Nature as Alpha: Richard Kelly on the Natural Capital Opportunity

Nature as Alpha: Richard Kelly on the Natural Capital Opportunity

Natural capital is the oldest asset class on earth — and one of the least understood by institutional investors. Richard Kelly, Managing Director and Co-Lead of Foresight Natural Capital at Foresight Group, makes the investment case from first principles: compelling risk-adjusted returns, a strong inflation hedge through commodity-linked cash flows, and genuine portfolio diversification with low correlation to equities, bonds, and real estate. He maps the investable landscape across categories — provisioning services, cultural services, and regulating and maintenance services — and argues that the middle ground, where land value underpins the return and carbon credits provide upside, is where the most compelling opportunities are emerging. The conversation gets sharper when it turns to barriers. Kelly acknowledges the challenges institutional investors will recognize from other private markets — illiquidity, limited track record, a thin product set — but frames them as features of an asset class at an inflection point rather than reasons to wait. He addresses the troubled history of voluntary carbon markets directly, arguing that past scandals have accelerated the shift toward higher-integrity, removal-based credits, and that demand from the 10,000-plus companies with validated science-based net zero pledges will drive a structural supply shortage. He also warns investors to look past the natural capital label: owning a forest or a farm is not inherently a good investment, and the due diligence question is what is actually being done with the asset on the ground. Richard Kelly is Managing Director and Co-Lead of Foresight Natural Capital at Foresight Group, where he focuses on sustainable real estate, forestry, and natural capital investment strategy. He joined Foresight in 2015 and has spearheaded direct origination of off-market afforestation land, leading the development and launch of four innovative strategies attracting approximately £1.5 billion in investment. With over 19 years of finance experience, Richard previously worked at Accenture as a Strategy Manager advising on merger and acquisition strategy across industries. He holds a BA in Business Management from Exeter University. In This Episode: (00:00) Richard Kelly, Foresight Natural Capital, and today's context (03:43) Defining natural capital and its three ecosystem service categories (06:44) Why natural capital is becoming a mainstream institutional asset class now (13:50) The fiduciary case: competing head-to-head on risk-adjusted returns (16:21) Mapping three investable strategies across the risk spectrum (21:45) Voluntary carbon markets: from early scandal to high-integrity supply shortage (30:04) Barriers to adoption, available structures, and greenwashing risks Like, subscribe, and share this episode with someone who might be interested, and please take time to leave us a review! Dr. Angelo Calvello is a serial innovator and co-founder of multiple investment firms, including Rosetta Analytics and Blue Diamond Asset Management. He leverages his extensive professional network and reputation for authentic thought leadership to curate conversations with genuinely innovative allocators and thinkers. As the "Dissident" columnist for Institutional Investor and former "Doctor Is In" columnist for Chief Investment Officer (winner of the 2016 Jesse H. Neal Award), Calvello has become a leading voice challenging conventional investment wisdom. Beyond his professional pursuits, Calvello serves as Chairman of the Maryland State Retirement and Pension System's Climate Advisory Panel, Chairman of the Board of Outreach with Lacrosse and Schools (OWLS Lacrosse), a nonprofit organization creating opportunities for at-risk youths in Chicago, and trustee for a Chicago-area police pension fund. His career-long focus on leveraging innovation to deliver superior client outcomes makes him the ideal host for cutting-edge institutional investing conversations. Resources: Richard Kelly LinkedIn: https://www.linkedin.com/in/richard-kelly-1334479/ [https://www.linkedin.com/in/richard-kelly-1334479/]Our Natural Capital Strategy: https://foresight.group/strategies-funds/private-markets/natural-capital/ [https://foresight.group/strategies-funds/private-markets/natural-capital/]Natural Capital Horizons: https://foresight.group/strategies-funds/private-markets/natural-capital/ [https://foresight.group/strategies-funds/private-markets/natural-capital/]Natural Capital Report 2026: https://foresight.group/media/u0npgpcd/natural-capital-report-2026.pdf [https://foresight.group/media/u0npgpcd/natural-capital-report-2026.pdf]Natural Capital Family Offices Research: https://foresight.group/news-insights/news/2025/over-half-of-uk-family-offices-already-invest-in-natural-capital-strategies/ [https://foresight.group/news-insights/news/2025/over-half-of-uk-family-offices-already-invest-in-natural-capital-strategies/]Angelo.Calvello@pionline.com [Angelo.Calvello@pionline.com]Email Julie: julie.parten@pionline.com [julie.parten@pionline.com] Pensions & Investments [https://www.pionline.com/]Dr. Angelo Calvello LinkedIn [https://www.linkedin.com/in/angelocalvello/]

The Overlay That Paid for Itself: Verizon's Case for In-House GTAA

How does a pension fund walk away from a global market crisis with $400 million in fresh liquidity? In this episode of Institutional Edge, host Angelo Calvello speaks with Zhuoying (Joy) Xu, CFA, Senior Investment Director at Verizon Investment Management Corp (VIMCO). Joy shares how VIMCO built a systematic, derivatives-based GTAA overlay program that has generated over $1.2 billion in profit since 2014 — including nearly $400 million during COVID-19. She walks through the four-theme quantitative factor model, the qualitative Executive Committee oversight structure, and how the overlay functions as a self-funding tail risk hedge, offering a cost-efficient, high-conviction alternative to traditional options-based protection strategies. Zhuoying (Joy) Xu, CFA, is a Senior Investment Director at Verizon Investment Management Corp (VIMCO), where she oversees a $50 billion institutional portfolio encompassing the company's pension and savings plans. As a core member of VIMCO's Executive and Investment Committees, Joy drives portfolio construction and asset allocation strategy and directs external manager due diligence across public and private markets. She has led a tactical overlay program that generated over $1.2 billion in profit over her ten-year tenure. Joy's career includes roles at BlackRock and Bank of America; she holds an MS in Finance from Boston College. In This Episode: (0:00) GTAA history and Joy Xu's $1.2B overlay at Verizon (03:14) Genesis of Verizon's GTAA program and the SAA gap it was built to bridge (06:38) Four-theme quantitative model: valuation, momentum, sentiment, and liquidity (12:09) Risk management constraints, biweekly rebalancing cadence, and derivatives execution (17:49) Qualitative oversight structure: EC governance, business cycles, and monetary policy (21:57) Model overrides, performance results, and the self-funding tail risk hedge explained (30:13) Building in-house GTAA: operational rigor and reframing the market timing objection Like, subscribe, and share this episode with someone who might be interested, and please take time to leave us a review! Dr. Angelo Calvello is a serial innovator and co-founder of multiple investment firms, including Rosetta Analytics and Blue Diamond Asset Management. He leverages his extensive professional network and reputation for authentic thought leadership to curate conversations with genuinely innovative allocators and thinkers. As the "Dissident" columnist for Institutional Investor and former "Doctor Is In" columnist for Chief Investment Officer (winner of the 2016 Jesse H. Neal Award), Calvello has become a leading voice challenging conventional investment wisdom. Beyond his professional pursuits, Calvello serves as Chairman of the Maryland State Retirement and Pension System's Climate Advisory Panel, Chairman of the Board of Outreach with Lacrosse and Schools (OWLS Lacrosse), a nonprofit organization creating opportunities for at-risk youths in Chicago, and trustee for a Chicago-area police pension fund. His career-long focus on leveraging innovation to deliver superior client outcomes makes him the ideal host for cutting-edge institutional investing conversations. Resources: Joy Xu / VIMCO LinkedIn: https://www.linkedin.com/in/zhuoyingxu/ [https://www.linkedin.com/in/zhuoyingxu/]Email Angelo: acalvello@c79llc.com [acalvello@c79llc.com] Email Julie: julie.parten@pionline.com [julie.parten@pionline.com] Pensions & Investments [https://www.pionline.com/]Dr. Angelo Calvello LinkedIn [https://www.linkedin.com/in/angelocalvello/]

From Qubits to Portfolios: The Investor's Guide to Quantum Computing

Quantum computing may already be in your portfolio — do you know what you actually own? In this episode of The Institutional Edge, host Angelo Calvello is joined by Dr. Daniel Volz — deep-tech entrepreneur, quantum computing expert, and founder and former CEO of KIPU QUANTUM — and Dr. Elisabetta Basilico, financial professional, institutional allocator, and author of Smarter Investing. Quantum computing is not a faster computer — it is a fundamentally different computing paradigm, and it is now at the threshold of commercial relevance. Elisabetta identifies three problems current portfolio construction tools leave genuinely unsolved. Daniel addresses all three, while also confronting the harder realities: scarce and expensive talent, the emerging risk of quantum washing, and why diversified exposure through hardware companies or a dedicated quantum VC fund is the prudent entry point today. Dr. Elisabetta Basilico is a financial professional with over 20 years of experience working with institutional investors, including pension funds, asset managers, and family offices. Her areas of expertise include asset allocation, risk management, fund due diligence, and performance analysis. She is the author of Smarter Investing: How Academic Insights Propel the Savvy Investor and has written numerous articles on investing and financial education. She earned her PhD from the University of St. Gallen and has held the CFA designation since 2007.   Dr. Daniel Volz is a deep-tech entrepreneur and quantum computing expert with experience spanning strategy consulting, industrial R&D, and venture building. He is the founder and former CEO of KIPU QUANTUM, a quantum software company focused on developing application- and hardware-specific quantum algorithms for real-world industrial problems. Under his leadership, the company worked with leading industry users in quantum, and positioned itself at the forefront of near-term quantum advantage. Prior to founding KIPU, Daniel worked on quantum computing strategy and applications at McKinsey & Company, where he advised global clients across chemicals, pharmaceuticals, energy, and finance on the commercial potential and realistic timelines of quantum technologies. He later joined BASF SE, contributing to early enterprise-level quantum initiatives and helping bridge emerging quantum capabilities with concrete industrial R&D and optimization use cases. Daniel’s background combines hands-on scientific research with business execution. He holds a Ph.D. in Chemistry from Karlsruje Institute of Technology, where his research focused on advanced computational and physical chemistry topics. This foundation enables him to translate complex scientific concepts into practical technology strategies and scalable products. He is an active speaker and contributor on quantum computing, commercialization, and deep-tech entrepreneurship, regularly engaging with investors, corporates, and policymakers. In this report, Daniel contributes perspectives on key quantum use cases, leading players, and major investments, offering a pragmatic, operator-driven view on how value is emerging in the quantum ecosystem today. In This Episode: (00:00) Why quantum matters to institutional investors now (04:39) Daniel defines quantum computing as a fundamentally different paradigm (07:54) QPU hardware landscape: multiple modalities in a VHS vs. Betamax race (11:00) From 1980s academic concept to the threshold of commercial use (14:55) What quantum can uniquely solve, and where it still falls short (21:12) Quantum meets machine learning: convergence, not competition (25:55) Elisabetta identifies three unsolved portfolio construction challenges (35:24) Prudent entry point: hardware portfolio or dedicated quantum VC fund (25:55) Three genuinely unsolved problems: inputs, risk preferences, and constraints (42:07) Asset owners likely outbid for talent; quantum washing a real threat Like, subscribe, and share this episode with someone who might be interested, and please take time to leave us a review! Dr. Angelo Calvello is a serial innovator and co-founder of multiple investment firms, including Rosetta Analytics and Blue Diamond Asset Management. He leverages his extensive professional network and reputation for authentic thought leadership to curate conversations with genuinely innovative allocators and thinkers. As the "Dissident" columnist for Institutional Investor and former "Doctor Is In" columnist for Chief Investment Officer (winner of the 2016 Jesse H. Neal Award), Calvello has become a leading voice challenging conventional investment wisdom. Beyond his professional pursuits, Calvello serves as Chairman of the Maryland State Retirement and Pension System's Climate Advisory Panel, Chairman of the Board of Outreach with Lacrosse and Schools (OWLS Lacrosse), a nonprofit organization creating opportunities for at-risk youths in Chicago, and trustee for a Chicago-area police pension fund. His career-long focus on leveraging innovation to deliver superior client outcomes makes him the ideal host for cutting-edge institutional investing conversations. Resources: Dr. Elisabetta Basilico LinkedIn: https://www.linkedin.com/in/elisabetta-b-aa6142/ [https://www.linkedin.com/in/elisabetta-b-aa6142/]Book — Smarter Investing: How Academic Insights Propel the Savvy Investor: https://www.amazon.com/Smart-Investing-Academic-Insights-Investor/dp/303026694X [https://www.amazon.com/Smart-Investing-Academic-Insights-Investor/dp/303026694X]Dr. Daniel Volz LinkedIn: https://www.linkedin.com/in/daniel-volz-3225646a/ [https://www.linkedin.com/in/daniel-volz-3225646a/]Joint article (Volz & Basilico) — Quantum Computing 101: Understanding the Next Computing Revolution [https://archive.sendpul.se/v/5400u/10ge0/]Email Angelo: Angelo.Calvello@pionline.com [Angelo.Calvello@pionline.com]Email Julie: julie.parten@pionline.com [julie.parten@pionline.com] Pensions & Investments [https://www.pionline.com/]Dr. Angelo Calvello LinkedIn [https://www.linkedin.com/in/angelocalvello/]

From Quotrons to AI: New York City Bureau of Asset Management Interim CIO Monte Tarbox on the Transformation of Institutional Investing

When does the Total Portfolio Approach stop being innovation and start looking exactly like a hedge fund? Monte Tarbox has a sharp answer that might surprise you. Host Angelo Calvello of Institutional Edge welcomes Monte Tarbox, Interim Chief Investment Officer of the New York City Bureau of Asset Management, for a sweeping look at three decades of institutional investing. Monte traces the industry from hand-calculated returns and Quotron terminals to Bloomberg, passive indexing, and alternatives. He offers a sharp critique of fee misalignment between asset managers and asset owners, a contrarian take on the Total Portfolio Approach, and a frank view of AI as disruptive reality rather than fad — closing with a bold prediction that a Bitcoin-driven financial crisis is on the horizon and a clear call for LP collaboration. Monte Tarbox is the Interim Chief Investment Officer of the New York City Bureau of Asset Management, overseeing $311 billion across the city's five public pension systems. He previously served as CIO of the National Electrical Benefit Fund and IAM National Pension Fund, and spent five years with IFM Investors. He has led the AFL-CIO Center for Working Capital, serves as a public advisor to the Maryland State Retirement and Pension System, and is a former trustee of the Montgomery County Public School Retirement System and member of the PBGC Advisory Committee. In This Episode: (00:00) Monte Tarbox, NYC Bureau of Asset Management, $311B interim CIO (03:54) Industry origins in 1990: Taft-Hartley plans and early consulting landscape (06:00) Early portfolio construction: balanced mandates, Quotrons, and data scarcity (10:10) Consultants as de facto CIOs: peer groups, returns, and fiduciary cover (13:33) What improved: custody, trading technology, passive indexing, and governance (20:07) Governance evolution: trustee sophistication, derivatives comfort, and the TPA debate (27:51) What's gotten worse: managers capture scale benefits while LPs plod along (36:30) AI is no fad: disruption, job displacement, and decoupling work from income (40:51) Looking forward: LP collaboration, regulation, and a Bitcoin crisis prediction Like, subscribe, and share this episode with someone who might be interested, and please take time to leave us a review! Dr. Angelo Calvello is a serial innovator and co-founder of multiple investment firms, including Rosetta Analytics and Blue Diamond Asset Management. He leverages his extensive professional network and reputation for authentic thought leadership to curate conversations with genuinely innovative allocators and thinkers. As the "Dissident" columnist for Institutional Investor and former "Doctor Is In" columnist for Chief Investment Officer (winner of the 2016 Jesse H. Neal Award), Calvello has become a leading voice challenging conventional investment wisdom. Beyond his professional pursuits, Calvello serves as Chairman of the Maryland State Retirement and Pension System's Climate Advisory Panel, Chairman of the Board of Outreach with Lacrosse and Schools (OWLS Lacrosse), a nonprofit organization creating opportunities for at-risk youths in Chicago, and trustee for a Chicago-area police pension fund. His career-long focus on leveraging innovation to deliver superior client outcomes makes him the ideal host for cutting-edge institutional investing conversations. Resources: Monte Tarbox — Maryland State Retirement and Pension System Public Advisor Profile: https://sra.maryland.gov/profile/monte-tarboxhttps://sra.maryland.gov/profile/monte-tarbox [https://sra.maryland.gov/profile/monte-tarbox] https://sra.maryland.gov/profile/monte-tarboxNYC Bureau of Asset Management (Monte's current organization): https://www.nyc.gov/site/opa/investments/investments.pagehttps://www.nyc.gov/site/opa/investments/investments.page [https://www.nyc.gov/site/opa/investments/investments.page] https://www.nyc.gov/site/opa/investments/investments.pageNational Electrical Benefit Fund (NEBF) — previous role: https://www.nebf.comhttps://www.nebf.com [https://www.nebf.com] https://www.nebf.comIAM National Pension Fund — previous CIO role: https://www.iamnpf.orghttps://www.iamnpf.org [https://www.iamnpf.org] https://www.iamnpf.orgPBGC (Pension Benefit Guaranty Corporation) — Monte serves on Advisory Committee: https://www.pbgc.govhttps://www.pbgc.gov [https://www.pbgc.gov] https://www.pbgc.govMontgomery County Public School Retirement System — Monte is longtime trustee: https://www.montgomeryschoolsmd.org/offices/retirement/https://www.montgomeryschoolsmd.org/offices/retirement/ [https://www.montgomeryschoolsmd.org/offices/retirement/] https://www.montgomeryschoolsmd.org/offices/retirement/Email Angelo: Angelo.Calvello@pionline.com [Angelo.Calvello@pionline.com]Email Julie: julie.parten@pionline.com [julie.parten@pionline.com]Pensions & Investments [https://www.pionline.com/]Dr. Angelo Calvello LinkedIn [https://www.linkedin.com/in/angelocalvello/]

Pricing Uncertainty: What Institutional Investors Need to Know About Prediction Markets

What if you could price geopolitical risk in real time — before it moves markets — using a publicly visible order book anyone can read right now? In this episode of Institutional Edge, host Angelo Calvello is joined by Will Owens, Research Analyst at Galaxy Digital, and Zack Pokorny, Data Associate at Galaxy Digital, to discuss the current state and future trajectory of prediction markets. The conversation draws a distinction between sports-driven gambling activity dominating platforms like Kalshi and Polymarket and what Will and Zack call "signal markets" — focused on pricing the uncertainty of meaningful macro and geopolitical events. They cover impact markets, decision markets, and AI agents as a liquidity solution, with a pragmatic core message for institutional allocators: the information aggregation value is accessible today, but the more expressive, capital-efficient hedging structures that would truly serve large allocators are still maturing. Will Owens is a Research Analyst on the Research Team at Galaxy Digital. Prior to joining the firm, he worked at UTXO Management, a Bitcoin-native hedge fund and venture firm, where he contributed to research and infrastructure. Will holds a degree in Computer Science and Human and Organizational Development from Vanderbilt University, where he also studied philosophy and game theory. Zack Pokorny is a Data Associate on the Research Team at Galaxy Digital. Before joining the firm, he led on-chain research efforts at CEX.IO and served as an Acquisitions Analyst at Steel Wave. He holds a BA in Finance from Elon University. In This Episode: (00:00) Introduction of Will Owens and Zack Pokorny, Galaxy Digital (03:01) State of prediction markets today: sports gambling vs. signal markets (06:11) Why Galaxy Digital focuses on prediction markets and information aggregation (08:23) Next generation markets: impact markets and decision markets explained (14:28) DeFi applications: leverage, borrow-lend, and capital efficiency (19:17) Multi-outcome unification and solving liquidity fragmentation (20:17) AI agents as continuous market makers and liquidity solutions (25:10) Why institutional investors should pay attention to prediction markets now (30:11) Blockchain experimentation, futarchy, and fully autonomous organizations Like, subscribe, and share this episode with someone who might be interested, and please take time to leave us a review! Dr. Angelo Calvello is a serial innovator and co-founder of multiple investment firms, including Rosetta Analytics and Blue Diamond Asset Management. He leverages his extensive professional network and reputation for authentic thought leadership to curate conversations with genuinely innovative allocators and thinkers. As the "Dissident" columnist for Institutional Investor and former "Doctor Is In" columnist for Chief Investment Officer (winner of the 2016 Jesse H. Neal Award), Calvello has become a leading voice challenging conventional investment wisdom. Beyond his professional pursuits, Calvello serves as Chairman of the Maryland State Retirement and Pension System's Climate Advisory Panel, Chairman of the Board of Outreach with Lacrosse and Schools (OWLS Lacrosse), a nonprofit organization creating opportunities for at-risk youths in Chicago, and trustee for a Chicago-area police pension fund. His career-long focus on leveraging innovation to deliver superior client outcomes makes him the ideal host for cutting-edge institutional investing conversations. Resources: Galaxy Digital (employer): https://www.galaxy.comhttps://www.galaxy.com [https://www.galaxy.com] https://www.galaxy.comGalaxy Digital Research Paper — Prediction Markets, Leverage, AI Agents & DeFi: https://www.galaxy.com/insights/research/prediction-markets-leverage-ai-agents-defihttps://www.galaxy.com/insights/research/prediction-markets-leverage-ai-agents-defi [https://www.galaxy.com/insights/research/prediction-markets-leverage-ai-agents-defi] https://www.galaxy.com/insights/research/prediction-markets-leverage-ai-agents-defiGalaxy Digital Research Paper — Impact Markets & Conditional Pricing: https://www.galaxy.com/insights/research/impact-markets-prediction-markets-conditional-pricinghttps://www.galaxy.com/insights/research/impact-markets-prediction-markets-conditional-pricing [https://www.galaxy.com/insights/research/impact-markets-prediction-markets-conditional-pricing] https://www.galaxy.com/insights/research/impact-markets-prediction-markets-conditional-pricingGalaxy Digital Research Paper — Prediction Markets, Impact Markets, Decision Markets & Futarchy: https://www.galaxy.com/insights/research/prediction-markets-impact-markets-decision-markets-futarchyhttps://www.galaxy.com/insights/research/prediction-markets-impact-markets-decision-markets-futarchy [https://www.galaxy.com/insights/research/prediction-markets-impact-markets-decision-markets-futarchy] https://www.galaxy.com/insights/research/prediction-markets-impact-markets-decision-markets-futarchyLinkedIn — Will Owens: https://www.linkedin.com/in/will-owens-b14257238/https://www.linkedin.com/in/will-owens-b14257238/ [https://www.linkedin.com/in/will-owens-b14257238/] https://www.linkedin.com/in/will-owens-b14257238/LinkedIn — Zack Pokorny: https://www.linkedin.com/in/zack-pokorny-392179117/https://www.linkedin.com/in/zack-pokorny-392179117/ [https://www.linkedin.com/in/zack-pokorny-392179117/] https://www.linkedin.com/in/zack-pokorny-392179117/Polyoptions (mentioned by Will Owens): https://www.polyoptions.comhttps://www.polyoptions.com [https://www.polyoptions.com] https://www.polyoptions.comPlatforms referenced in episode — Polymarket: https://polymarket.com [https://polymarket.com] and Kalshi: https://kalshi.comhttps://kalshi.com [https://kalshi.com] https://kalshi.comHyperliquid (mentioned by Will Owens, Galaxy Digital has disclosed an interest): https://hyperliquid.xyzhttps://hyperliquid.xyz [https://hyperliquid.xyz] https://hyperliquid.xyzEmail Angelo: Angelo.Calvello@pionline.com [Angelo.Calvello@pionline.com]Email Julie: julie.parten@pionline.com [julie.parten@pionline.com] Pensions & Investments [https://www.pionline.com/]Dr. Angelo Calvello LinkedIn [https://www.linkedin.com/in/angelocalvello/]