over common sense and reason surrounding the fundamentals or news events.
By analyzing the collective dynamics of financial systems, comprised of many interacting parts and economic agents, especially when facing unusual or emergency situations that have limited or no historical analogs; we are essentially:
working out the sum non-linear behavior, that results when many different types of market participants, with competing preferences, are colliding at different speeds.
Efrem has discovered that when these preferences are placed in a competitive environment, sometimes they can self-generate unique forms of motion.
This new class of “unsupervised” market intelligence, which Running Alpha’s founder coined as Bottom-Down Intelligence™ ( BDI ) is exciting for investors, because it offers a new wrinkle into understanding and predicting the behavior and piece-wise chaotic momentum trends in complex systems with many interacting parts .
Likened to the moments when phase transitions are triggered in physical systems, so too there exists special moments, when the spontaneous motion of market actor biases become manifested in future price.
These special types of regime change are known as exceptional points.
[When many disagreeing agents are put together, this creates a constant collective movement, generated by the “frustration” in their competing tendencies.]
It’s unusual because there’s no external force or stressors causing them to change their spin (upside or downside bias).
The rotation of the momentum flow simply comes from the spontaneous field effect created by how the agents are continuously communicating their interactions through acting or in-acting on their perception biases and expectations of the surrounding market environment.”
Understanding momentum-based strategies of this new type for capturing the forward sentiment bias across asset classes, are especially useful in high inflation environments, like we are experiencing today.
The underlying logic is that momentum in consumer prices leads to persistent reactions in both central bank and private investment decision-making, which in turn drives asset price action.
A combination of unexpected and sharp spikes in inflation and/or inflation expectations, cloud cover surrounding the duration and extent of supply-chain disruptions, and export restrictions and protectionist trade policies, give rise to situations,
where emotional reactions to these highly uncertain outcomes can get elevated to such untenable levels for economic capital allocators to reliably manage business expectations and purchasing decisions. Such situations lead to exaggerated momentum movements in asset values.
When asset prices get pushed too far in one direction too quickly and/or over a prolonged period, they can quickly start reverting from an extreme, when investors in the prevailing trend begin unwinding their concentrated bets; thereby sending asset prices moving at an even faster rate in the opposite direction.
Our research intelligence framework and Momentum Perception Map technology, is designed precisely for this task, namely,
telling us when these extreme reversion events are knowable, and in those special time windows when we can see them before they happen,
we alert our premium subscribers of these critical transition price points, which have high potential for triggering the onset of:
Momentum Crashes – when the relative performance of the stronger and weaker assets flip direction, momentum strategies that were working before the transition begin failing ( which is distinct from the notion of a stock market crash, which, we have a remarkable record of seeing before they happen ).
Efrem built mechanisms into the strategy for performing this task unlike any other advanced AI model in existence today –
by uniting the super-exponential power of special quantum entanglement states in complex dynamic systems –
with early insights into the evolving underlying instantaneous and spontaneous network connection structure and interaction effects among financial market agents – and their sentiment perception biases, driving emergent trend changes.
This allows us to deliver our premium subscribers with the highest probability investment and trading signal confirmations inside the World’s Thinnest Risk Windows™, just before a falling knife begins a spectacular reversal.
We do not need to wait for breakouts to confirm our best signals – in fact those who wait for such events are lowering both their risk-adjusted and anxiety-adjusted returns.
To render visibility of the broad-scale interacting momentum rotations that are giving rise to these exceptional points, Running Alpha has developed an inhouse tool, called Momentum Perception Maps™ ( MPMs ) –
forward curves overlaid on price charts across future time points, that correspond to asset price levels in the future where market players with different holding periods ( making decisions on different time lines ) will be observing pivotal changes in trend around the zero-point momentum levels.
We scrutinize these momentum flight paths of market players, across the complete scale of trader and investor time-horizons, for seeing a birds-eye view of how momentum perceptions of different market players will be combining in just right combination at the right moments, for: generating the dominant Sentiment Jet Stream; and driving both directional asset price and forward volatility behavior over the specified trading window.
Instead of adding assets blindly to create a diversified portfolio based on correlation matrices or functions of risk and return, that are anchored to past multi-variate relationships, we calibrate forward by combining assets with Sentiment Momentum Jet-Streams that are not only varied in shape and scale, and staggard in the phase of their component momentum term-structures.
This gives us the confidence for constructing portfolios that can respond uniquely, yet beneficially to different news sentiments and risk/return factors; thereby elevating our sentiment factors to a form that is significantly more stable than factors of return or even risk.
We have found that risks of high consequence to portfolios usually resides in a few momentum perception factors — price, volatility of price, and variance of volatility of price — that you can count on your finger.
This makes our momentum perception filters superior for:
compressing the dimension of the portfolio “factor zoo,” thereby, reducing the chance that some sets of assets are unknowingly taking on an unreasonably dominant or concentrated role; and
uncovering a blind spot in conventional measurement of market momentum, that gets in the way of accurately seeing how over 100 years of modern stock market history shows that we can exploit the false assumption that the “madness of crowds” and “irrational exuberance” are the underlying mechanisms behind buying or selling panics.
Running Alpha has observed that when people are clustered into certain pockets of arrangement, with just the right time delay and sequencing of movement, the toppling effect and compression from crowd turbulence do not occur in the presence of any one or combination of individuals orchestrating the movement, and
cannot be revealed by simply assuming that humans behave as sets of repulsive particles, that tend to move out of the way with increasing momentum when the distribution of their cross-market trading ideas, momentum perceptions, and positioning histories get overcrowded and “too close for comfort,”
but rather are predisposed by the way people and machines are hard-wired to avoid collisions, particularly by anticipating when the velocity and trajectory patterns of neighboring bodies pose a clear and present danger.
In other wards, it is not how close price gets to violating a trend that sparks people into emotionally-charged action, but the perception that the speed of change of an asset’s price is threatening to break trend and set off wild fluctuations in market-wide correlations, at a speed and magnitude that is not yet reflected in future expectations ( implied volatility ).
This is why we do not need to wait for breakouts to confirm our best signals – in fact those who wait for such events are lowering both their risk-adjusted and anxiety-adjusted returns.
To help traders and investors get positioned early with less risk exposure and confusion, we observe Negative Gamma positioning of Market Dealers on Public Exchanges, and identify situations when Dark Pool activity on unlisted venues (off-exchange) is showing large institutional buying, while public markets are diverging with heavy selling pressure.
By combing this extra layer of transparency into dark and lit markets with insights gleaned from our Momentum Perception Maps™, we are not only:
exposing extreme reversion event risk from the perspectives of individual and cross-market volatility, and variance of volatility, before trends change direction, but
we are also revealing the hard lines and state transitions, separating “falling-knife” markets with “dead-cat bounces” from true market capitulation events, that lead to V-bottoms/W-formations and sustainable anti-fragile market recoveries with intermittent square wave price behavior, followed by high price persistence and asymmetric volatility expansions, within longer-term secular trends.
This gives Running Alpha an edge at helping traders and investors get ahead of 99% of market players, for: previewing changes in market mood well before they are reflected in price action, uncovering emergent narratives and the most convenient ways for expressing actionable opportunities that will benefit from the next big transformational changes in both Developed and Emerging Markets, including selected single stock equities and General Market ETFs and Index Factors ETF Instruments, covering:
Exponential Technologies, Digital Communications and Semiconductors, Infrastructure, Manufacturing, Industrial / Commodity Producers, Mobility Logistics and Electrification, Renewable Energy, Agriculture, Timberland, Dividend Kings, Covered Calls, Royalty Streaming Companies, Precious Metals, and Battery Minerals, and specialty chemicals –
Companies and industries that are making the world tick.
With over 3000 highly liquid equities, ETFs, and commodity assets we monitor in just our non-global coverage universe, we are virtually never at a loss for a steady pipeline of high-performing assets, that can move the performance needle in any market climate.
What’s even more unusual about the investing framework is that it does not require the use of complicated strategies, other than simply buying and selling a unique subset of equities that do well in bull and bear markets, even when leverage is not applied.
Trading Market Intelligence Performance Traction:
Running Alpha has captured many highly profitable trades this year for its subscribers; here are a few:
“an Unexpected Bullish Reversal in the S&P;
a Surprise Move Up in the Semiconductor Index; and
a Very Surprising Melt-Up in the Precious Metals Sector.”
Here are the Performance Highlights of 2022 Global Market Intelligence
2022 was one for the record books, where:
We gave early warning about the historic bond market crash,
the relentless rally in Mortgage Rates, and
the unusual acceleration and stickiness of inflation and inflation expectations, and the lack of control central banks to putting the inflation genie back in the bottle.
We were not only early and right about the breakout and broadening of geopolitical conflicts and war igniting in 2022 based on our unique leading indicators of global money and commodity flows,
but, also the precise timing ( to the starting and retreating interval ) of the historic spike in Natural Gas and Electricity prices in Europe.
We were spot on regarding the manic buying in energy stocks and agricultural commodities, right as we were leading up to the start of the Russian invasion of Ukraine.
We were right about the corners of the marketplace that would experience extreme volatility shocks, as well as the opportunities for harnessing the power of our proprietary Bottom-Down Intelligence platform for identifying, with high-conviction,
precisely when market activity of the smartest institutions on unlisted (Dark Pool) Liquidity venues will be forcing the hand of listed (Lit) markets, that everyone else participates in.
We successfully applied this intelligence for correctly informing our premium subscribers of impending “momentum crashes”– those special moments in time and price, where some of the poorest performing securities and markets would become the best performers in the following interval.
As an example, on late January 2022, moments before the war broke out, Efrem was a special guest on a private webinar to High-Net-Worth Investors and Portfolio Clients of a Bay Street market intelligence firm — Strategic Analysis Corporation (SAC), founded by Ross Healy, Chairman, who also serves as a regular featured Market Call expert on Bloomberg BNN Television.
On the webinar, Efrem issued a high priority Red-Alert back in January 2022 on imminent inflationary pressures, which also featured Geopolitical Escalation Alerts to our premium subscribers before the Russian-Ukraine war erupted –
indicating that grains, corn, soybean prices – GCC and GNR, and DBA would surge, along with a Massive Historic Spike in Natural Gas prices into double digit territory – and
then went on to pinpoint the opportunity window in the best-in-class equities in the Energy space that would benefit the most from the anticipated disruption in supplies, and the rest is history now with the inflation genie out of the bottle.
Generated market calls ahead and during the 2007-2008 market crisis that were significantly more accurate, bold and timely in both initiation and exit:
- Compared to performance ratings of over 3000 equity analysts at 432 leading firms, followed by Bloomberg Magazine, Aug 2008; also outperformed security selection of banks that were listed in Bloomberg’s 2011 Risk Report.
- Successfully assisted a Merchant Banking Firm and alerted several High Net-Worth Individuals, including a leading Canadian venture capitalist; a serial technology angel investor, and multi-billion-dollar hedge fund manager, from assuming Market Risk prior to Running Alpha’s accurate New York City and Toronto Road-trip crash alert of the 2007 & 2008 crisis;
- Warned Senior directors and traders at Bear Stearns of looming crisis and told their workers to find new jobs, while stock was still near $100.00;
- Addressed a leading Toronto-based Value-Investing group that is among a market call feature favorite on Bloomberg Business News Network,
Efrem on behalf of Running Alpha, correctly made the high-conviction case of surging Energy, Natural Gas, and Agricultural Commodity price inflation, with uncanny timing of its magnitude and persistence,
ahead of the breaking news on the Ukraine Crisis. Efrem also successfully alerted the firm with high specificity of an impending $1000 point prolonged sell off from Gold’s 2011 highs during the European Crisis,
when virtually all on Wall Street and Bay Street had only general outlooks with relatively bullish targets.
- Research Framework originally generated advance alerts on an Investment Roadshow Presentation in Toronto and New York of an impending volatility storm threat, with specificity more than 3.5 years ahead of the Great Financial Crisis event, & to within 3 days of the specific markets melting down – with over 3 months lead time.
- Correctly warned of toxic volatility several weeks in advance of the May 6th, 2010 intraday Flash Crash, & made early notice of its absolute magnitude and speed, and the V-bottom rebound that followed.
Running Alpha’s Research Intelligence showed similar foresight ahead of the Pandemic, Housing Crash, Dot-Com Bubble, 1997 Asian Crisis.
The strategy framework was stress-tested going back up to 400 years, covering 82 spectacular crisis situations, including:
the 1987 Stock Crash; 1970s inflation; 1930s Depression, 1929 and 1921 Market Crash; the 1800’s banking panics; the South Sea Bubble and the Holland Tulip Mania; and subsequent recoveries across world capital markets.
Also, more recently, when many analysts, before year-end 2022, were underestimating the amount of money that would flow into semiconductors, hoping to wait out for valuations to get as cheap as they have been in previous market troughs,
Running Alpha’s market maps were telling investors to be as aggressive as they can; and
since we were on the public record on New Year’s Eve. 2022, with over 2630 members subscribed to our Financial Storm Chaser newsletter, many which are some of the most sophisticated global asset managers and quant traders at big institutions and ivy league academic thinktanks,
the strategy has, on-balance, displayed over 40% gains without leverage in semiconductor ETFs alone;
with much higher performance in individual companies, all of which were selected outperformed their benchmark on average, particularly when accounting for active trading around core positions;
at which point, some analysts finally called in the towel on their bearish outlooks and did an about face – not once,
but on an industry-wide basis, as they frequently get caught up in either entering too late or getting in too early with too much exposure to underperforming equity assets.
This is not a one-off event; in addition to capturing every notable bull and bear market panic wave, and secular recovery and mania in the current century,
we have also recently been gaining industry traction, with not only our successful market calls and line-up of requests for feature interviews on live streaming television and digital press, but with also a very large professional following, now approaching 29,000 strong on the founder’s LinkedIn digital rolodex,
including prominent tech innovators and serial entrepreneurs, quantum computing specialists, astrophysicists, award-winning film directors and authors, economists, financial news and geo-political anchors and award-winning media correspondents to high offices.
This investment intelligence and thought-leadership was amplified after
successfully making a series of high-conviction bullish market calls on September 30th, 2022, and reiterating them in finer detail on Oct 6th, regarding an abrupt and anomalous shift of historic market-wide bullish sentiment on and after Oct 13th, 2022,
that would catch many investors – both novice and veteran — by surprise, given both:
the increasing consensus expectations for an economic hard landing and an accelerated market meltdown, premised on the broadscale markers of an unprecedented inversion in the treasury yield-curve; and
the disbelief that the Oct 12th low would be one of the highest valuation troughs in history, at 17X earnings.
Efrem specifically alerting his clients of an imminent and remarkable set of turnaround events in beaten down sectors, industries, and niche segments.
Building on Running Alpha’s traction of nailing the date and price levels of the stealth bull market in equities, that started in October 2022,
many retail and professional traders alike are questioning whether the rally can continue in the key benchmark equity indices in 2023.
Find out now, so you can get positioned, along with your emotional capital, ahead of the next big move.
More specifically, our investing research framework correctly called all 23 watershed turnaround moments in North American and Global Equity Markets, between 2011 and 2022; and now once again it is signaling imminent unprecedented change, including
the volatility that started increasingly gripping the capital markets from around the time of the global trade conflicts late last decade,
to our current post-pandemic re-opening era and supply-chain, energy and food security crisis ( and that’s not including our similar success in other asset classes);
In the 6 days leading up to the Oct. 13th and Oct. 21st turnaround, and the 3 days leading up to the mid July 2022 turnaround,
as well as the May 20th and Jan 28th 2022 price surge, Running Alpha accurately alerted investors of pivotal outlier trend changes, with at least 3 days lead time.
are 23 recent major money-flow calls made successfully by Running Alpha:
Jan 8th/13th/15th/21st/25th/27thand Feb 10th/11th 2016
Nov 4th/9th/16th 2016
Mar 23rd/April 2nd 2018
Dec 26th 2018
Dec 28th/29th and Jan 2nd2019
Aug 14th 2019
Mar 3rd/6th/25th and April 1st/7th/8th/14th/17th/21st/23rd/30th2020
Oct 28th/2020 and Dec 11th/17th2020
Sept 30th and Oct 5th/13th2021
March 11th/14th/15th 2022
May 13th / 16th /20th 2022 – to be announced to clients with premium subscriptions
Nov 29th after-hours / 30th day-session
Jan 6th, 19th, 25th/2023
Spring and Summer 2023 – Discover what’s next with an Alpha Trading Box Premium Subscription
In each of these instances, Running Alpha detected stealth money flows by big institutions in non-listed liquidity pools; and is now once again signaling unprecedented change for 2023.
Consistently and Correctly at odds with the consensus, Running Alpha has also delivered similar foresight in its performance stress-tests,
across over 82 instances, over a 100-year interval of global bullish and bearish modern market history; covering periods of extreme crisis and instability, to more tranquil range-bound and noisy markets.
In this period, the average length of a bear market is 289 days, or about 9.6 months. That’s significantly shorter than the average length of a bull market, which is 991 days or 2.7 years.
40% of the return in a bull market is squeezed on average into 1% (the 10 best days) of a bull market’s duration, which is 991 days (2.7 years).
Stocks lose 36% on average in a bear market. By contrast, stocks gain 114% on average during a bull market. So, it is more profitable trading bull markets passively, but actively trading around core positions in bear markets with higher volatility, offers a higher total return.
That is why we choose to apply our trio of predictive intelligence for invest in extreme reversion events, which have a more defined and measured pathway; offering a faster alpha capture cycle and more frequent opportunities for benefiting from periods of volatility expansion by trading around core positions at strategic price points and time windows and using it as your alpha performance edge.
Since mid October 2022, Running Alpha’s research intelligence has already correctly called all six of these outlier market anomalies to date, giving early notice just before any trend emerged – the most recent being the remarkable upside reversal on Nov 29th after-hours / 30th and Jan 6th 2023 day-sessions for technology stocks and the broad global market indices.
Making things even more challenging, especially for the retail investor is that over 68% of stocks tend to go down in a bull market, with as many as 95% of front-line assets falling in a bear market.
Imagine if you could shrink your risk window by zeroing in on investing in the right corners of the market, just ahead of the best days of each year.
Running Alpha is dedicated to alerting premium subscribers to the coordinates of these actionable opportunity windows.
Data records show that retail investors activity increases when markets are falling, often leading to buying into ‘bull traps,” at those times when volatility is generally higher.
So, unless you have an extreme mathematical edge for overcoming a poor first step into the market, at a time when volatility is expanding, to get your trade-sizing and positioning right, you will need to determine if volatility will continue expanding or start contracting;
and if your strategy involves: managing uncertainty; hedging against market risks; or levering bets on the direction of asset prices, then
knowledge of changes in asset price volatility and optimal expiration dates, that match with the expected duration of the opportunity window, will be even more important.
That is precisely why Running Alpha makes it a high priority to ensure that our actionable alerts and insights are only delivered to you when they are happening inside of a persistent interval of special market states;
specifically, those, where we can apply the fundamental properties of quantum systems for anticipating a powerful asymmetric opportunity advantage –
here the volatility scale to the upside is measurably larger than the downside by several orders of magnitude.
When this edge is combined with our strategy’s, exceptionally high hit rate ( >90% ), we are better positioned for helping you overcome drawdown, particularly during periods when volatility is rising and highly variable.
This strategy also gives us a clear advantage of knowing when to buy into the extreme boundaries, of a volatility expansion, not just because price is moving lower;
but, because volatility changes faster than price, and volatility of volatility changes faster than volatility, particularly in fast moving down markets, where risk averse younger retail investors participate,
it is highly beneficial to have leading indicators that tells you when and for how long these relationships will be reversing.
At Running Alpha, we have several, that we use inhouse, for making informed decisions about when to turn your shopping cart of investing and trading ideas into actionable opportunities that can start raising your anxiety-adjusted returns.
We close the gap between perception and reality by coming to the realization that:
It’s decisions that drive price action; so why, after over 100 years of market observation, are virtually all market-players and technicians still following cycles in asset prices —
which are nothing more than outputs of millions of decision-maker orders coming together as a result of initial decisions and long-memory and short-range feedback processes ) —
for calculating changes in fundamental and macro-market variables,
instead of analyzing momentum cycles in the perception biases of decision-makers, which are the inputs of the price formation process, that only subsequently gets converted, by the orderbook’s function, into what really matters –
the actualized future price action that has a material impact on the most watched fundamental metrics.
With passive investments such as index funds and exchange-traded funds eating everyone else’s lunch, and accounting for the lion’s share (~60% ) of equity assets;
so much of stock buying and selling is now out of the hands of humans, with
the market increasingly sensitive to headlines, and more prone to sharp and often unmanageable swings.
The problem is “not whether passive investing ( buy and hold ) works in theory; it does not work on average in practice,” because:
the people who are making investment decisions, and humans who are relying on machines for generating ground-based risk intelligence,
do not have the fortitude to resist media chatter and market noise ( i.e., data exhaust — redundant data and statistical information mirages ), especially during periods of elevated uncertainty.
For these reasons alone, it’s not too hard to see why only 35% of portfolio managers, who get paid for making decisions on behalf of investors, beat their performance benchmarks.
85% of actively managed large-cap funds underperformed the S&P 500.
In fact, a minuscule 5% of large-cap US funds have outperformed the S&P 500 over the past 20 years through June 2022, according to the S&P data.
Even in stock pickers’ best years, over half of them still lost.
It is even worse when it comes to passive thematic index funds and ETFs, that are mostly copycats, living within the confines of negative space; and
suffering from low active share ( unique holdings relative to industry peers and benchmarks ), poor tracking error, strategy drift, and low liquidity.
These index funds could be easily replicated with simple concentrated stock portfolios, given the all-too-common disproportionate weighting of a few assets, which at times can be unacceptably high, in the order of 20% or more.
Identifying situations when not only prices will be erupting into volatile and fast markets, but also knowing when the quality and sources of risk, underlying price action, are changing as the trade unfolds is what our market intelligence insights is all about.
This is critically important, because if the sources of the risk are not matched with the alpha opportunity generator, the rationale and thesis behind taking on the trade or investment will start breaking down.
So, this serves to inform you as to when you should start pre-empting your investment, and moving on to other opportunities with a more robust mathematical edge.
This will help you know when a weakening trend ends and a new dominant trend emerges, particularly from the perspective of extreme reversion events and trading around some of the most challenging chaotic square wave momentum patterns.
This is a non-subjective exercise; it’s a lesson that should be top in mind of every trader, investor, citizen, and policymaker.
A shout out to all investors — passive and active, novice or masters of the trade — if you are looking for a new angle or mathematical edge that lies outside of classical AI; levering quantum-inspired machine unlearning and computing principles and the science of computational circuit complexity for making sense of natural system expansion and contraction, especially during wickedly uncertain times, the Running Alpha Trading Box™ is for You.
Out of the need for helping the Founder address these challenges and embrace this trusted trading markets wisdom,
Running Alpha’s Idea Grid ( see paragraphs below for how we started out ) was initially born inhouse, which is now repackaged as a two-way real-time trading communication channel, as described on the Access Now section of the Subscription Page, giving actionable trading and investing ideas in plain english straight off my trading desk, with no fluff, just the actionable details and numbers you need to know for getting ahead of the crowd and capturing super-outlier trends before they unfold.
A simple, low maintenance, all-in-one mobile-responsive heat map display for the busy executive on the go; designed for visually exploring, prioritizing, and tracking today’s freshest pipe-line of actionable opportunities, all while raising your capital and strategy efficiency, through assisting you at quickly navigating around value traps in search of best expressing your favorite investable ideas.
Although putting all your eggs in one basket may sound risky, the sheer size and range of high-conviction opportunities to choose from on the Grid gives you the much needed flexibility and peace of mind for customizing and adjusting the size of your basket; breaking you free of capacity constraints and assisting you at accommodating changing volatility conditions.
Efrem is now mobilizing his vision for making the benefits of emerging data science technologies accessible to the everyday investor, for establishing RunningAlpha.com as the premier on-line destination for alpha-idea generation; designed for shock-proofing your portfolio strategy from market noise — while keeping you focused on the right side of key support & resistance levels.
That means eliminating your blind-spots, and making it a snap for converting your pain-points into opportunity; thereby, keeping your wallet closer to your hip and on a competitive playing field with institutional traders.
Tapping into this collective intelligence, Efrem is passionate about rigorously and routinely stress-testing his research framework in the midst of financial hurricanes in equity, commodity, and currency markets; successfully warning investors of the demise of WorldCom, Bear Stearns, Lehman Brothers, GM, among others, before any signs of trouble emerged. On-balance, a review of the much more mixed market settings, scrolling back as far as 400 years across world capital markets, shows similar predictive intelligence.
With uncanny accuracy and specificity, his market calls were also used to help financial traders and investors successfully prepare ahead of the Dot.Com Bust, 2005-07 USA Housing Crash, and the great recession of 2008-09, as well as the subsequent re-acceleration of growth in 2013, that continues to fuel 2015’s USA-focused market rally and global leadership.
Most notable among his Time Mapping Precasts of Wild Sentiment Jet-Stream Behavior, was the Flash Crash of May 2006; telegraphing in magnitude over two months in advance, and striking inside the exact hourly timing window of the anticipated peak tail-risk threat.
One research group inside Running Alpha, known as the Big-Data and Human-Machine Decision Sciences Network, is tasked with the challenge of mathematically sniffing out digital records of market data to look for deep structure that explain the HOW and the WHY of the market’s human social wiring, and specifically quantifying how and when traders — both human and machine — with different market perceptions and time horizons are plugging into the global grid of fear and greed.
Efrem calls this new analytics philosophy, ‘Bottom-Down Intelligence’ – first drilling down to the very first and smallest scale transaction of an individual security, and then digging deeper into:
(i) the underlying motivations and market ecology that are driving trading decisions; and
(ii) the physics of crowd-sourcing multi-speed investor interactions ( Crowd-Physics 2.0 ), that are shaping collective perceptions and interfering with observation measurement of market rhythms, across wide-ranging groups of market securities.
Going beyond conventional behavioral finance strategy that treats emotional biases as the key alpha-generating inefficiencies, Bottom-Down Analytics now makes it possible to unlock a much more fundamental and root source of Alpha, namely: exploiting social intelligence via analyzing trader ecology — knowledge of subtle self-ordered arrangements and relative differences and similarities in the sentiment measurement biases perceived by market observers.
All of us have known traders who become so locked in their views that they stop seeing and responding to what markets are actually doing. Although this may masquerade as “conviction,” it is actually socially unintelligent — not unlike harping on a topic in a conversation and alienating listeners.
Going back to basics — Research shows that we frequently make reference to market sentiment and changes in market character, much as we would speak of another person.
Running Alpha’s Time Maps of the Forward Sentiment Jet-Stream is all about enhancing your Social Trading IQ and leveraging your skills at reading and responding to actions and emotions from the eyes of your competitors; and knowing how to combine this mash-up of market insight for shining a light on the best ideas from among the background noise of what individuals and players around the table think: what they fear, want, value and are willing to bet on. “What results is a truth greater than one man’s opinion.”
Unlike traditional crowd-sourcing and collaborative intelligent systems that focus on interacting with others to harness the collective wisdom of the crowd for generating new and better trading ideas, we apply a counter-intuitive version of crowd-sourcing. How? By peering into the mind-space and perception fields of decision makers, we can unlock the sum non-linear biases and mis-perceptions of the crowd: measurement errors of the total decision-making audience — not just those in the market today, but spanning the decision-making strategy variants that are accessible based on the myriad of ways trends can be observed and measured in the forward versions of today’s marketplace reality.
Whereas traditional Crowd-Sourcing and Prediction Markets need non-gamed information, acquired from locally informed sources, to aggregate as a prerequisite for predicting accurately, Crowd Physics 2.0 is not off-limits to seeing how the web of communication among market players, with limited insights into future events, would respond in the marketplace from the vantage points of their aggregate perception biases.
Embracing this New Standard of Social Intelligence — for Curating Perceptions and Behavioral Experiences from Forward Versions of the Marketplace Ecology to Fit the Local Needs of Today’s Decision-Making Audience — Running Alpha Adds New Context to Crowd-Sourcing; Launching the New Revolution of “Future-Sourcing.”
To analyze, and add meaning and sensibility to this special configuration of market observations, Efrem has formalized a new geometric object, that can now, for the first time, be overlaid on a standard price chart, for putting boundaries around future events, with particular application for helping decision-makers build strategic plans that offer more options for exploiting fat-tailed opportunities in the final moments of decision-making.
How? — By tracing out the sum non-linear-effect of the future Jet-Stream Behaviors of Investor Sentiment Biases, that are simultaneously driving forward price momentum and volatility changes over a broad spectrum of time-lines. The price and time coordinates that house this future shape of market space is nature’s way of efficiently encoding and revealing all relevant information about how different market participants are absorbing and reacting to both new events, as well as their own complex web of open-market transaction activities.
This is important because it opens new ground in economic and financial forecasting, for capturing early insights into critical states that lead to more dramatic expressions of sensitive dependence on initial and evolving conditions — deterministic chaos in scientific parlance.
Although many of today’s leading market research platforms focus on generating heat-maps that give you a global view of tick-by-tick changes in stock market performance indices, they fall short on: (i) delivering an unambiguous forward-looking message; and (ii) offering clues into the evolution of component-level returns, and showing how their cross-correlation among component combinations change over time.
What makes Running Alpha’s Heat Mapping technology different, lies in its usage of a universal mapping function for calibrating heat levels to the shape of these forward Sentiment Jet-Stream Biases; thereby, enabling investors to make consistent apples to-apples comparisons of forward performance and diversification efficiency among component securities.
During those forward intervals when the shape and orientation of the Sentiment Jet-Stream patterns of two or more portfolio components become more tightly coupled, they are said to exhibit an increasing bias for future correlation. For maximum diversification benefits, securities with non-overlapping Jet-Streams should be selected first.
Access to Micro ( weekly horizon ) and Macro Maps ( monthly horizons ), displaying these Sentiment Jet-Stream formations over weekly and monthly intervals, are premium features made available, upon request, for each portfolio component in Running Alpha’s flagship offering of Alpha Ideas: the Grid 100 and Focus 15 service plans.
To advance our capabilities in these areas, for the better part of 18 years, Running Alpha’s founder and Model Architect, Efrem Hoffman has conducted ongoing scientific investigations for addressing the most elemental themes about human market dynamics, namely, personal influence and salience of the decision-making stakeholders, and diffusion and viral propagation of information — that telegraph market contagion; as well as the changing shapes and sizes of social & investor sentiment feedback networks, which gives rise to these attributes. To this end, Efrem’s weapons of analysis have found their home at the intersection of where first principles of Quantum Physics meets the Mathematical of Social Interaction.
a guest speaker on Artificial Intelligent ( AI ) Design and 3D Interactive Visual Decision Support ( VDS ) Applications for trade management in the Spring of 1997, as well as an active participant at an elite private trading tutorial series in Houston, Texas, run by a 36+ year veteran trader and professional behavioral trading psychology coach — instrumental in successfully transforming the science of chaos theory into practice in a live trading room,
(i) discovered at this tutorial by a prominent and extra-ordinarily profitable ex-Chicago floor trading professional in the S&P & Treasury Bond Futures Pits, and later invited to serve as his apprentice in the late 90s — applying unique quant strategies & software design insights in exchange for professional real-life trading instruction on exploiting the inter-market trading book relationships that drive successful speculation in Futures, Equity & Currency Option Arbitrage markets; and
(ii) later introduced in 1998 — by another member of the tutorial — to a celebrity physicist who: (a) won the overall People’s Choice Award at the 1993 Windows World Open, earning a nomination by Microsoft for the Smithsonian Award, after making courtroom history — by developing the first computer model that generated new evidence for a successful defense in a high-profile criminal trial; and (b) studied under the inventor of BASIC computer language, Dr. John Kemeny, and Dr. Winterberg, a student of Albert Einstein and Heisenberg, respectively; and (c) periodically served as Efrem’s trusted software design and numerical modeling mentor and scientific colleague from 1998 to 2005.
Entrusting these experiences with passion and dedication for helping people connect the dots and think through alternative solutions, Efrem makes it his business each and every day to launch deep theory into live trading practice.
In the spirit of the former Hedge Fund Superstar, Curtis Macnuyen, Efrem is passionately absorbed in putting his Running Alpha Intelligence Engine to work for you in:
“Finding Truly Epic Trading Setups, Where You Have To Be a Little Bit Right To Make A Lot Of Money And A Lot Wrong To Lose A Little Bit Of Money.”
Well connected to the Bay Street Community in Toronto, Canada, Efrem regularly provides active research counsel to boutique portfolio managers and preeminent independent value-oriented investment research firms that are grounded in deep physics and forensic analysis of balance sheet valuations. Combined with expanding international interests from wealth management practitioners outside of Canada, Efrem’s contributions and networking opportunities in the quantitative financial services sector are building on his 18 years of enterprising knowledge in the domain of Mathematical Physics, Behavioral Finance, and Quantum Decision-Making.
Efrem hopes that with his company, he can play an inspirational role in helping investors and business executives have pain-free experiences on their journey toward better decision-making.
His vision is to see Running Alpha as a leading part of a story for rethinking the way we can collaborate with nature, to better exploit uncertainty, and compensate for the human condition and machine biases that get in our way of both perceiving world events in high-definition and making bold decisions with attention to detail.
When Efrem is resetting his trading psyche for the next day’s Battle for Investment Survival,” he shares his time between letting off steam at the gym and Varsity track, and celebrating his life with his best friend — and wife of 18+ months.
The Bottom Line to Efrem’s On Going Research is:
- The events we perceive as ordinary every-day occurrences are actually born out of the background noise of prior crisis and unusual market aberrations.
- Thus by focusing on the rare 1% Outliers rather than eliminating them, the agenda is to gain clarity on the 99% of market pressures that influence decisions each trading day!
- New Perceived Risk & Capital Asset Valuation Framework, founded on Leadership Rotation of Asset Class Rankings delivers:
- Portable, Low-Cost Tail-Risk Solutions for Professional Managers looking to
- “Hedge-For-A-Profit” in All-Volatility Environments with Absolute Alpha.