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Posted on 11th Jun 2020 by the LSS team
#market views
Last Monday, the S&P 500 returned positive year-to-date which is quite remarkable following the Covid-19 pandemic and resultant liquidity induced 34% correction witnessed mid-March.
The Federal Reserve, and indeed other major central banks, unleashed unprecedented monetary stimulus to deal with this exodus of liquidity from risk assets.... Read More
Posted on 19th Jun 2020 by the LSS team
#market views #weekend thoughts
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As I sit out here in Asia watching my Bloomberg screens on a late Friday night / early Saturday morning I thought to share a few quick thoughts on the markets with you all. On my screen I see predictable headlines passing by about Ray Dalio warning that we may be looking at a "zero decade" for US stocks as profit margins reverse, JPMorgan discussing the highest ever levels in cross-asset correlation and another warning to add to the pile of endless screaming about how Robinhood traders are going to be the sole cause of the biggest bubble ever. Nothing new under the sun.... Read More
Posted on 27th Jun 2020 by the LSS team
#investment process #diversification #market views
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So far, 2020 has been nothing if not a wild ride for financial markets. The S&P500 started the year on a slow upwards grind and was up as much as 5% by February (which would have been a respectable result for the entire year if it had only stayed there). It then started dumping to the bottom from 19th February onwards, eventually going as far down as -30%. We all know what happened next as central banks stepped in to save the day, one after the other. Today, it would appear to me that markets remain fragile as risk levels remain elevated and concerns about things like global economic growth and the impact of COVID-19 but also geopolitics, trade friction, upcoming US elections etc. continue to weigh on sentiment.... Read More
Posted on 2nd Jul 2020 by the LSS team
#market views #stocks #diversification
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One of the more interesting things I've observed in the markets over recent years is that while there has undoubtedly been inter-asset class integration (meaning during periods of turmoil correlations tend to 1 between stocks, bonds, real estate, commodities etcetera), we have actually observed intra-asset class divergence in many places. Or to put it in a more quantitative way: the correlation of for instance Netflix and Amazon with the S&P500 was lower than that of emerging market stocks and real estate to the S&P500 during the worst of the 2020 sell-off.... Read More
Posted on 18th Jul 2020 by the LSS team
#signals #market views
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What's up LSS readers, hope you are all enjoying your weekend. We sure have, as a bit of normality seems to be returning to life in the crazy new COVID-19 world we are all facing. Today we want to share with you an exclusive snapshot of the latest signals we make available to our Premium subscribers. If you sign up for a premium account you can get these delivered straight to your mailbox as and when they get triggered but as a one off we would like to make our calls available to a broader public today.... Read More
Posted on 24th Jul 2020 by the LSS team
#market structure #Cryptocurrencies #correlation #market views #weekend thoughts
I make it a habit to study both the micro structure and the macro structure of the market. What I mean by that is that I may spend a lot of time looking through correlation matrices, studying market structure and broader patterns over longer term data, but despite not really being much of a day trader I also find myself glued to Bloomberg screens daily to watch the minute and second ticks of a large number of asset classes. The reason I do that is that I believe often the micro charts provide information about market changes that are going to go on to become longer term trends.... Read More
Posted on 9th Aug 2020 by the LSS team
#market views #weekend thoughts #inflation #stagflation
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I haven't done one of these in a while so figured today might be a good moment to pause and talk through the recent state of financial markets. 2020 has been a rollercoaster ride with a 35% equity sell-off and subsequent full recovery, a bond market rally that saw rates moving from 2% to 0.5% and never climbing back up, enormous dollar strength then weakness, the Fed buying sub investment grade corporate bonds. Gold is at an all-time high and crypto is moving there slowly.... Read More
Posted on 21st Aug 2020 by the LSS team
#market views #weekend thoughts
For better or for worse, 2020 remains very much a US dollar story, with the currency at first whipsawing markets back in March as DXY spiked to 102 during the dollar funding squeeze and as of today having come down to a 92 handle. Speaking of which, the stock market sell-off we saw in March gets compared to other historical shocks like the GFC in 2008, but in reality - and as I have remarked here a few times - it was really a dollar story.
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Posted on 14th Mar 2021 by the LSS team
#market views # crypto
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For what it’s worth, I am still buying Bitcoin here. In my previous write-up I noted that my base case was a ranging between 45-55K unless a further move up was sparked by stimulus, large institutional buyers or in general easing conditions in traditional markets where both dollar and interest rates had been acting up a little bit. I think at least two out of those three have now taken place causing a short squeeze over the 13-14 March weekend and renewed momentum.... Read More
