Archive for the ‘Economic Forecast’ Category

Investing in Bernanke – Draghi Markets

January 31, 2012

Chidem Kurdas

Why did hedge funds as a whole disappoint in 2011? One obvious answer is (more…)

Investing for Worst Case Scenario

January 12, 2012

Chidem Kurdas

German national output declined in the fourth quarter.  If the recession caused by the European debt crisis spreads and engulfs the world economy, a crisis situation like 2008-2009 could again develop, with all markets going downhill together. What type of investment will perform in this worst-case scenario?   (more…)

China vs. India Investing

November 16, 2011

Chidem Kurdas

Emerging markets  investments by diversified funds have tended to focus more on China than India. That emphasis may change, (more…)

Can Political Risk Be Hedged?

October 11, 2011

Chidem Kurdas

Financial fears dominate the stock market but another kind of danger lurks in news headlines—-like today’s story about an alleged Iranian-directed scheme to assassinate  Saudi Arabia’s ambassador to the US.  As George Tzanetatos sees it, political threats are too important to ignore. (more…)

Who Will Pay for Bad Mortgages?

September 28, 2011

Chidem Kurdas

The good news is that the US economy continues to grow despite panic rounds caused by the European debt crisis. The not so good news: housing losses continue to drag the economy while regulators, banks, investors and homeowners battle over who will bear the brunt of the real estate bust.

The problem is how to allocate the losses, said Joseph Tracy, executive vice president at the Federal Reserve Bank of New York, (more…)

Shipping Races Against Time

September 26, 2011

Global slowdown is another blow to  shipping, still suffering from the downturn caused by the Great Recession. On the other hand, investors are attracted by low prices and see opportunities in the industry’s expected consolidation. Some hedge funds look to get into deals while others seek distressed assets.

Analysts discussed the prospects at a Capital Link Forum (more…)

My Kingdom for a Hedge!

September 22, 2011

Chidem Kurdas

Today people sold stocks and piled into US Treasuries, driving 10-year yields to another low. Everybody is trying to protect themselves.  Funds are hedging their portfolios but to put up defense against a crash is very costly now. There is no good-value, low-risk place to hide. Risky assets, on the other hand, are cheap.

Buying Treasuries looks like the one thing not to do. (more…)

Paulson Loss From Macro Perspective

September 8, 2011

Paulson & Co.’s widely reported heavy loss in event arbitrage raises a question. Other funds with the similar strategy (more…)

Japan, Volatility Clusters and Baklava

March 17, 2011

Chidem Kurdas

I got the term “volatility clustering” from George Tzanetatos, with whom I recently discussed global risks for an article in Opalesque Futures Intelligence, a publication I edit.   That was before the earthquake and related disasters in Japan. (more…)

Carry Trade and Tech: Barclays, BofA

June 29, 2010

Chidem Kurdas

Analysts parsing market prospects have come up with different investment ideas. You see this among both banks and hedge funds. Barclays Capital’s outlook for the third quarter highlights divergences between countries.

Barclays head of research Larry Kantor notes that there may be more of a carry trade in the next few months. He says markets will bounce back near term but the easy money has been made in the first year of economic recovery and now it’s more difficult.

The people at Bank of America Merrill Lynch Global Research are more optimistic about US stocks. David Bianco, head of US equity strategy, says technology stocks offer low-hanging fruit with little risk, while financial shares promise strong returns. He sees foreign markets as the growth engine, with export-oriented companies doing well. (more…)