Left foot forward, right foot forward, puncturing the mud, plodding along, the wind in winter, the sun in summer, in the trees’ shadows, patterns of light and dark along the ground, again, again, till the finish line, one certainty: I would be last in the school cross country run. The idea that years later, I would enjoy running, would have made me laugh. Why would anyone run from point A to point A, finishing up where they started in the process striving, struggling and sweating?
I think my younger self was probably missing the point. It isn’t about whether you end up. It’s about the anticipation before you start, arranging your running gear the day before, jacket, t-shirt and shorts, and the most important of all: trainers. You can tell a runner, by their incessant and creative excuses for buying yet another set of trainers. Once you’ve started, it’s all about the journey, in particular, if you’re running somewhere new, somewhere unknown, perhaps somewhere abroad.
There’s something distinctly exciting about tackling that first hill, capturing that first sweeping view high up across the sea or land. The steeper the gradient of the run, the more satisfaction you get from seeing that view.
Of course, you could have taken a taxi, but something would have been lost if you had been travelling at speed, in contact with the artificialness of the air conditioning, instead of feeling the natural breeze. You would never have felt the nuances of the route, the way the view slowly changes in amongst the shifting terrain. At the end of the run, you can also indulge in a burger, because you’ve earnt it.
Each run, each time you push, the seconds slowly roll back from stopwatch, your pace quickens, the distance increases, sometimes a few metres, other times a kilometre, and Strava salutes you. Very few of us will be world record breakers, but we can all break our own records, provided we are disciplined.
In a sense, running is like research. Research is about finding a solution to a challenging problem. Sometimes you can’t exactly solve a problem, but through the journey you can learn a lot, and get closer to a solution. In financial markets, we cannot solve the problem. We cannot understand the market all the time, the signal is weak, the noise is strong. Whilst 100% accuracy is impossible in finance, we can still have a very useful model, with something less than that. We need to keep exploring to get an edge, here and there.
In the problem of forecasting inflation, which is our main focus at Turnleaf Analytics, like many other tasks in markets, it is about breaking up the research into smaller parts. Of course, tools like ChatGPT can help us. However, these tools won’t negate the need for some creative research.
Why didn’t we hit the last number? Is there some data that was missing? Which specific bit of data is the most pressing to find? Is there a way we can improve how we aggregate our data? Can we do some feature engineering to help capture particular nuances of an inflation subcomponent? Is there a way we can improve how we clean the data? Is there something missing in our data pipeline? How can we uncover better ways to improve seasonality, a concept which isn’t static in time? The list of questions is endless, the key to research is picking the most important question first!
Working with a team is crucial too, both in research and running. I recently started running with the London Arab Run Club and it’s motivated pushed me to run faster, and I’m keen to join other running clubs too. On the research side, at Turnleaf Analytics, we’ve been able to tackle problems in time series forecasting that we would not have been able to do individually.
It is challenging work. However, slowly uncovering ways to improve an inflation forecast (or indeed any other forecast), like running that hill, can yield results, and a lot of satisfaction too, getting closer to your goal, one basis point at a time!
Next time you go on a run (or even on a walk), enjoy! If it was easy, everyone would be a record breaker.. but there’s absolutely no reason why you can’t break your own records.