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How’s it going, everyone? Today, we’re covering an interview Lincoln Archibald had with Bob Elliot, founder of Unlimited, about strategic investing.
Unlimited uses machine learning to create low-cost index replications of 2&20 style alternative investments like hedge funds, venture capital, and private equity.
Let’s dive into the “Funds that Won” interview!
The Journey To Unlimited
Lincoln: Bob, it’s great to have you! Give me the elevator pitch on Unlimited!
Bob: I’ve spent 20 years of my career working for systematic investors of 2&20-style investments. I was at Bridgewater Associates for 15 years, which is known as the world’s largest hedge fund. Additionally, I spent some time on the venture side, running a systematic venture fund.
I realized that the 2/20 structure is better for the manager than the investor, yet it is so common. I wanted to solve this problem: how do you simultaneously increase access to alternatives and lower fees? We soon realized that implementing technology could ultimately help us lower the cost for investors.
Comparing Unlimited to ETFs and Mutual Funds
Lincoln: What’s the difference between your fund and an ETF or mutual fund?
Bob: We have one public ETF that functions like a low-cost index fund, and we run our other funds privately. For our institutional investors, we switch between certain strategies based on the macroeconomic environment.
Lincoln: How much are you managing for each product?
Bob: The ETF has been around for only 18 months and has $40+ million.
The Genesis of Unlimited
Lincoln: Great! Let’s take a step back. How did you get this all started?
Bob: Starting out of college, I was a botanist. Although this has nothing to do with business, it made me realize that macroeconomics plays a big part in botany and other parts of our everyday lives. I went to Bridgewater, not with the intent to earn money, but to learn more about the macro landscape.
There, I fell in love with markets and macroeconomics. I found it interesting that the economy is a large system that we need to understand. I also saw the value of systems and the need to implement them.
Applying Systematic Approaches to Investing
Lincoln: So, how do you apply a systematic approach to investing?
Bob: We look at the performance of hedge fund managers and where they’re positioned in the market, and we try to calculate their success. Instead of using discretion to look at the returns of fund managers, we predetermine what is good and what is not, and we write down the numbers. So, we’ve created disciplined technology that replicates successful fund managers.
Conclusion
That’s all we’re covering on the podcast, but click here to listen to the rest! If you want to learn more about strategic investing, visit my YouTube channel! Or, if you want help starting your own fund, visit Fund Launch!
Thanks for stopping by,
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DISCLAIMER: This content is for educational and informational purposes only. It is not to be taken as tax, financial, or legal advice. You should always consult a legal professional before taking action. Furthermore, this is not a recommendation to buy or sell any security. The content is solely just the opinion of the author
