Hi Sebastien,
Great article showing the sorry state of finance as religious battle between rationalists and behaviorists. Actually, they are just representing the two sides of the same coin. Thus, they should stop confusing the world and start collaborating constructively on the unifying Adaptive Markets Hypothesis (AMH). What is hindering them? Probably the opposite, a total lack of adaptive capabilities. From history the future of the extremists is predestined: "It is not the strongest of the species nor the most intelligent that survives. It is the one that is most adaptable to change."

"The main challenge for investors remains how to devise an investment style that consistently, even if not constantly, outperforms."

How about trend following managed futures CTAs, systematically exploiting the "order within the chaos of financial markets" in the long-term, mixed with passive indexing? Isn't this one of the best solutions, consistently outperforming long-term at least risk-adjusted and science-based on both main parts of the AMH, EMH and Behavioural Finance?

Trend following has been providing exactly that already for decades on average of its benchmark index SG Trend after costs. And is available for all retail investors through mutual funds and ETFs. Mixed with passive equity index ETFs, trend followers significantly reduces their volatility risk, particularly in crashes, due to non- or negative correlation, respectively, without reducing returns.

This was researched well and stated by the Harvard finance professor John Lintner already in 1983 and holds until today. And simple pure trend following is at the core of the realistic Adaptive Markets Hypothesis by Andrew Lo. Therefore, he democratises this approach already since 2010 through AlphaSimplex at low flatfees for ethical reasons.

Thus, even John Bogle - as a dyed-in-the-wool indexer – recognised this investment approach as promising financial innovation, following his own one. Also Eugene Fama confirmed this in his view in the conversation, linked here, as being his "biggest problem of all".

Therefore, I expect this to be the next major investment story after index ETFs, supplementing them well for increasingly volatile times going forward for a long time to come after the turn around of interest rates. Accordingly, the last year was already one of the best years for trend following with the SG Trend gaining 27 percent. This was due to many exploitable trends all over in commodities, bonds, interest rates and currencies. In times of rising interest rates such volatile trends may prevail for decades.

What do you think about it, and why didn't you mention this as an obvious solution to current theoretical and practical challenges? Actually, I am successfully investing in it for 25 years. Even a few years earlier than in index funds/ETFs, which became available in Germany only after trend following. You can find more details on this in my whitepaper with all references: https://www.democratic-alpha.com/whitepaper