Could your portfolio be over-diversified and under-diversified at the very same time?

Liquid alternatives, operational due diligence, and emerging managers: Dr. Ranjan Bhaduri, PhD, of Bodhi Research Group sits down with Angelo Calvello. Join us for a sharp, candid conversation about the evolution of liquid alternatives, the rise of transparency and governance after Madoff and the financial crisis, and why some strategies survived while others quietly disappeared. If you allocate to hedge funds, manage institutional capital, or build absolute-return portfolios, this episode addresses the challenges you face right now.

Ranjan discusses how liquid alts evolved from the pre-GFC era of a handful of dominant managers into a far more scrutinized market. He explains why the financial crisis created lasting demand for liquidity, transparency, managed accounts, and operational due diligence. He also explores which strategies gained ground and which lost relevance, including managed futures, insurance-linked securities, and convertible and merger arbitrage being absorbed into multi-strategy funds.

The conversation also explores how allocators are thinking about emerging managers, portfolio construction, and total portfolio alignment. Ranjan offers practical guidance on manager selection, including how to evaluate culture, research processes, governance, and fraud risk. He emphasizes that a strong track record is never enough if the underlying business is weak, and that operational due diligence should be a central part of the investment process rather than a checkbox.

The episode also turns to AI and the future of manager research and Total Portfolio Approach (TPA). This is essential listening for anyone seeking a clearer view of the evolution of liquid alts, the weaknesses in many portfolios, and how sophisticated allocators are approaching manager research, portfolio construction, and due diligence.

Dr. Ranjan Bhaduri, PhD, is the Founder and CEO of Bodhi Research Group, an independent, conflict-free firm dedicated to research and education in alternative investments. Under his leadership, Bodhi has served clients on five continents. His expertise spans hedge fund research, hedge fund factorization, portfolio management, and investment, operational, and structural due diligence. He previously served on an Investment Committee at Morgan Stanley and worked with two major Canadian investment banks. A CFA and CAIA charterholder, he has served on the AIMA Canada board and co-chaired its Managed Futures Committee.

In This Episode:
(00:00) Opening highlights and introduction of Dr. Ranjan Bhaduri, Bodhi Research Group
(04:11) How liquid alts evolved from early trend followers to today
(06:48) The GFC and Madoff spark demand for transparency and governance
(13:22) Which hedge fund strategies survived, and why managed futures stalled
(16:56) AI black box hypothetical and the hidden costs of swaps
(22:03) Why allocators are over-diversified and under-diversified at once
(30:26) AI, behavioral cues, and trust in operational due diligence
(38:34) Total Portfolio Approach: governance, culture, and Canadian pension leaders
(40:53) Worst pitch stories: locked doors and managers who turned fraudulent

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Dr. Angelo Calvello is a serial innovator and co-founder of multiple investment firms, including Rosetta Analytics and Blue Diamond Asset Management. He leverages his extensive professional network and reputation for authentic thought leadership to curate conversations with genuinely innovative allocators and thinkers.

As the "Dissident" columnist for Institutional Investor and former "Doctor Is In" columnist for Chief Investment Officer (winner of the 2016 Jesse H. Neal Award),...