ABOUT US
“Pragmatic Capitalism” was founded to provide investors with a totally unbiased professional perspective on Wall Street. We provide research, indicators, and news that the mainstream media leaves largely unnoticed. We have just one agenda at Pragmatic Capitalism: helping investors decipher information in a way that helps them create an investment plan that produces superior market returns. We don’t care for the bull side or the bear side – only the right side. Unlike most financial websites we only post commentary and research that we ourselves find useful and informative. Part of an investor’s job is to decipher and break down the enormous amount of data available. We hope to aggregate that data into one place where investors can easily obtain and decipher only the most pertinent information.
Rather than focus on one facet of markets, the goal at Pragmatic Capitalism is to assess and address global capital markets as a whole - with the understanding that all markets are intertwined and being an “expert” in one segment of the market without a vast knowledge of the others is futile.
The saying “common sense is very uncommon” has never been more applicable than it is to modern markets. Pragmatic Capitalism attempts to approach markets with sound reasoning and as little emotion as possible. We believe psychology is one factor that drives markets and therefore understanding the underlying market psychology can significantly improve ones odds of market outperformance.
Pragmatic Capitalism was founded by Cullen Roche in the midst of the financial crisis of 2008. Mr. Roche foresaw many of the events that led up to the crisis and felt that the government was slow to react and when it did finally react, responded with the wrong medicine. While also providing relevant news and indicators the website remains very much a sounding board in which the various authors (and readers) can voice their opinions on markets, economics and public policy. In addition to regular commentary by Mr. Roche the website is a collaborative work from many different financial experts.
Mr. Roche is the founder of an investment partnership. His primary areas of expertise include global macro portfolio construction, quantitative risk management, behavioral finance and financial theory. He is the long-time #1 economics writer on the popular financial website Seeking Alpha and was named one of the “Top Wall Street Economists, Experts and Opinion Leaders” of 2011 by Wall Street Economists. He is regularly cited in the Wall Street Journal, on CNBC and in the Financial Times. Prior to establishing his own business, Mr. Roche worked at Merrill Lynch Global Wealth Management where he helped oversee $500MM+ in assets under management. Mr. Roche is a Georgetown University alumnus, growing up in the DC area and now living in Southern California.
Research & Methodology
All research used at Pragmatic Capitalism is based on a top down investment approach. The research and market methodology is based on cognitive science and the theory of chaos. Through the understanding of market psychology you can derive that markets are non-linear dynamical systems which are susceptible to inefficiencies. Markets are inefficient in short time periods due to their chaotic nature (a symptom of human psychological irrationality). This creates opportunity.
Based on this methodology we employ risk management structures that account for the possibility of short-term inefficiencies and random occurrences within large and liquid systems. Although there are short-term opportunities in markets, risk management is the overriding factor in achieving high absolute returns. Black swans cannot be predicted, but they can be avoided by employing proper risk management. This analytical, quantitative and systematic approach helps us in achieving our goal of high absolute returns.
