Ben Hunt

Co-Founder and CIO

 @EpsilonTheory

Ben Hunt is the creator of Epsilon Theory and inspiration behind Second Foundation Partners, which he co-founded with Rusty Guinn in June 2018.

Epsilon Theory, Second Foundation’s principal publishing brand, is a newsletter and website that examines markets through the lenses of game theory and history. Over 100,000 professional investors and allocators across 180 countries read Epsilon Theory for its fresh perspective and novel insights into market dynamics. As Chief Investment Officer, Ben bears primary responsibility for determining the Company’s investment views and positioning of model portfolios. He is also the primary author of materials distributed through Epsilon Theory.

Ben taught political science for 10 years: at New York University from 1991 until 1997 and (with tenure) at Southern Methodist University from 1997 until 2000. He also wrote two academic books: Getting to War (Univ. of Michigan Press, 1997) and Policy and Party Competition (Routledge, 1992), which he co-authored with Michael Laver. Ben is the founder of two technology companies and the co-founder of SmartEquip, Inc., a software company for the construction equipment industry that provides intelligent schematics and parts diagrams to facilitate e-commerce in spare parts.

He began his investment career in 2003, first in venture capital and subsequently on two long/short equity hedge funds. He worked at Iridian Asset Management from 2006 until 2011 and TIG Advisors from 2012 until 2013. He joined Rusty at Salient in 2013, where he combined his background as a portfolio manager, risk manager, and entrepreneur with academic experience in game theory and econometrics to work with Salient’s own portfolio managers and its financial advisor clients to improve client outcomes.

Ben is a graduate of Vanderbilt University (1986) and earned his Ph.D. in Government from Harvard University in 1991. He lives in the wilds of Redding, CT on Little River Farm, where he personifies the dilettante farmer that has been a stock comedic character since Cicero's day. Luckily his wife, Jennifer, and four daughters, Harper, Hannah, Haven and Halle, are always there to save the day. Ben's hobbies include comic books, Alabama football, beekeeping, and humoring Rusty in trivia "competitions".

Articles by Ben:

Increased Instability in US Markets

By Ben Hunt | August 19, 2013 | 0 Comments

The Common Knowledge informational structure around the US market has weakened in recent weeks, making the risk/reward assessment of ALL exposures — long and short — less certain. epsilon-theory-increased-instability-in-us-markets-august-19-2013.pdf (246KB)

Schrödinger’s Portfolio

By Ben Hunt | August 3, 2013 | 0 Comments

“The world is given to me only once, not one existing and one perceived.” – Erwin Schrödinger “Quantum theory provides us with a striking illustration of the fact that we can fully understand a connection though we can only speak of it in images and parables.” – Werner Heisenberg “What we observe is not nature itself, but …

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The Framing of Macro Data

By Ben Hunt | July 31, 2013 | 0 Comments

A review of Narrative formation immediately after the July 31st release of Q2 US GDP data. epsilon-theory-the-framing-of-macro-data-july-31-2013.pdf (232Kb)

Rise of the Machines

By Ben Hunt | July 28, 2013 | 0 Comments

“Music, this complex and mysterious act, precise as algebra and vague as a dream, this art made out of mathematics and air, is simply the result of the strange properties of a little membrane. If that membrane did not exist, sound would not exist either, since in itself it is merely vibration. Would we be …

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The Tao of Portfolio Management

By Ben Hunt | July 21, 2013 | 0 Comments

“Shape clay into a vessel; It is the space within that makes it useful. Cut doors and windows for a room; It is the holes which make it useful. Therefore benefit comes from what is there; Usefulness from what is not there. ” – Lao Tzu “The limits of my language means the limits of my …

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The Market of Babel

By Ben Hunt | July 14, 2013 | 1 Comment

“But Achilles, weeping, quickly slipping away from his companions, sat on the shore of the gray salt sea, and looked out to the wine-dark sea.” – Homer, “The Iliad” The story of the Tower of Babel in the Book of Genesis, from whence we get the word “babble”, has always struck me as one of the …

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The Music of the Spheres and the Alchemy of Finance

By Ben Hunt | July 7, 2013 | 1 Comment

“You say that we go round the sun. If we went round the moon it would not make a pennyworth of difference to me or to my work.” – Sherlock Holmes (from “A Study in Scarlet” by Arthur Conan Doyle) “It doesn’t matter if the cat is black or white, as long as it catches mice.” …

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How Gold Lost Its Luster, How the All-Weather Fund Got Wet, and Other Just-So Stories

By Ben Hunt | June 30, 2013 | 0 Comments

Gold is money. Everything else is credit. – John Pierpont Morgan The relationships of asset performance to growth and inflation are reliable – indeed, timeless and universal – and knowable, rooted in the durations and sources of variability of the assets’ cash flows. – Bob Prince, Co-Chief Investment Officer, Bridgewater Associates Like every middle-aged white guy I …

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The Matrix Reloaded — Seeing Markets as Informational Structures

By Ben Hunt | June 27, 2013 | 0 Comments

A review of current market informational structure one week post the June 19th FOMC announcement. epsilon-theory-matrix-reloaded-seeing-markets-as-informational-structures-june-27-2013.pdf (295KB)

2 Fast 2 Furious

By Ben Hunt | June 23, 2013 | 0 Comments

We are all impaled on the crook of conditioning. – James Dean (1931 – 1955) This note is a sequel to my letter from two weeks ago, What We’ve Got Here Is … Failure to Communicate, a sequel made necessary by the market fall-out from the FOMC announcement on Wednesday. The Fed’s communications to the market are …

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