Bridgewater`s solution is to place a lot oI 'spread bets, purchasing one security it considers

undervalued and selling short another one it considers overvalued. For example, it might buy
platinum and sell silver, or buy a thirty-year U.K. bond and sell a ten-year bond. The returns
Irom spread bets tend to be uncorrelated with the over-all market.

Read more
http://www.newyorker.com/reporting/2011/07/25/110725IaIactcassidy#ixzz1cJIpAZ5S

In any market that interests him, he identiIies the buyers and sellers, estimates how much they
are likely to demand and supply, and then looks at whether his Iindings are already reIlected in
the market price. II not, there may be money to be made.

Read more
http://www.newyorker.com/reporting/2011/07/25/110725IaIactcassidy#ixzz1cJL6zAIz
In the U.S. bond market, Bridgewater scrutinizes the weekly U.S. Treasury auctions to see who
is buyingAmerican banks, Ioreign central banks, mutual Iunds, pension Iunds, rival hedge
Iundsand who isn`t.

Read more
http://www.newyorker.com/reporting/2011/07/25/110725IaIactcassidy#ixzz1cJLJQazL

In the commodities markets, the Iirm goes through a similar exercise, trying to Iigure out how
much demand is coming Irom corporations and how much Irom speculators. 'It all comes down
to who is going to buy and who is going to sell and Ior what reasons, Dalio explained.

Read more
http://www.newyorker.com/reporting/2011/07/25/110725IaIactcassidy#ixzz1cJLDWehn

One oI them says that iI inIlation-adjusted interest rates decline in a given country, its currency is
likely to decline. Others are more speciIic. One says that, over the long run, the price oI gold
approximates the total amount oI money in circulation divided by the size oI the gold stock. II
the market price oI gold moves a long way Irom this level, it may indicate a buying or selling
opportunity.

Read more
http://www.newyorker.com/reporting/2011/07/25/110725IaIactcassidy#ixzz1cJLbrjCx

Dalio insists it is still driven by the rules-based Iramework he has built up over thirty years.
'When I`m thinking, What is going on today?,` I also need to make the connection to How
does what is happening today Iit into our Iramework Ior making this decision?` `` he said.
Ultimately, he says, it is the commitment to systematic analysis and systematic investment that
distinguishes Bridgewater Irom other hedge Iunds. 'I hear a lot oI people describing what`s
happening today without the proper historical context and without the Iramework oI how the
machine works, he says.

Read more
http://www.newyorker.com/reporting/2011/07/25/110725IaIactcassidy#ixzz1cJLwosIe