Billionaire Investor Cliff Asness on Managing Risk, 'Buffer' ETFs and More | WSJ’s Take On the Week

In this week's episode of WSJ’s Take On the Week, co-hosts Gunjan Banerji and Telis Demos talk to billionaire investor Cliff Asness, the co-founder and chief investment officer of AQR Capital Management. AQR is a global investment management firm known for quantitative investing, an approach that builds strategies based on data and research. Asness discusses one of the market's biggest trends: the explosion in popular ETFs designed to protect investors from downturns. But do they actually work? Later, Asness shares why he thinks trading on Robinhood can feel more like betting on FanDuel, why the stock market has become less rational due to social media, and whether Palantir and Tesla are on the meme stock spectrum. Then, he weighs in on companies reporting earnings every six months, market froth and the bind facing the Federal Reserve. Chapters: 00:00 AQR's Cliff Asness on the options trading boom 01:25 Have 'buffer' and 'hedged equity' funds gone too far? 02:15 How buffer funds work (and why they're tempting) 03:20 The 'Equity Risk Premium': The price you pay for returns 04:25 A simpler alternative: combining stocks with cash 05:10 The data: Do hedged funds actually work? 06:28 Why a 'grinding bear market' is the biggest threat 08:15 Is hedging just a smart way to say 'market timing'? 09:45 The underrated power of doing nothing 11:30 Uncorrelated returns: A better way to diversify? 14:25 Why diversification 'failed' for U.S. investors 16:35 The big theory: Have markets become less efficient? 19:10 The impact of social media and 'mob mentality' 20:25 From meme stocks to Tesla: A spectrum of irrationality 21:38 Comparing single-day options to FanDuel 22:50 The market: A 'voting machine' or a 'weighing machine'? 24:35 Why investors should learn to embrace volatility 25:55 The debate over quarterly company earnings reports 27:50 The biggest risk to markets right now 28:15 The Federal Reserve's 'mild bind' 28:45 Cliff's biggest worry: Market 'froth' This is WSJ’s Take On the Week where co-hosts Gunjan Banerji, lead writer for Live Markets, and Telis Demos, Heard on the Street’s banking and money columnist, cut through the noise and dive into markets, the economy and finance—the big trades, key players and business news ahead. Have an idea for a future guest or episode? How can we better help you take on the week? We’d love to hear from you. Email the show at takeontheweek@wsj.com. #WSJ #Investing #ETFs

Added 25 Aug 2026