ThinQ Decisions’ Post

It is an absolute tragedy that we have internalized this capitalist myth that if the over 8 billion people on this planet had greater access to our own models, frameworks, and ideas, that magically the earth would reach some kind of global enlightenment that would give rise to planetary harmony. When in reality, things only actually shift with the tedious work of central planning and immense amounts of dedicated daily labor.  Our offerings are may change some behaviors here and there, sure. But in participating in this market exchange for ideas, we are participating in the same exact system we believe we are attempting to counter. The "ROI" is minimal compared to the immense amounts of energy required to truly shift global systems. And a harsh reality is that we may be unintentionally taking away from the massive energy required for collective action by convincing others of adopting the easy living alternatives in our own models.   Absolutely, we must participate in market economies, in our current capitalist system, to survive. We can market and sell our frameworks as part of these exchanges. But to market them as liberatory interventions in our capitalist system is a exercise in corporate propaganda.  This is the mentality we must adopt to confront the reality we are in. That we will not avert human civilizational collapse with better types of consumerism, feel good consumerism, but an unfathomable reduction of it. 

Target Date Funds: the view from France https://lnkd.in/g2cUD9Sh In 1996, index funds represented 6% of US equity fund assets. By 2025, this figure exceeded 60%. In Europe, ETFs attracted a record €337.5 billion in 2025 alone, according to Morningstar, bringing total assets under management to €2.72 trillion. Alas over ten years, barely one in five outperforms its benchmark index. End of discussion. Except that an academic paper, authored by Xavier Gabaix (Harvard) and Ralph Koijen (Chicago), raises a question that the consensus prefers to ignore: what if this mass of money on autopilot is mechanically distorting prices? Their "inelastic markets hypothesis" rests on an empirical observation: when an investor injects $1 of fresh cash into stocks (by selling bonds, for example), the total market capitalization doesn't increase by $1, but by about $5 (within a range of $3 to $8 depending on the specifications). The classical model predicts the opposite: prices reflect the present value of future dividends, and an inflow should change virtually nothing, since rational sellers would take the counterparty. In practice, these sellers are rare. This is where the mechanics become interesting for anyone advising on asset allocation. Target-date funds, which automatically allocate between stocks and bonds based on the saver's retirement date, now capture 64% of retirement contributions in the United States, according to Vanguard . Each monthly contribution from a 35-year-old American employee feeds an equity allocation to the tune of 80-90%, without any fundamental analysis influencing the decision. If Gabaix and Koijen are correct, this regular flow inflates the capitalization by several dollars for every dollar invested, regardless of the companies' profit prospects. A client who invests €500 per month in dollar-cost averaging (DCA) on an MSCI World ETF participates, on their own scale, in the same mechanism. The point isn't to revive the active/passive debate (that's settled by fees and performance). It's to understand that an asset's price and its fundamental value can diverge significantly when the majority of cash flows are no longer price-sensitive. A wealth management advisor constructing a 60/40 allocation using ETFs must integrate this reality: the decoupling between cash flows and fundamentals creates a potentially brutal mean reversion risk the day redemptions reverse. US target-date funds nearing maturity are already experiencing massive outflows ( Vanguard Target Retirement 2025 saw $6.7 billion in withdrawals in the first ten months of 2024). The question isn't whether passive management is rational for the individual saver—it is. It's about measuring what happens when individual rationality, aggregated on a trillion-dollar scale, produces a collective effect that no one has calibrated.

Markets, geopolitics and policy decisions remain closely intertwined, making the investment landscape increasingly complex to navigate. In our latest webinar, Back to School: The Market and Geopolitical Outlook Ahead of the US Midterms and Beyond, Daniele Antonucci, Head of Investment & Chief Strategist at Quintet, joined John Emerson, Vice-Chair of Capital Group and former US Ambassador to Germany, to discuss the key economic, market and geopolitical developments shaping the months ahead. Their conversation explored how investors can make sense of a rapidly evolving environment, from shifting political dynamics to their potential implications for global markets and long-term investment decisions. Watch the full recording here: https://lnkd.in/ec3Wib33 Investing puts your capital at risk. #Investing #Geopolitics #USMidterms

Do you think the business of generating content is dead? Here's proof that high-quality content will prevail. A while ago, I flew to Shanghai to meet a man almost no one in the West had heard of. Nearly a decade running the same strategy. Beating his benchmark the whole way. And outside China, a near-total stranger to the allocators who'd have lined up for those numbers if they'd known him. The track record was extraordinary. What was missing was a way for an outsider to believe it, to verify it, benchmark it, and carry it into a committee room without staking their own credibility. Capital doesn't get stuck on returns. It gets stuck on trust. So we built the thing trust runs on. A full 30-page independent analysis, benchmarked against the major indices and a real peer group. And then I sat across from the founder for a day, because you can't read a person from a fact sheet. What I didn't see coming was what my client did with it. He turned the analysis into a business asset. He fed the report into an AI system that now answers DDQs on its own. The research didn't lose to the machine. It became what the machine had to say. That's the part everyone misses in the rush to automate: you still have to go. Someone still has to sit in the room, to analyse and to verify. Influidence goes beyond the desk uncovering and conducting thorough analysis of fund managers and companies, always with one focus: serving the client as well as we can, so the work creates value for everyone involved. If you're a strong manager who stays invisible to international capital, leave a comment and I'll reach out directly. To learn more about how this manager turned our work into a business asset, read the full case study below. #ChinaEquities #ManagerSelection #Influidence #AssetManagement

Catastrophic Supply Chain Risk of Failure in the "O-ring" Economy From the The London School of Economics and Political Science (LSE) Speaker Series (23+ minute listen) Lazard CEO/Chairman Peter Orszag sees a new supply-side era taking shape, in which supply shocks are increasingly geopolitical and rooted in the physical world that are displacing demand as the dominant source of macroeconomic variance. This is not the supply chain of the 1980s: the binding constraint of future supply chain risk is now coming from the physical and network interdependencies that a generation of globalization has created. Following UChicago economist Michael Kremer's "O-ring logic", a single missing input can halt production and/or cause catastrophic supply chain failure - which is why these shocks work through the economy both immediately, and then continue slowly and unevenly, surfacing in price and supply shocks months or years later. Policymakers, CEOs, and Chief Supply Chain Officers must adapt their thinking to this new era. https://lnkd.in/ejAh4Yjz

What I found most interesting in six months of live performance from PSIMON's Regime Intelligence engine wasn't the average return. It was the discipline. The engine stays patient when it's right and acts quickly when it's wrong — staying twice as long with the winners. That's the layer that is difficult to consider in pure fundamentals work. Conviction on fundamentals tells you what to own, while regime intelligence tells you when a conviction has quietly shifted underneath you — before price confirms it. For a PM managing a concentrated stock portfolio, this isn't about trading more. It's about catching the small position adjustments that matter: leaning away from a holding entering a risky regime, scaling up one entering an attractive one. Most weeks, the right call is to do nothing. The point is to know which weeks aren't. https://lnkd.in/e8FSb2DE

Flying in from Japan for our recent Foreword events, our Chief Economist and Chief Global Strategist Naomi Fink shared her views on the evolving global economy, the AI investment boom and the role of diversification in today's market environment.

Reposting this blog post because it hits on something I see often with investors lately: When markets get noisy, the instinct is to do something. But the real edge is often in doing less—just more intentionally. 👉 Diversification still works 👉 But how we define it is evolving Value investing is a great example. It’s no longer just about “cheap”—profitability matters too. And zooming out: A tiny fraction of companies drive most market returns. Miss them, and results change dramatically. That’s why staying broadly diversified—across regions, asset classes, and drivers of return—still matters more than ever. Discipline > reaction. Worth the read 👇 #Investing #Diversification #ValueInvesting #LongTermInvesting #PortfolioStrategy #WealthManagement #FinancialPlanning #BehavioralFinance