Risk Par(i)ty

One of the truisms of the current market is that volatility – both historical and implied –  is historically low, but just how extreme is it? How does this manifest itself in the bond, as opposed to the stock, market? What does it tell us about the risks we may be running by maintaining naked exposures?

Please follow the link to find a brief, but instructive overview of this most burning of  issues:-

17-10-18 Vol

A recent miscellany

Does it make sense to plot multi-decade asset prices on a linear scale? How reliable are macro ‘profit’ estimates? Why is the curve flattening and what will a reduction in Central Bank reserve balances mean for assets?

S0me recent short snaps from my LinkedIn & Twitter feeds plus you can watch my latest update ‘China: Unbalanced’  here, on YouTube Continue reading

Doleful dollar boosts the Base

[An edited version of the following appeared in Moneyweek under the title, ‘What’s unsettling the US Dollar?‘]

Dollar makes worst start to the year since 1985,’  screamed the headlines a few weeks ago in a classic click-bait attempt to get people to read about what they already should know by using a somewhat artificial statistic – after all, since when did the world revolve around what happened specifically between Dec 31st and July 31st?

Continue reading

Pluto’s Republic

The more our would-be Philosopher Kings attempt to display the awesome panoply of their intellectual armour, the more we think, not of the Greek sage from whom they seem to draw inspiration, but of Mickey Mouse’s dopey canine friend.

In bonds, the Bears are mounting another one of their forlorn hope charges against the central bank ramparts which is, in turn, rendering equities a little more expensive in relative, as well as absolute, terms. Commodities, meanwhile, are firmly rooted in mean reversion mode.

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17-07-06 M4 No 7