Nick Hamilton | From Forecaster to Bridgewater Investment Associate

One of the things that really stood out to me was the curiosity that you brought to these things. It's — like a really interesting challenge. I think it mirrors exactly what we do here at Bridgewwater. — Hi everyone. Uh my name is Will Barnes and I lead the geopolitics and policy research team here at Bridgewwater. Um and one of the things I've loved about working here for the last nine years is that we have this deep conviction that the best ideas can come from anywhere. Um, I think there's a really exciting parallel to that in the forecasting the future competition. And I'm here today with one of our winners from last year, Nick Hamilton, who's now a full-time investment associate here at Bridgewwater, working on our macro policy team. I thought it would be worthwhile to sit down to um hear more about your approach to the challenge. So, I'm excited to talk with you, Nick. Welcome. — Likewise. I thought we were doing t-shirts and then you rock up in a suit. Um, — the no blazers. This is my fancy jacket. — Yeah. No, I broke the rules. So, why don't we start with uh you telling us a bit about yourself, um your background, uh what you were doing before the challenge uh and before joining us at Bridgewwater. And it would be great to hear how you found the challenge and what got you intrigued about uh taking part in it. Yeah, I grew up in South Africa. Um, but I've been working in New York for the last few years. And some of the work that I've been doing was focusing on some of the sort of similar issues looking at trade policy, looking at tariffs. Um, and I think the kind of fascinating thing about the Bridgewater competition is that it kind of brought all of those threads together that I was working on. um you know through this framing of modern mercalism as like one big force that drives all of these sort of more separate questions when you look at it like that it sort of becomes interesting and you can start to think what's the effect on markets you know future government policies um and so I think it's like a really interesting challenge and that's kind of why — you won um and it would be great to hear what was that like the experience of finding out that you'd won what happened next. — Yeah. So, I mean, obviously super exciting. I think Danny and Ryan actually told me and I actually recognize Danny from uh you know, I used to do debating and I think he's like some sort of world champion or something, you know, something apparently — to be confirmed. — Yeah. Unclear. — Bank check. — Yeah. And so, you know, that was great. And then, you know, a bunch of interviews, one of which was with you. I mean, I'm not saying you're not a serious person, but I don't know if it was a very serious interview. I feel like we just spoke about the tariff calculators the whole time that we had both respectively built. Um but I think that's one of the good things about Bridgewater is you know you can find people who you know are curious about everything in the world and you know you can get along with anyone based on that. So — yeah, well tariffs are one of my great passions in this world and um — yeah, I mean I think a lot of your uh challenge you really drilled in on trade policy which I enjoyed but no I remember thinking I I was looking back at my scorecard from our interview and one of the things that really stood out to me was the curiosity that you brought to these things and I think that's one of the things that most stands out about people who work at Bridgewater, the most interesting submissions to this kind of challenge is like who are the people who really want to understand how the world works, use markets to stress test that thinking and so on. So now you're working at Bridgewater full-time. Obviously we work together around Micron policy, but you also do a lot of work with other senior investors and so it would be great to hear how's that going, what have you been working on so far? Um, and are there any parallels between your work here and the challenge? — Yeah, I mean I think the work has been, you know, super involved right off the bat. Um, and I think there's a lot of room to make a big impact at Bridgewater. Um, you know, I've only been here two months and I've got to work on some really cool projects. So, one of them's been working on the growth impacts of the Iran conflict with Kate Dunar, who's the head of macro. And then, you know, on the other side of the spectrum, working with uh Greg Jensen, our CIO, on some of the AI impacts uh that we're seeing both in sort of software markets, but also sort of the more broad macro impacts. Um, and yeah, I mean a lot of it's really similar to the stuff in the competition. Uh, you know, you're working with data, then you're taking that data and trying to put it into visuals or ways that you can understand it, and then you're building a synthesis on that and then thinking about what that means for markets and uh, you know, thinking about that in probability terms is the best way to do it. So, I think it kind of mirrors uh, exactly what we do here at Bridgewater. Now that you've been here for a couple of months, you've had a lot of exposure to Bridgewwater's culture and our way of thinking um through these questions together collaboratively um the idea of meritocracy trying to really figure out what's true. Um what has been your experience of that coming into Bridgewater? Yeah, I think the sort of idea that you know the best ideas can kind of win and that's kind of what this whole competition is about is really like

gives you something to work towards and grounds the way everyone thinks about things rather than just being right about it and it kind of means that you know nonconformist thinking can really flourish here and uh is sort of not only accepted but encouraged. Um so I think that's like one of the best parts about it. So we have your uh challenge in front of us here. Why don't you tell us about your approach to the uh to the challenge? — Yeah, I think the sort of way to approach something like this is to not get too bogged down in the predictions you want to make right at the beginning. And I think it's like you want to think of a framework that you can then use um to think probabilistically about the world. So on mine it kind of why are we in a modern worthless world? What does that mean? And like what are the risks? and then draw your predictions from that. And then I think you know once you've done that you can tighten up on what sort of predictions you want to make and like ballpark what you think they sort of represent in terms of a probability then you can kind of drill down on those numbers and try and get more quantitative but I think you want to start with a sort of overarching framework of how you see the world and understand you know modern mercantalism or AI or whatever you're trying to make forecasts on. When it comes to making forecasts in this competition, it's not like we gave you a menu of things you had to put probabilities on. You came up with your own set of um scenarios and probabilities for them. How did you think about what you'd like to forecast and what time horizons you were thinking about? Because when I looked at your list of forecasts here, it was pretty varied in terms of the time horizons we were talking about. — Yeah. Well, you know, looking at the forecasts, as you pointed out before we started this conversation, a lot of the predictions are actually wrong. Although maybe you were just reading out the ones that were wrong. Um, — I'm kidding. — But I think you know you want to kind of approach it on thinking like what are the key questions that would affect markets and assigning probabilities to those things first and then you know I think you want a variation of time frames. Having both of those I think helps you triangulate off of each other. It would be great to hear about uh one thing you got you think you got right when you pulled this together and one thing you got wrong. — The wrong stuff is definitely I think the tariff rates that I were projecting ended up being a bit on the high side. Um I think on like the policy side uh some of the stuff ended up being closer. I think I was had a lot of conviction on getting struck down and you know that's happened. So but you know we didn't net out to exactly the right place even so on the tariff rates I was predicting. I can confirm you nailed it on the AIPA forecast and what would come after that. — Can you tell us a little about how you approached using data in the process of coming up with forecasts and explaining your thinking? — The way I approach everything is kind of if you want to make a point, you want to have a chart to make the point for you and you kind of shouldn't even really have to say anything about it. Uh so like I like it when I can like look through a piece of research and I wouldn't have to read a single word but charts can tell the story. Once you've built that framework you can extrapolate that into what you think that means. Um but I think you want like the grounding that you're using of how you understand the world at present to all be completely data driven. So I think definitely if you're entering the competition you want to have a lot of charts. — So as we look ahead to this year's challenge do you have any advice for the people who are taking part? um or if you were running it back and entering again uh what would you do this year? — The sort of the big thing that I would say is you know you've got to have your own original thinking. Um but I think you know now there's so much more room to sort of extensively use AI to build tools to sort of analyze data and to use that to kind of develop your insights. And I think the quality of your insights could just be so much better now. And so if I was running it back this year, that's exactly what I would be doing. — Deeper research. — Yeah, I think you can really get deep on a question um now. So in a short amount of time. So you should definitely take part. — Well, thank you very much for doing this. Uh it's been a pleasure talking with you and uh best of luck to everyone who's entering this year. — Likewise. Will likewise. Good luck everyone.