Policy Tensor notes that in stocks money is made at night, with markets closed

the post also mention “the strategy” how large hedge funds acted back then, trading at open where thier size can influence the market and then again at close when market is more liquid. This Knutsetson theory, he argued that “because markets are less liquid in the morning than they are in the afternoon, a hedge fund with a large portfolio can “expand his portfolio early in the day, when his trading moves prices more, and contract his portfolio later in the day, when his trading moves prices less, creating mark-to-market gains on his large existing book that exceed the cost of his daily round-trip trading.”

Anyway there’s more theory discussed but there’s also how to build a “derisked” portfolio on this idea of overnite gains, that would have performed wonders to date.

“Derisking” should have a mention here already, used by Daniela Gabor on Blackrock and climate investments, with a completely different meaning, and indeed “(just to piss off Daniela Gabor).” 🙂