Mark Rzepczynski, founding partner and CEO of AMPHI Research and Trading, told Niels Kaastrup-Larsen on Top Traders Unplugged that maybe over 90% of hedge fund managers now use machine learning to find alpha.
Most of the industry treats machine learning as the edge. Mark said the opposite is happening: the same techniques, taught at the same schools, are crowding funds into the same trades, while trend following has no fixed alpha half-life to lose.
"There is no secret sauce with the techniques, because the techniques are being taught in schools, and those are the people that are being hired as quants at all these firms."
Mark was President and CIO of John W. Henry & Co., one of the best-known commodity trading advisors. Before that he headed fixed income research at Fidelity Management and Research and served as a senior economist at the CME.
The full interview is covered here so you can skip it. 74 minutes of audio, 10 minutes of reading.
Here are the 11 arguments that matter.
Top Traders Unplugged · Oct 24, 2026 · 1h 14m · 64m saved
With Mark Rzepczynski, Founding Partner and CEO at AMPHI Research and Trading
Key Takeaways
Stocks keep rising on earnings growth that has outpaced rising discount rates, until momentum stalls
Trend followers shorting bonds is no longer anomalous now that rates move both ways
A shortage of bank intermediation capital raises the odds of disorderly dislocations
Today's yields are a return to normalcy, with a fair nominal rate near 5–5.5% before any term premium
The convenience yield on long-dated Treasuries is shrinking as issuance grows
Low inventories, not low production, make commodity prices go parabolic when buyers hoard
With over 90% of hedge funds using machine learning, the alpha half-life is shortening
Trend following waits out trendless periods instead of decaying
1. Earnings Beat Rate Rises
Niels opened on record French yields, with the 10-year near 5%, up 1.65 points over 12 months and at a 24-year high. He set "FIMO," fabulous earnings momentum measured by actual EPS growth, against FOMO, and said FIMO is winning even as P/E multiples contract.
Mark explained the stock rally through a dividend-discount model
"Once earnings stop to increase, you lose earnings momentum. Then... the discount rate will then become more dominant... that's where the real fear comes in." — Mark Rzepczynski
Discount rates are rising with interest rates, which on their own would pull stock prices down. Earnings growth has so far been large enough to outweigh that effect. Once earnings growth stalls, the higher discount rate takes over as the main driver of valuations.
