Inflation ETF Pioneer Says Investors Need More Interest-Rate Risk
Quadratic’s Nancy Davis explains why she switched to managing ETFs instead of a hedge fund
Nancy Davis was a trader at Goldman Sachs Group Inc. and a fund founder before she made a splash with IVOL, an actively managed exchange-traded fund that allows investors to bet on inflation and interest-rate volatility. The Tampa native says she’s loved the nonlinear risk of options trading since she was in college at George Washington University. Today her firm, Quadratic Capital Management, no longer manages hedge fund money. Instead Davis focuses on overseeing the IVOL strategy, which had about $3.56 billion as of mid-November, and a deflation strategy, BNDD, that opened in September. Davis, 45, spoke with Bloomberg Markets in October about her career, why fixed-income investors need volatility exposure, and her relationship with fellow active ETF manager Cathie Wood of Ark Investment Management. The interview has been condensed and edited for clarity. (Bloomberg Terminal users can view a transcript of a TopLive Q&A with Davis here.)
How did you get your start in finance?