David Marra, a pioneering figure in quantitative asset management and Head of Research & Portfolio Management at Markin Asset Management. With over three decades of experience, David is renowned for his innovative approach to finance, leveraging AI to enhance investment strategies. His expertise extends beyond fund management, with a background in founding a quant research firm and providing strategic counsel to industry leaders. With a knack for simplifying complex concepts, David is trusted for his ability to make finance accessible to all.
Episode Highlights Here:
David
I think you know, an investor is really looking for alpha, something that gives them a better return relative to the unit of risk that they’re taking. And I think the Alpha opportunity is outside of those stocks primarily in the wave of stocks that are now implementing AI in their businesses.
Brett
So David, what’s the number one secret when it comes to investing in the next wave of AI stocks.
David
So what we think is there’s AI stocks, and then there’s investing in the AI phenomenon. And what we think is that if you look at the, you know, the stocks, we had the run up a few months ago in the stocks like Nvidia, and Google and Microsoft and other firms that really are on the cutting edge of creating the infrastructure, in terms of chips, in terms of data centers, and compute, that, that power, these AI, this next generation of generative AI algorithms, and those talks have had a huge run up, right. And there’s, there’s, there’s a, there’s a dozen of them, or so that are really deeply tied to the plumbing, they make the pipes and the plumbing of artificial intelligence just can’t happen without the chips and without the computer, the data centers, etc. But that much of that growth now is already priced in the markets figured out where AI is going, a lot of that growth is proceeding priced. And I’m not saying it’s all priced in, but a lot of it is, I think, you know, an investor is really looking for alpha, something that gives them a better return relative to the unit of risk that they’re taking. And I think the Alpha opportunity is outside of those stocks primarily in the wave of stocks that are now implementing AI in their businesses. So if you look at the Russell, you know, 1000, you can identify 50 to 100 stocks, just what we’ve done, that are going to benefit the most from the current generation of generative AI. And they’re going to benefit by that through higher earnings per share, which is going to come either through faster growth right on the sales side, and or more productivity from their people, less need for people cost reduction on their own cost side. And we think there’s just a tremendous amount of opportunity for certain firms given their structure, given the types of jobs that they employ people at the type of tasks those people do, those those those people do, and the volume of those tasks and jobs kind of multiply by each other. And when you look at that, and you do that analysis, you know, we’ve developed an investment strategy. That’s the next wave of artificial intelligence, meaning these are not firms. This is a sector. These are not firms that are in just the tech sector. They’re in every sector. In fact, we made our strategy sector neutral. And this is what Google is selling to this is who Nvidia is selling to the people who are going to use these chips to drive their earnings. So we think that’s the next biggest potential because so much is already priced in, in the stocks that make the underlying infrastructure.
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About David Marra
David Marra, a trailblazer in quantitative asset management and a distinguished fund manager, stands at the forefront of financial innovation. Currently, as the Head of Research & Portfolio Management at Markin Asset Management, David’s expertise transcends traditional methods.
He is also at the forefront of utilizing AI to enhance investment strategies. With a career spanning over three decades, David has cemented his reputation as a trusted figure in the financial world. He is recognized for his ability to demystify complex investment concepts, making them accessible to clients and allocators alike. David’s influence extends beyond his role as a fund manager. Prior to Markin, he founded a quant investment research firm serving institutional managers, and as a Principal at The Boston Consulting Group (BCG), he provided strategic counsel to Clevel executives at top-tier asset management and pharmaceutical firms.
In his earlier career, David was the Founder & CEO of a search engine technology firm, overseeing a team of over 70 machine learning researchers and technologists. David received an MBA from the University of Chicago’s Booth School of Business, where he was a Fellowship recipient and was fortunate to have had several lecturers who have received the NobelPrize in Economics.
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