2025 Munich Finance Forum (MFF) Summary

2025 Munich Finance Forum (MFF) Summary

The 2025 Munich Finance Forum (MFF) proved once again that finance conferences are where insight goes to die. A parade of credentialed voices served up the usual cocktail of Eurocentric pessimism, stale geopolitics, and safe platitudes. Exactly the kind of groupthink that keeps Europe comfortably behind the curve.

What was missing? Many mental models and hard-won philosophies that actually help investors survive:

• Buffett’s “margin of safety” and the humility of staying within a circle of competence.
• Graham’s reminder that “Mr. Market” is a manic depressive, not a guru.
• Munger’s latticework of mental models and his brutal inversion: avoid stupidity before chasing brilliance.
• Taleb’s insistence that Gaussian curves are delusions…risk lives in the fat tails.
• Marks’s second-level thinking and obsession with cycles.
• Dalio’s debt mechanics.

Instead, attendees were treated to the empty calories of resume recitations, vague ESG pieties, and defensive self-flagellation about Europe’s decline. Not a word about compounding, probabilistic thinking, or behavioral traps. No real frameworks, no solutions, no edge.

In short: lots of suits, zero substance. Munich Finance Forum 2025 will be remembered (if at all) as the conference where everyone talked, and no one said anything.

First Speaker

To kick it off the first speaker was Dr. Nicholas Gartside, the Chief Investment Officer and member of the Board of Management at Munich Re since March 2019.

Speaker Background

• Nicholas Gartside: Chief Investment Officer and Board Member at Munich Re since March 2019
• Education: B.A. in History and Politics from Durham University (1996), M.Phil in International Relations from Cambridge University (1997)
• Career: Started at Mercury Asset Management, then Schroder Investment Management, J.P. Morgan Asset Management before joining Munich Re
• Manages approximately €250 billion in insurance assets for Munich Re

Main Topic: "Is This Time Different?"

The presentation addresses whether current market conditions represent a fundamental regime change or merely a continuation of historical patterns.

Key Themes and Arguments

1. Historical Context and Market Cycles

• References Sir John Templeton's famous quote: "The four most dangerous words in finance are 'this time it's different'"
• Emphasizes that while "history does not repeat, it rhymes" - certain patterns resonate across time periods
• Stresses the importance of identifying genuine "regime changes" (e.g., Bank of England's long-term interest rate shift)

2. Interest Rate Environment

• Predicts that "we are not going back to low and negative interest rates in the UK"
• Foresees "interest rates will remain higher, and less interest rate cuts (even in USA)"
• Expects "mild stagnation" where growth will be higher but struggle

3. Market Psychology vs. Fundamentals

• Short-term markets driven by "animal spirits" - fear and greed
• Volatility affects both fixed income and equity markets
• However, "fundamentals always matter" and eventually reassert themselves
• Uses examples: USA tech/media/telecom forward P/E ratios and USA IG corporate spreads
• Conclusion: "Bubbles eventually burst"

4. Current Market Valuations

• Despite excitement in the US tech sector, P/E ratios are "not that high in aggregate"
• Fixed income spreads in the USA are "not that different"
• Suggests current market may not be in bubble territory despite concerns

5. Investment Philosophy and Framework

• Core principle: Match assets to liabilities (both for insurance and personal investments)
• Emphasizes diversification: "The best kept secret in finance is that diversified portfolio does work"
• Munich RE believes in "consistent active asset management"
• Focus on long-term investment horizons to benefit from compounding

6. Current Market Analysis

• Yield curve steepening and regulatory changes
• Lower demand for longer-dated bonds
• USA recession risk assessed at 15%
• 77% of companies beat Q2 estimates
• Expectation of Fed rate cuts with potential ECB divergence
• Ongoing inflows into USA, UK, and Japanese equities

7. Private Markets

• Munich RE has invested in private markets since 1897
• Notes the evolution of annual reports from 4 pages (1880s) to 300-400 pages today
• Private markets can provide "complexity premium"
• Important to match assets with liabilities over the long run

8. ESG and Sustainable Investing

• Views ESG as representing a "regime change" with timeframes of 10+ years
• Munich RE owns significant forest assets (largest holder) with 4% yield
• Committed to portfolio decarbonization but questions "real world impact" when assets are sold
• Believes in long-term consistency on climate change despite shifting political narratives

Q&A Session Highlights

Risk Management Philosophy

• Question about Munich RE's seemingly conservative asset approach compared to Warren Buffett's philosophy
• Response: Different philosophy - European approach is more conservative and cautious
• Risk capital comes equally from insurance and asset sides (50/50 split)
• They believe they take "a decent amount of risk on both assets and insurance"

Regime Change Impact

• Question about how regime changes affect markets
• Response: For equity markets, real interest rates matter more than nominal
• Higher interest rates negatively impact growth stocks that discount future earnings
• Many investors think in nominal terms, which has psychological impact

Climate Investing

• Munich RE remains committed to climate solutions despite political shifts
• Believes in long-term consistency and real-world impact
• Will maintain investments in renewable energy and sustainable assets

Market Irrationality

• Identifies potential irrationality in:
  • Tech sector (needs real earnings from cash flow)
  • Parts of private equity (flipping companies in 5-7 years)
  • Credit markets (spreads are tight, suggesting complacency)
• Warns about potential return of capital controls in a changing policy environment

Role of US Treasuries

• Sees continued dominance of US Treasuries due to lack of alternatives
• Positive on German bonds (expects €1 trillion issuance)
• Expresses concern about protectionist policies and taxation issues

Sustainable Asset Management

• Focus on sustainable forest management with proper certification
• Cautious about nuclear energy due to financing and decommissioning challenges
• Prefers water and electricity assets with clear regulatory frameworks

Key Takeaways

This presentation reflects Munich RE's conservative yet active approach to investment management, emphasizing the importance of matching assets to liabilities while navigating what appears to be a genuine regime change in global financial markets.

Second Speaker

The second speaker with one Power Point slide presentation was Professor Dr. Klaus Schweinsberg, a professor at ESCP Paris and European School for Management and Technology (ESMT), Chairman of the Centre for Strategy and Higher Leadership, and has served as a Colonel in the German Armed Forces (Bundeswehr) General Staff for over 30 years. He is also associated with HSBC Germany and is a published author.

Speaker Background

• Professor Dr. Klaus Schweinsberg: Professor at ESCP Paris and ESMT Berlin
• Military Background: Colonel in German Armed Forces (Bundeswehr) General Staff Service for over 30 years
• Professional Roles: Chairman of Centre for Strategy and Higher Leadership, Director of European Center for Digital Competitiveness
• Business Experience: Supervisory board member of HSBC Deutschland and Haufe Group SE
• Author: Multiple books on business ethics, corporate governance, and system change
• Media: Former editor-in-chief of CAPITAL and IMPULSE business magazines
• Education: PhD in Economics, studied at universities in Fribourg, Siena, and St. Andrews

Main Topic: "Post-War, Post-Wall, Post-West" Security Policy

The presentation addresses whether we are entering a pre-war period and what this means for European security and defense preparedness.

Key Themes and Arguments

1. Current Security Situation

• Believes we are in a pre-war period: "Pre-war are we in it? He thinks we are in one"
• Three major threats to Europe: Russia, China, and USA form a "coalition of the killing" that seeks to destroy Europe
• European response needed: France and Germany must form a "coalition of the willing" to counter these threats
• Critical question: Who will be the "coalition of the billing" - who will pay for European defense?

2. Current Security Challenges

• Cyber threats: Daily attacks from Russia, including cut cables, spying, and drone incursions
• Military exercises: Russia blocking satellites and potentially reading data during exercises
• Infrastructure vulnerability: Critical gaps in German military and civilian infrastructure

3. The "5 Ms" Framework for Security Preparedness

Schweinsberg presents a comprehensive framework using five key elements:

M - Monetary (Financial Resources)

• Russia has significant purchasing power ("kaufkraft")
• China has massive purchasing power with 10% growth and big material investments
• USA has the largest economy, Germany lower, Ukraine nominally lower
• Germany is the only country making significant investments in Ukraine support

M - Material (Military Hardware)

• Russian production: 1,500 tanks per year (refurbished/produced) - more than EU combined
• Artillery gap: Russia produces 6 times more artillery than USA
• German production limitations: Rheinmetall at maximum output but still produces less per year than Russia makes in artillery munitions per month
• Chinese military buildup:
  • Expanding nuclear arsenal from 250 to 1,000 atomic bombs
  • World's largest air force and navy
  • More aircraft carriers and amphibious landing craft
  • Clear preparation for Taiwan conflict

M - Mass Data (Information Warfare)

• Ukraine's advantage: Within 90 minutes, can process satellite target data with 20 personnel
• NATO disadvantage: 600 personnel need 3 days for similar target processing
• AI gap: Palantir and American systems are much faster; Germany won't match this gap
• Critical insight: "Ukraine only survived because of speed of data and compute"
• Need for regime change in thinking: "We must pull the future back into the present"

M - Menschen (Personnel/Human Resources)

• Training gap: Need 5-6 years to train a normal infantry soldier vs. Ukraine's 3-week tank driver training
• Personnel shortage: Need 500,000 soldiers but don't know how to reach them due to data protection laws
• Driver shortage: Need mass production of qualified drivers for military logistics
• East-West mindset gap: Eastern population has mindset to contribute; Western population lacks this

M - Mindset (Cultural/Psychological Preparedness)

• Biggest problem: Need resilience and strength mindset
• Historical perspective: Current situation is "normal" and the last 50-60 years were not normal
• Procurement culture: German system designed to do nothing due to bureaucratic processes
• Excellence obsession: Need to move away from excessive focus on perfection at the expense of capability

4. Taiwan Conflict Analysis

• Chinese capability: Now has capacity and capability for Taiwan action
• Xi Jinping's timeline: "In my lifetime" - serious threat very soon
• Most likely scenario: Sea blockade rather than full invasion
• US response uncertainty: Depends on political leadership (Trump factor)
• Regional balance: Japan, USA, Philippines, and South Korea have more soldiers than France, Germany, and UK combined

5. Critical Defense Investment Needs

• Immediate priorities: Artillery, anti-aircraft systems, sensors (especially satellites)
• Drone warfare: Need mass production capacity; innovation cycles are 2-3 weeks in Ukraine
• Standardization: Need to standardize core systems; current complexity with different munition types won't work
• Logistics: Not just military equipment but field kitchens, 3D printers, bottled water, and comprehensive logistics
• Hybrid warfare: Mix of archaic "blood war with bayonet" and high-tech warfare

Q&A Session Highlights

Timeline for Conflict

• 2029 timeline: Putin needs time to restructure army, currently busy with Ukraine
• Baltic threat: As important to Putin as Ukraine; easier to reach the sea
• Preparation window: 1-2 years to respond to provocations
• Testing patterns: Poland drone incident was a test of NATO response time

Defense Production and Innovation

• DARPA-like agency needed: For drone reaction technology
• Production gap: Problem is not research but production at scale
• Ukrainian approach: "Copy with pride" - willing to share knowledge
• German research imbalance: More investment in Max Planck institutes than defense R&D

Mindset Change and War Prevention

• Confrontation needed: Must confront threats directly, not just forward problems
• Corporate engagement: Need more motivation and engagement from German companies
• Pacifist challenge: Can mindset change help avoid war? Possible but requires direct confrontation

Infrastructure and Capability

• Chinese dependency: Many critical parts sourced from China
• Infrastructure decay: Tunnels too small, bridges can't carry military weight
• Testing capability: Need to test military capabilities and infrastructure resilience
• Responsibility gap: Have money but no clear responsibility for modernization

Key Takeaways

Churchill Quote (Closing)

"All EU maybe free and the life may move forward…but if we fail all the world will sink…" - Churchill 1940

This presentation represents a stark warning about European security preparedness, emphasizing Germany's critical role in defending against what Schweinsberg sees as an imminent pre-war situation requiring urgent, comprehensive action across all domains of national power.

Third speaker

The third speaker was Dr. Martin Lück, the founder and Managing Director of Macro Monkey GmbH, with an impressive background as former Chief Strategist for the DACH region at BlackRock and Chief Economist for Germany at UBS Deutschland.

Speaker Background

• Dr. Martin Lück: Founder and Managing Director of Macro Monkey GmbH (founded late 2024)
• Previous Experience:
  • Chief Strategist for DACH region at BlackRock (8 years)
  • Chief Economist for Germany at UBS Deutschland (8 years)
• Education: Banker apprenticeship, Economics degree in Hannover
• Experience: Over 30 years in financial industry as economist and capital markets strategist
• Company Focus: Macro Monkey provides analysis and consulting for macroeconomics, capital markets, and geopolitics

Main Topic: "Die neue Welt(un)ordnung. Kapitalmärkte im Spannungsfeld von Geopolitik und Handelskrieg"

(The New World (Dis)Order. Capital Markets in the Field of Tension between Geopolitics and Trade War)

Key Themes and Arguments

1. Current Economic Outlook

• USA Stagflation: Likely scenario with low growth but avoiding deep recession
• Inflation Trend: Inflation is rising and likely to continue upward due to import prices and manufacturing costs
• High Uncertainty: Uncertainty index very high, leading to reduced investment
• Stagnation Scenario: Slow macro growth with increased inflation - classic stagflation
• Market Impact: Both stocks and fixed income falling simultaneously; algorithms not configured for this scenario

2. German Economic Crisis

• Industry Crisis: German industry severely impacted by Russia war and energy crisis
• Energy Dependency: German industry requires large energy inputs, making it particularly vulnerable
• China Relationship Shift:
  • Previously strong export coupling with China
  • Now Chinese are not buying German products but trying to sell to Germany instead
• Business Climate: Ifo business climate shows "Prinzip Hoffnung" (principle of hope) but little tangible improvement

3. Economic Projections

• Short-term: Some improvement expected but insufficient for robust recovery
• 2026 Outlook: "Strohfeuer" (straw fire) - brief, intense activity that burns out quickly
• TACO Principle: "Trump Always Chickens Out" - suggests Trump may back down from trade threats
• Tariff Impact: Tariff increases have immediate brutal effects on exports, though expectations differ from reality

4. Global Power Dynamics

• US Reliance: USA relies more on EU than EU relies on USA
• US-China Relationship: "Die USA brauchen China mehr als umgekehrt" (USA needs China more than vice versa)
• Historical Context: Trump's connections to Soviet KGB in 1980s (housed them in Trump Tower)
• US Power Erosion: USA giving away international power; erosion of America's soft power
• Arctic Competition: "Der Kampf der Arktis" - Great power rivalries in the Arctic region

5. Shifting Global Alliances

• European Loss: Europe has lost the most in current geopolitical realignment
• Chinese Influence:
  • China has secured raw material countries in Africa
  • Controls almost entire African infrastructure
  • Dominates South America and Australia
• Public Perception: China is more loved in Germany than the USA

6. Market Analysis

• Geopolitical Influence: Markets are "stompingly influenced" by geopolitics since 2019 pandemic
• Fixed Income Recovery: Income is back; fixed income assets with yields over 4% (2020-2025)
• Emerging Markets: Long-term positive growth but currently on downward curve
• Deglobalization Phase: Developing markets experiencing deglobalization trends

7. US Dollar and Economic Concerns

• Trump's Impact: "Trumps biggest Erfolg ist zu machen den Dollar kaputt in 2025" (Trump's biggest success will be to destroy the dollar in 2025)
• US Haircut Risk: Questioning likelihood of US debt restructuring or "haircut"
• Oil Market Efficiency: Oil markets well-priced; very efficient and accurate markets

Key Takeaways

Notable Quotes/Principles

• "Prinzip Hoffnung": German business climate driven by hope rather than substance
• "Strohfeuer": Economic recovery will be brief and intense but unsustainable
• "TACO": "Trump Always Chickens Out" - suggesting Trump's trade threats may not materialize fully

This presentation presents a sobering analysis of the new world disorder where traditional economic models are disrupted by geopolitical tensions, trade wars, and shifting global power dynamics, with Germany particularly vulnerable to these changes.

Fourth Speaker

The fourth speaker was Professor Dr. Sebastian Heilmann, a leading China expert at the University of Trier, Founding Director of MERICS (2013-2018), and author of the upcoming book "Geoeconomics: How Geopolitical Rivalries Reshape Global Markets" (September 2025).

Speaker Background

• Professor Dr. Sebastian Heilmann: Professor for Politics and Economy of China at University of Trier
• Experience: Founding Director of MERICS (Mercator Institute for China Studies) from 2013-2018
• Research Focus: Geoeconomic dynamics in US-China-EU triangle, China's economic system and policies
• International Recognition: One of internationally most cited scholars on contemporary China from Europe
• Advisory Role: Extensive experience advising European policymakers and corporate leaders
• Recent Publication: "Geoeconomics: How Geopolitical Rivalries Reshape Global Markets" (September 2025)

Main Topic: "China: Geopolitics, Technology, and Capital Markets"

Key Themes and Arguments

1. Global Hegemonic Transition

• End of Old Systems: Most important development is the ending of old geopolitical systems
• Chinese Preparedness: China is better prepared for this change, having prepared for the last 8 years
• Asymmetric Pressure: China excels at applying asymmetric pressure on other nations
• Hegemony Shift: Hegemony shifting from USA to China by end of this decade is "very likely"
• Current Reality: "We are in the middle of a change" - this scenario must be taken seriously

2. China's Global Dominance

• Trade Leadership: China is the world's largest trading partner
• "Made in China 2025": Strategic replacement project aiming for world leadership in multiple sectors
• Critical Dependencies:
  • 50% of Chinese exports are critical to US industry
  • Asian and Indian industrial supply chains dependent on China
• Demographic Advantage: China's demographic structure differs significantly from Western nations

3. Technological Competition

• Huawei as Case Study:
  • Developed new chips and operating system through 24/7 development over 4 years
  • Represents "military mobilization" approach - "not only inspiration, but transpiration"
  • Successfully created foldable phones and new AI capabilities
• Green Technology: China is world leader in green technology
• AI Development:
  • "AI Plus" policies to be part of upcoming 5-year plan
  • Chinese AI offered as global alternative to US AI
  • Xi Jinping cautious about AI due to potential to "break a lot" for the Communist Party

4. Technology Bifurcation

• Technospheres Splitting Apart: Global technology ecosystem dividing into separate spheres
• Tech Decoupling: "Tech bifurcation" creating separate technological universes
• Chinese Innovation: China has taken existing technologies and made them better through mass production and export

5. Shifting US-China Dynamics

• Trump Administration: Recent shift from confrontation to dealmaking
• Chinese Response: China's trade policy response to US protectionism
• US Vulnerability: USA more vulnerable to Chinese trade pressure than vice versa
• Jake Sullivan Analysis: US National Security Advisor has analyzed and recognized these dynamics

6. Capital Markets Implications

• Capital Flows: Capital flows will start to exceed goods and services trade in 2025 with huge upward potential
• Investment Decision: "Very probably that USA alliance will drop and China will win"
• Market Consequences: Chinese will have "biggest power and platform" in financial markets

7. German/European Position

• Automotive Industry: German auto industry and parts will decline; E-autos "will not work for Germany"
• Chinese Competition: China has already passed Germany in electric vehicles
• EU Protectionism: EU protectionist policies may help but lack clear plan
• Economic Reality: "Economy is from power now" - economic strength derives from political power

Q&A Session Highlights

Impact on Germany

• Political Leadership: Political middle leadership ("Mittelschichtler") very important
• Niche Industries: German niche industries under Chinese radar but producing best products China cannot make
• Infrastructure Strategy: Chinese strategy to conquer infrastructure globally - finance, build, then control devices and cars
• Testing Opportunities: German auto companies can research and test extensively in China, potentially winning significant opportunities

Electric Vehicle Question

• Electrification Trend: Electrification of China will happen regardless
• German Opportunity: German auto firms can benefit from Chinese electrification through research and testing
• Infrastructure Control: Chinese aim to control global EV infrastructure, then produce the devices and cars

AI and Control

• Party Control: Communist Party focused on maintaining control over AI development
• Xi Jinping's Position: Xi strongly against uncontrolled AI due to potential to disrupt Party control
• Technocratic Approach: China is technocratic but with strong Party oversight of technological development

Key Takeaways

Notable Concepts

• "Technospheres splitting apart": Global technology ecosystem dividing into separate spheres
• "Not only inspiration, but transpiration": Chinese development approach combining ideas with relentless execution
• "Economy is from power now": Economic strength increasingly derives from political power

This presentation presents a sobering analysis of China's systematic rise to global technological and economic dominance, arguing that the Western world, particularly Germany, is unprepared for the fundamental shift in global power dynamics already underway.

Fifth Speaker

The fifth and last speaker was Dr. Wolfram Gerdes. He is a member of the Board of Management responsible for investments and finances at KZVK/VKPB (church pension funds for Protestant church employees) with decades of experience in asset management and insurance.

Speaker Background

• Dr. Wolfram Gerdes: Member of the Board of Management for Investments and Finance at KZVK/VKPB
• Experience: Over 30 years in asset management and insurance industry
• Current Role: Since November 2011, responsible for investments at KZVK/VKPB with approximately €18 billion in assets under management
• Previous Positions:
  • Chief Investment Officer for Württembergische Insurance
  • Managing Director at Cominvest Asset Management and Allianz PIMCO Asset Management
  • Consultant in strategic investment planning, product development, and risk/asset-liability management
• Education: PhD in Mathematics from Massachusetts Institute of Technology (MIT)
• Academic Background: Former professor at Brandeis University (USA)

Main Topic: "Warm-up: Long-term Investors Can Withstand More Volatility"

Key Themes and Arguments

1. Challenging Conventional Risk Definitions

• German Risk Aversion: "Germans do not like risk" - addresses the cultural tendency toward risk avoidance
• Redefining Risk: "Need to define risk in another way" - challenges traditional approaches to risk assessment
• Risk vs. Volatility: "Risk is not volatility" - fundamental argument that conventional measures miss the true nature of risk
• Algorithmic Approach: Views risk through algorithmic frameworks rather than simple volatility measures

2. Investment Philosophy and Strategy

• Buffett Principle: References Warren Buffett's famous "buy low and sell high" (criticizing the opposite "buy high and sell low" approach)
• Risk Definition: "Risiko ist die Gefahr, dass das Angestrebte und Mögliche nicht erreicht wird" (Risk is the danger that the desired and possible will not be achieved)
• Long-term Focus: Advocates for long-term investment horizons as the key to managing risk

3. Market Volatility and Crisis Management

• Uncertainty Principle: "Nobody even knows with certainty the next few weeks" - emphasizes fundamental uncertainty
• Pandemic Perspective: Presents pandemic scenario as either opportunity ("when the pandemic is over then we can make some money through the stress") or existential threat ("if the pandemic is deadly then we will all die")
• Career-long Volatility: "He always had the stress about volatility every year of his career" - normalizes market volatility as constant feature

4. Generational Investment Challenges

• Youth Challenge: "It will be worse for the younger generation" - suggests future generations face greater investment challenges
• Timing Problem: "Who waits for the perfect moment will never get it" - argues against market timing
• Perpetual Crisis: "We will always find the next crisis" - frames crises as inevitable and constant

5. Currency and International Investment

• Currency Risk: "Wie gehen sie mit Währung? Private Investoren Währung? Schlechtes Risiko, Volatilität" (How to handle currency? Private investor currency? Bad risk, volatility)
• Hedging Strategy: "When you want to give away your euro, then you need to hedge your spreads"
• International Stocks: "International stocks is not attractive. This year is outlier" - questions attractiveness of international equities
• Interest Rate Dependency: "Zinsen. Depends on the land" - emphasizes country-specific interest rate environments

6. Long-term Investment Strategy

• Portfolio Diversification: "Diverse portfolio of private equity and immobilien over timeframe of 10 years plus"
• Risk Reduction: "Risk goes down" with long-term (10+ year) investment horizons
• Asset Classes: Emphasizes private equity and real estate (immobilien) as key components for long-term portfolios

Research-Based Insights (from KZVK-VKPB Investment Approach)

1. Active Management Philosophy

• Fee Negotiation: Believes investors don't have to pay high fees for active management; "it should always be possible to negotiate fees with good managers"
• Manager Selection: Good active managers have "strong ideas and beliefs, and continuity of staff"
• Size Myth: Contrary to common belief, "active managers did not have to be small (in terms of assets under management) to be good"
• Alpha Sources: Alpha is "not only available in illiquid markets"

2. Long-term Horizon Investing

• Short-term Problem: Active management tends to be short-term in nature, which is "the great difficulty"
• Long-horizon Movement: "Long-horizon investing" is gaining momentum through initiatives like "Focusing Capital on the Long Term"
• New Mandate Forms: Envisions new types of active management mandates that are "far from any benchmark but also low in terms of turnover"

3. German Pension Fund Context

• Conservative Nature: German pension funds are "conservative and risk-averse investors"
• Fixed Income Trend: Many German pension funds are strengthening fixed income allocations for "robust risk mitigation against volatile equity markets"
• ALM Focus: Asset/Liability Management studies drive strategic allocation decisions
• Hedging Practices: Equity mandates often fully hedged to "lock in gains"

Key Takeaways

Notable Quotes/Principles

• "Risk is not volatility" - Fundamental challenge to conventional risk assessment
• "Who waits for the perfect moment will never get it" - Argument against market timing
• "We will always find the next crisis" - Normalization of perpetual market uncertainty
• "Risk is the danger that the desired and possible will not be achieved" - Alternative risk definition

This presentation represents a sophisticated challenge to conventional risk management approaches, particularly within the German context, advocating for a more nuanced understanding of risk that goes beyond simple volatility measures and emphasizes the importance of long-term investment horizons and proper fee negotiation in active management.

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