#71 - Michael Hunstad, President of Northern Trust Asset Management: AI, Factors, and the Future of Investing (recorded 05/07)

In this episode of The Bull of Wall Street, Jim Worden sits down with Michael Hunstad, President of Northern Trust Asset Management, for a conversation on quantitative investing, compensated factors, AI, tokenization, and the future of global capital markets. Michael shares how his background in mathematics, hedge funds, algorithmic trading, and asset allocation shaped his belief in factor investing. He explains why factors must be persistent, consistent, and compensated, and why controlling unintended risk is critical.The conversation also turns to AI, where Michael shares why he thinks artificial intelligence may be one of the most important developments in modern investing. Jim and Michael also discuss Northern Trust’s work with Saudi Arabia’s Public Investment Fund, the future of tokenization, blockchain, crypto, and why the AI investment theme may still be in its early innings. Key TakeawaysWhy we think compensated factors remain important drivers of long-term portfolio returnsHow value, quality, momentum, and low volatility can work together in multifactor strategiesHow AI can help investors analyze the 97% of company data that traditional models often missWhy network momentum may become a powerful tool for understanding company relationshipsHow AI could reshape stock selection, portfolio attribution, sales enablement, and advisor workflowsWhy tokenization may transform settlement, collateral, and market structureWhy crypto may still be better viewed as speculative unless its portfolio role becomes clearerWhy Michael believes the AI trade is not the same as the dot-com bubbleChapters00:55 Michael’s journey from math, hedge funds, and algorithmic trading to asset management02:44 How factor investing became central to Michael’s investment philosophy03:37 What makes a factor truly compensated05:31 Why factor cycles require long-term discipline06:44 The danger of unintended risk in factor investing10:15 Why the intersection of factors may be more powerful than factor sleeves13:49 How AI is changing investment research15:45 Using alternative data and AI for idiosyncratic stock selection17:11 Network momentum and mapping company relationships19:06 Understanding intangible value through AI22:21 AI, geopolitical risk, and thematic exposure26:56 Northern Trust, Saudi Arabia, and global capital market development33:06 De-globalization versus global financial integration39:29 Crypto, stablecoins, and portfolio utility42:25 Tokenization, collateral, and the future of settlement49:03 What excites and worries Michael about AI52:55 Why AI investing is not the dot-com bubbleGuests Michael Hunstad, President, Northern Trust Asset ManagementSpeakersJim Worden, Chief Investment Officer, The Wealth Consulting Group Follow usLinkedIn: The Wealth Consulting GroupX (Twitter): @WealthCGYouTube: @thewealthconsultinggroup Making Life Better at The Wealth Consulting Group If you’re ready to see how WCG helps advisors grow, subscribe for insights, updates, and resources built to make your practice, and your life, better.Subscribe at bit.ly/wealthcg