The good news keeps arriving regarding the CoViD-19 vaccine together with a continued increase in the infections worldwide. We can now be reasonably certain that the pandemics will be brought to heel in second half of 2021. The stock markets react as if the virus has...
The joint statement from Pfizer and BioNtech of successful phase three trials of vaccine against CoVid-1 has the potential to be the next game changing event in the SARS 2 CoViD-19 saga. We are nowhere near having the vaccine generally available. The immediate impact...
New benchmark recommendations from ESMA aim to correct the way funds are using benchmarks. Since the introduction of the Benchmark Directive in 2018, many funds have effectively removed relevant benchmarks and replaced them by money market rates. Given the strong...
The Covid pandemic (a once in a century event, one hopes) again accelerates briskly across Europe. The US Federal Reserve Bank has revised its policy objective (a once in three decades event). Debt levels are soaring (to historically unprecedented levels). A UK hard...
Active Risk Allocation (ARA) update: The recommended risk allocation has stabilised around neutral after a short period of advising slightly below average risk exposure. Seen from a top-down view allocation is merely simmering around neutral towards benchmark...
Active Risk Allocation (ARA) update: Asset allocation has for decades been known to be the most important single factor for investment return. Our Active Risk Allocation aims to get the balance between asset classes right. Sometimes we can also derive useful...
Active Risk Allocation (ARA) update: The recommended portfolio risk allocation is slowly falling below neutral after an extended period of elevated risk exposure. Several factors are changing yet again and none of the changes are for the better. USA’s failure in...
A bungled response in the USA to the pandemic now threatens to derail the global economic recovery. The US economy will likely shrink by 3-4% in 2020-22. A Federal Reserve Governor says a “thick fog” of uncertainty is surrounding the US economy. Despite extraordinary...
On 25 May 2020 we wrote that something was afoot in the financial markets. We observed that both bond markets and stock markets were gaining on a global scale. It began to look like a rerun of the dynamics of January 2020 that led up to the stock market crash in late...
We are getting worried. Not about the progress of the Covid-19 pandemic, but about specific areas of the financial markets. We have a sneaking feeling that the markets are heading straight for a situation where a risk-off reaction could wreak havoc on the stock...