Farouk Jivraj - The Art & Science of Using Alternative Risk Premia (S7E12)

In this episode of Flirting with Models, Corey Hoffstein interviews Farouk Jivraj, Portfolio Manager and Head of Alternative Risk Premia at Fidelity Investments, about building an alternative risk premium platform. Farouk discusses his background, contrasting sell-side and buy-side experiences, and highlights the importance of long-term investing and psychological management of portfolios. He shares Fidelity's core objectives for its alternative risk premia offering, emphasizing thoughtful research, diversification, and proactive evolution. The conversation explores strategy selection, portfolio construction, and ongoing management, detailing a five-step process: specifying objectives, premia selection, strategy selection, portfolio construction, and portfolio management. Farouk also discusses the trade-offs between accessing strategies through swaps versus in-house replication and the importance of diversification while meeting specific objectives.