“Risk is not a story; it's not a relationship; it's not a feeling. Risk is a number: it's the probability of loss weighted by the expected degree of loss.”
- Benjamin D. Summers
OUR ARCHITECTURE
Where a first-principles research mandate governs the management of institutional capital
Mathematical physics operates on first principles and empirical proof; institutional finance largely operates on consensus and convention. Adagio Group was founded to apply the discipline of the former to the domain of the latter. This foundation is expressed through our institutional architecture, which is defined by three governing principles:
1. A First-Principles Definition of Risk. We reject variance as a proxy for risk. Our methodologies are built from the mathematical definition of risk: the probability of loss weighted by the expected degree of loss. This is not a preference; it is a logical necessity for navigating markets that exhibit non-Gaussian behavior, particularly during crises. The performance of this framework has been third-party verified since 2007.
2. Markets as Complex Adaptive Systems. We recognize that markets are not efficient equilibrium machines. They are complex systems that generate persistent signals and structural patterns invisible to conventional analysis. Our framework is designed to detect these signals across multiple time scales and market regimes, from quiet periods to sudden liquidity events.
3. A Closed-Loop Intellectual Architecture. Our OCIO platform is the direct output of fundamental research from our capstone entity, Adagio Institute. Theoretical breakthroughs in econophysics and financial mathematics are engineered into deployable strategies. In turn, market data from our platform continuously stress-tests and refines our theoretical models. This creates a new standard of empirically-validated performance.
“[Most] investors may be quite willing to take the risk of being wrong in the company of others, while being much more reluctant to take the risk of being right alone.”
- John Maynard Keynes
OUR PLATFORM
An integrated intellectual architecture for institutional investment built on a foundation of first principles
Our work with a select group of university endowments and family offices is defined by a single, end-to-end process. This platform is the operational expression of our core premise, ensuring that our intellectual framework is applied with institutional discipline at every stage. This architecture is comprised of three integrated components:
1. Foundational Research: The Adagio Institute
Our platform is the direct output of fundamental research from our capstone entity, the Adagio Institute. Theoretical breakthroughs in econophysics and financial mathematics are engineered into deployable strategies. In turn, market data from our platform continuously stress-tests and refines our theoretical models. This Closed-Loop Intellectual Architecture creates a new, proprietary standard of empirically-validated performance.
Summers MEASURE & INVESTMENT CHARACTERISTICS MATRIX
Rigorous quantitative analysis is unequivocally the only responsible method of determining asset quality and informing portfolio construction. Of the risk-adjusted performance measures, the Summers Total Risk-Adjusted Performance Measure is the only one that captures all four statistical moments while providing a user-friendly output as a percentage relative to the market. The Summers Investment Characteristics Matrix paints an accurate, comprehensive picture of the risk, return, and liquidity characteristics of any asset or portfolio regardless of asset class—from equities to real property.
2. First-Principles Portfolio Engineering
Our quantitative engineering desk translates our foundational research into an active investment process. We engineer investment products and portfolios from first principles, translating advanced mathematical frameworks into robust, operational code that implements techniques from signal processing, dynamic mode decomposition, and neural network integration. This engineering process involves several core applications:
- Multidimensional Risk Assessment: Utilizing proprietary frameworks like the Omega Ratio and the Summers Investment Characteristics (SIC) Matrix to capture the complete return distribution.
- Dynamic Allocation: Employing Bayesian signal integration to adapt to evolving market conditions, as demonstrated by the adaptive weighting of signals in our research.
- Systematic Performance Verification: Measuring all outcomes against the Summers Total Risk-Adjusted Performance Measure (Summers Measure), a true, comprehensive standard of risk-adjusted performance.
- Bespoke Product Engineering: Designing private structured products for qualified institutional partners who require risk-defined solutions for specific mandates.
3. The Outcome: A New Standard of Fiduciary Governance
Our platform delivers a level of transparency that transcends narrative explanations. The result for our partners is unambiguous, quantitative attribution and a comprehensive decomposition of risk. This allows a governing body to fulfill its fiduciary duty with a complete and empirically-validated understanding of its portfolio, establishing a new and superior standard of institutional governance.
“How much you truly 'believe' in something can be manifested only through what you are willing to risk for it.”
- Nassim N. Taleb
THE PRINCIPALS
Benjamin D. Summers
Managing Director & Founder
Ben architected the firm's first-principles approach to institutional investment, applying a framework derived from econophysics and complex systems theory to the domain of financial mathematics.
His foundational research, conducted through the Adagio Institute, has produced a new generation of proprietary methodologies for navigating non-Gaussian market behavior. These include the Summers Total Risk-Adjusted Performance Measure and the Summers Investment Characteristics Matrix. He is the author of the firm's unifying research paper, The Standard Model of Complex Economic Systems.
Benjamin earned his Bachelor of Science in Physics from Louisiana State University. His professional career has spanned distinct domains of high-performance, from a career in professional baseball with the San Diego Padres organization to senior leadership in the global energy sector. This multi-disciplinary experience informs the firm's unique, first-principles approach to risk and complex systems.
He is a member of the Forbes Finance Council and author of the international bestseller, The Shadow Banker's Secrets: Investment Banking for Alternatives.
Dr. Kurtay Ogunc
Director - Academic Affairs
Kurtay is responsible for academic initiatives under Adagio Institute providing senior guidance on the firm's research and institutional initiatives. He is also the Director of Undergraduate Studies & Research, Director of the Asset Management Academy, and Director of the Quantitative Finance Club in the department of finance at LSU.
In addition to his academic career, Kurtay has served in the public and private sectors over the last three decades, most recently as the Senior Investment Officer for Risk Management and Asset Allocation in the Mayor’s Office for Pensions and Investments at the New York City Retirement System. Additionally, Kurtay served as the first investment manager for the LSU endowment.
Kurtay received his PhD in Decision Sciences (Asset Management, Stochastic Processes and Econometrics) and Master of Applied Statistics (Binary Choice Models and Bayesian Theory) from LSU and his MBA in Finance from Western Michigan University.
“I want a guy who knows enough math so that he can use those tools effectively but has a curiosity about how things work and enough imagination and tenacity to dope it out.”
- Jim Simons
CAREER OPPORTUNITIES
Careers at Adagio
Adagio Group is not a conventional financial institution. We operate at the intersection of mathematical physics and institutional finance. Our technical talent is developed exclusively through the rigorous curriculum of our research affiliate, the Adagio Institute. Our partnership ranks are reserved for a different but equally rare skill set. We are in continuous dialogue with established leaders who possess the deep network and political capital to navigate the highest levels of institutional finance, and the intellectual horsepower to operate as a peer in a first-principles environment.
A Note for Future Principals
Our model requires a small number of principals who can function as trusted, confidential advisors to the boards and investment committees of major institutional allocators. This is not a sales or distribution role. It is a long-term, strategic function built on unimpeachable integrity, a history of institutional success, and a fundamental alignment with our mission to challenge the flawed conventions of the investment industry. This path is reserved for individuals whose professional history and intellectual framework are self-evident.
To Initiate a Private Dialogue
For those who recognize themselves in this description, we maintain an open and confidential channel for principal-to-principal discussions.
EQUAL OPPORTUNITY EMPLOYER DISCLOSURE: It is the policy of Adagio, LLC to ensure equal employment opportunity without discrimination or harassment on the basis of race, color, religion, creed, age, sex, gender, gender identity or expression, sexual orientation, national origin, citizenship, disability, marital and civil partnership/union status, pregnancy (including unlawful discrimination on the basis of a legally protected pregnancy/maternity leave), veteran status, genetic information or any other legally protected characteristic.
“An investment in knowledge pays the best interest."
INSIGHTS & RESEARCH
The Briefing Room
For principals of endowments, family offices, and other institutional allocators, this collection contains the foundational research and strategic frameworks that govern our platform.
The Intellectual Foundations (Core Research)
An Intuitive True Total Risk-Adjusted Performance Measure and Characteristics Matrix
Technical paper for practitioners introducing a suite of proprietary metrics, including the Summers Measure and the SIC Matrix, that provide a complete, mathematically robust method of portfolio analysis.
The Standand Model of Complex Economic Systems
Mathematical econophysics paper introducing a unified framework that integrates signal processing, operator theory, and Bayesian inference to model financial markets with empirical rigor.
The Institutional Framework
The Public Narrative
BLANK
From the Founder's Desk
For the broader community of accredited investors, RIAs, and financial professionals, Benjamin Summers wrote the international bestseller The Shadow Banker's Secrets and provides ongoing commentary on markets, risk, and the first principles of investment through his Substack newsletter of the same name. With over 100,000 accredited investors and 10,000 institutional representatives, it is a leading platform for sophisticated, unconventional financial analysis.
The Shadow Banker's Secrets
INVESTMENT BANKING FOR ALTERNATIVES
Benjamin D. Summers
Foreword by Oren Klaff
Protect Your Portfolio from Market Crises While Generating Above-Market Returns, Create Capital and Become Your Own Bank
#1 INTERNATIONAL BESTSELLER IN 9 INVESTING & FINANCE CATEGORIES
The Shadow Banker's Secrets
INVESTMENT BANKING FOR ALTERNATIVES
Benjamin D. Summers
Foreword by Oren Klaff
Protect Your Portfolio from Market Crises
While Generating Above-Market Returns, Create Capital and
Become Your Own Bank
The Shadow Banker's Secrets
CUSTOM JAVASCRIPT / HTML
The Shadow Banker's Secrets
Benjamin D. Summers
Foreword by Oren Klaff
Protect Your Portfolio from Market Crises
While Generating Above-Market Returns,
Create Capital and Become Your Own Bank
#1 INTERNATIONAL BESTSELLER IN 9 INVESTING & FINANCE CATEGORIES
The Shadow Banker's Secrets
On Substack
CUSTOM JAVASCRIPT / HTML
The Standard Model of Complex Economic Systems [WORKING PAPER]
March 2025
(This working paper presents the comprehensive theoretical and empirical framework underlying Adagio Group's successful investment strategies, now being transitioned to academic publication. Components of this framework are being prepared for submission to peer-reviewed journals.)
This paper introduces a comprehensive theoretical framework termed ”The Standard Model of Complex Economic Systems” that bridges econophysics, signal processing, and portfolio theory using Hilbert space methods. We develop a unified approach that integrates fundamental analysis with sophisticated quantitative methods, applying Bayesian inference in function spaces to signals extracted from spectral analysis, wavelet decomposition, and operator-theoretic analysis of financial time series. The primary objective is to optimize the Omega ratio for leveraged liquid assets that have passed specific fundamental screening criteria. This dual-methodology approach addresses a significant gap in current practice: fundamental analysis establishes intrinsic value baselines while Hilbert space methods identify market signals that enable predictive modeling of period total returns. We introduce the Summers Total Risk-Adjusted Performance Measure (Summers Measure) with functional extensions that provide improved interpretability while preserving higher-moment sensitivity. Empirical testing demonstrates that our approach significantly outperforms traditional optimization techniques, particularly during market regime transitions and periods of high volatility. The framework contributes to the theoretical understanding of financial markets as complex adaptive systems while offering practical applications for investment management. By providing a physically interpretable model of market dynamics grounded in functional analysis, this paper establishes a foundation for a new paradigm in quantitative finance.
An Intuitive True Total Risk-Adjusted Performance Measure and Characteristics Matrix
January 2023
Keating and Shadwick’s Omega ratio captures all four statistical moments of risk but has practical limitations with respect to portfolio optimization. Kapsos et al. simplified the Omega ratio into an expression with better practical application, but its focus as a portfolio optimization tool represents a trade-off with respect to absolute risk-adjusted performance measurement. First, we've transformed the Kapsos form of the Omega ratio in an analogous manner to what Modigliani did with the Sharpe ratio to create an intuitive percentage output scaled against the market. Second, we’ve deconstructed the Kapsos form of Omega to create a 3 x 1 matrix that measures and intuitively communicates the three fundamental characteristics that define an investment: risk, return, and liquidity.
Be a Better Fiduciary: Private Structured Products & Quantitative Risk Analytics for Financial Advisors
February 2018
(This paper details the core philosophy behind our use of bespoke private structured products. While originally framed for financial advisors, its central argument on the duties of a modern fiduciary is directly applicable to institutional allocators. It establishes the 'why' for this critical component of our platform. The specific 'how'—the proprietary engineering of these solutions—is now governed by the more advanced frameworks detailed in our core research, such as the Summers Measure and the SIC Matrix.)
Most financial advisors adhere to a very traditional asset allocation model built entirely upon public securities. Outside of the fact that a set of relatively vague, qualitative criteria govern the literal value of their clients’ life work, the substance upon which those models are predicated is a set of assets completely dependent upon schizophrenic secondary markets...
Investment Banking for Private Real Estate Operators
June 2017
Investment banks are intermediaries that, amongst many other functions, help typically large companies raise capital by advising on and underwriting new securities issues. To prepare for a new issue of securities, investment banks first advise their clients on considerations such as capital structure (how much debt vs. equity should be issued; what types of equity and debt should be issued, etc.), the strategic use of other financial instruments (such as warrants), and...
Investment Clubs: Gain the Exclusive Access of the Top 1%
May 2017
April 2017
Every investor — from the guy who bets on physical currency by hiding it under his mattress to Ray Dalio — is concerned with risk. Somewhat surprisingly, despite the fact that the vast majority of people are risk averse, very few have any idea what risk actually means or how to measure it… this group includes many, if not most, financial professionals. Ironically, despite retail investors’ often stated aversion to risk, they tend to solely focus on the projected return...
From Wall Street to Main Street
July 2016
Most real estate investors face the nearly impossible task of competing for the few quality deals in their market against tens, if not hundreds, of deep-pocketed, well-connected and established investors already there. To survive, new and undercapitalized investors are forced to work many fruitless hours blindly mailing, calling, driving and knocking on random doors to find whatever scraps may be left over. After all this effort, in the rare instance a good deal is finally secured...
January 2015
One of most prolific and powerful tools of “creative” finance in real estate is the lease-option, but this tool represents only the proverbial tip of the iceberg when it comes to the most powerful breed of derivatives in the investing world, options. There are two basic types of options: the call option (or “call”) and the put option (or “put”). A call is what is utilized in the traditional lease-option; the put, on the other hand, is virtually unheard of in the world or real estate. An option...
Determining Equilibrium Value for Residential Real Estate
March 2013
(This paper serves as a foundational case study in the Adagio methodology. It demonstrates how we dismantle a conventional, narrative-based valuation model ("comparable sales") and replace it with a rigorous, first-principles framework derived from corporate finance. The subject is real estate; the principle is universal.)
One of the most pervasive challenges facing the residential real estate market is the determination of property values. As a result of TARP and other federal subsidies to institutional mortgage lenders, in addition to administrative incompetence, the foreclosure pipeline has been clogged. The expected glut of inventory resulting from the mortgage and financial crisis has yet to materialize, and correspondingly, prices have been lifted by artificially limited supply...
Deciphering Monetary Policy as a Means to Beat the Market
October 2012
(This paper details the first-principles critique of the post-1971 monetary order that serves as the foundation of our institutional worldview. While our tactical implementation has since evolved into a comprehensive OCIO platform, the core diagnosis of systemic risk articulated in this document remains our unwavering guide.)
Monetary policy and its effect on the markets can often seem as an impossibly complex, if not opaque dynamic. The market obviously responds, and most often in a seemingly positive manner, to the actions taken by the Federal Reserve System and statements by its chairman, Ben Bernanke… but how and why, and what are the less obvious effects of a centralized monetary system...
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