You can watch Julie Segal's conversation with Ken Tropin on YouTube. 

Between 2010 and 2020, a period many hedge funds call the ‘Alpha Winter,’ the Federal Reserve, the European Central Bank, and the Bank of England made only 22 quarter-point-equivalent interest rate moves. Fixed income and macro traders had little volatility to work with for those 10 years. Since 2021, global central banks have made more than 80 interest rate changes in response to inflation, war, and spiking energy prices, among many other things. Now traders have four times as many potential opportunities to make money.

On In Conversation with Julie Segal, Ken Tropin, chairman and founder of Graham Capital Management, says the volatility and uncertainty hanging over markets also makes it much more difficult to have conviction. That requires his portfolio managers to trade smaller positions more tactically, “match risk to conviction,” and remain open to having misunderstood an unfamiliar environment. Tropin, a former sculptor who launched Graham with the backing of Paul Tudor Jones three decades ago, has continually made changes so his firm could adapt to markets that never behave as expected. 

The challenges for institutions are many: a single factor, AI, driving markets and bonds’ diminished role as a diversifier. 

For institutions, macro funds can provide uncorrelated returns. But, says Tropin, “Don’t think of me as a hedge. Think of me as something that should provide diversification over some number of market cycles.”

Listen in to Julie Segal’s full conversation with Tropin, Institutional Investor’s 2026 Hedge Fund Lifetime Achievement Award winner on Spotify, Apple or wherever you get your podcasts or by clicking below.