Todd Rapp got his career started in equity options at Goldman Sachs in the late 1990’s, a wild time in which a bubble inflated and burst and provided critical lessons in both gamma and vega risk in the process. Now the CEO of the Fortress Multi-Manager Group, Todd leans heavily on his derivatives DNA in the areas of sourcing uncorrelated return streams, portfolio construction and both measuring and managing risk. Early training has shaped his long-term view that markets express probability through delta, option curvature, and distribution structure rather than through static price movements. Our conversation connects early risk management lessons to today’s landscape, where market concentration echoes 1999, yet correlation conditions differ meaningfully. Todd notes that unlike the prior cycle, today’s equity index shows low intra-index correlation, making dispersion, risk sizing, and factor neutrality more fundamental for return generation. We also explore how the multi-manager architecture seeks to harness uncorrelated strategies packaged with capital efficiency and leverage, producing return streams engineered to operate through dispersion. Todd highlights how understanding optionality remains central to managing equity factor shocks, beta instability, and correlation convergence events. Lastly, we touch on the human capital side of building a business. Having interviewed hundreds of risk takers over the years, Todd looks for individuals who have something to prove, suggesting that having experienced adversity is important because, “if you don’t have a significant drawdown in your past, it’s in your future.” I hope you enjoy this episode of the Alpha Exchange, my conversation with Todd Rapp.
