Market Notes

The fall of currencies under the spell of stocks worries strategists is yet another article which points out that risk on/risk off now dominates all securities markets. Fed expansion pushes investors into risk on markets, and even in FX, traditionally a much bigger and liquid market than …

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Things to ponder

• The Worst Risk/Reward in History? Charlie Bilello.

• The Fed is creating a lot of money. Velocity now is low, but when it picks up, we’re in for some serious inflation … probably. The US Govt. bond curve is steepening sharply. This suggests that bond investors are …

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From yesterday

Markets ground higher. Dunno why, that’s just what they do. The writing expensive calls strategy seems to be working. Got nervous and put more trailing stops in place. I collected a list of gold and silver miners. They probably are worth looking into a bit. Some are …

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MLPs

Trading ideas: I have a vague idea that MLPs are going down. I heard someone on a podcast, or caught some Twitter post saying that these were a tax-driven structure that would not survive a downturn. My understanding is that they are bit like REITs for pipelines. Obviously, I …

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Brazil - stockmarket vs BRE. Review arguments made by Dahlia Capital on this week’s Market Huddle!

Beyond Overton has long been worried that for all the shock and awe of Fed money-printing, still conditions are too tight, but that the Fed is painted into a corner because if it loosens …

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As expected, markets recovered, quite a lot to start, but then sagged a bit. In situations like this, probably the best thing to do is to wait for the dust to clear, although a bit of hedging goes a long way.

At 6pm BST a lot of the bounce had …

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Most equity markets markets seem to be turning down.

Yields are going down, a bit.

FX has no clear trend, that I can see.

Today I noticed that Turkey has 11.4% inflation and 13% unemployment. The Phillips Curve obviously doesn’t work very well there. “Policy rates” are at …

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Hard to say what today will bring. Risk-off behaviour from US Treasury futures, Bunds, MIB, HSI, Russia index, gold and MXEA. Risk-on behaviour from HG, AUD (so, commods generally), NQ and VIX. NQ seems utterly unstoppable.

Heard an amazing podcast. Too many ideas to summarize here, but very good on …

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After a week or two of relentless risk on behaviour, culminating in the NASDAQ hitting and all-time high, there is a faint hint of risk-off behaviour today. EM currencies (RUR, MXN, ZAR) are being hit hard, the DAX and MIB are down steeply, oil (CL) is down 2.4%, GC …

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Summary

You kept your portfolio pretty much delta neutral, and you proved that this squelched all the risk, and all the return too.

Gradually, as it became apparent that investors perceive recent changes as signalling that the pandemic is coming to an end, you took off the risk-off hedges. You …

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