Meet Geoffrey Fouvry, our MacroAdvisor EDGE Economist

We've actually worked together for over a year, so this is kinda a late announcement ;-)

Meet Geoffrey Fouvry

Geoffrey is LaDucTrading’s MacroAdvisor EDGE classical economist. He shares his unique insights with our clients on how policy affects rates, inflation and US & world economies, as well as the trades that support them. His timing on bonds, precious metals and currency moves are stellar, while able to explain the global markets from a view grounded heavily in classical economics and historical precedents.

He has managed capital as Head of Research for the Lion Fund Ltd, with a 15-year tenure at York Asset Management, focused on risk arbitrage and special situations as well as Emerging Market bonds. Geoffrey’s buy-side approach to research combines an investment process that balances very long-term view on where we are in the current monetary system with a bottoms-up industry/company fundamental analysis. 

Geoffrey’s approach to finding biases and errors in the market view that are contradicted by solid data, accounting forensics, and shareholders’ positioning enables him a unique ability to see real downside risks, rather than conventional metrics of volatility that can hide systemic risks.  His portfolio tends to be concentrated. 

Our EDGE members rely on Geoffrey’s curated macro insights on both risks and opportunities, as well as the trades he shares that manifest his unparalleled value analysis. 

Check out this Background Q&A with our client-dedicated, cutting-edge, classically-trained MacroAdvisor EDGE contributor & partner:

Analyzing Financial Markets

Tell us a little about your background.

I started my career sitting as an intern at PaineWebber New York in the Fall of 1999. My mentor, a British gentleman from Oxford law, trained me entirely on risk arbitrage, special situations, and event-driven investing. He did syndication of Emerging Market bonds in the 1970s at Sumitomo, and that’s where the lineage comes from on understanding fiscal dominance. It was initially very legal-oriented, and I thought I was wasting my time learning antitrust economics.

How wrong I was—the solid antitrust economics helped me detect in 2003 a company that would become an incredible investment. We had an order in the IPO of Mastercard because we knew from the FDC-CE merger that the business was a duopoly with stratospheric abnormal profits.

I had a great opportunity to train my bottom-up skills during those years, with long trainings in accounting, banking analysis, and valuation methods (liquidation value, replacement value, SOTP, spin-off, earnings power, and finally sometimes DCF—not the favored one). The EM bonds market background obviously helps me a lot today. The one thing I regret is not having trained enough in insurance and re-insurance (very difficult).

In 2008, my team and I made money—not a lot (2%) but comparatively strong against most funds. That’s when I realized that I was shunning bad assets more on gut and common sense (Florida banks, real estate trades were absolutely forbidden, and we went for super conservative arbitrage situations).

For the next three years, I simply locked myself in my reading room on weekends and read all the classical economics and archives I could get my hands on, and that’s where my macro skills, grounded in classical economics combined with credit/banking cycle analysis, emerged.

“Samantha has a knack for inflection points”

What do you like about working with LaDucTrading?

Samantha has a knack for inflection points—it’s a totally different approach than mine. It baffles me, but she DOES catch those inflection points very effectively, and it makes me rethink my positioning to understand if I missed something and avoid trouble in U.S. markets.

What I particularly appreciate is the ability to defend “uninvestable/outrageous trades” that turn the market consensus upside down. It can be a special situation Eurobond of a Ukraine company in H1 of 2024, a very heavy silver position, a very large long China allocation, or a short bond position. Or simply warning on JPY short fallacy. Most Wall Street firms have the “dissident hunt” mentality, where it’s very difficult to tell that the market is making a mistake. LaDuc doesn’t.

“Damn, these people know a lot”

Why do you think clients like working with LaDucTrading?

I think they hear things they can’t get elsewhere. I am more focused on longer-spectrum trades, but I do believe that Samantha has a flair and methods for market direction that are far above average.

On the historical macro side, I get a lot of feedback like, “I had no idea things were originating from this or that previous set of historical circumstances. I had no idea it worked like that.”

And they can see the results. The education is not easy, and sometimes we go into very advanced topics on central banking, monetary mechanisms, or simply banking and accounting forensics, but when the client feels like “damn, these people know a lot,” they are usually happy at the same time.

“I see my job as detecting errors and common biases”

What is one takeaway every investor should think about?

I think traders need to know where they are in the bigger picture.

Are they in monetary dominance, fiscal dominance? What are the systemic risks, and where are they? In commercial banking, at the level of the central bank, at the level of the Treasury?

I see my job as detecting errors and common biases that are popular in the market. I used to tell my analysts, “When you watch a Bloomberg terminal, beware of not being a dog barking at the image of himself in the mirror.”

So, know the biases, know the prevalent psychology, and understand where there could be errors that you could profit from.

Get the EDGE

Our mantra at LaDucTrading is to help clients POSITION, PROFIT AND PROTECT. We help you profit from our stellar track record of market-timing calls AND protect in periods of market volatility. Learn more about EDGE membership – and working directly with Geoffrey, Hans and Samantha – by joining us here.