| |Why should I hold managed futures? This was a much harder question to answer when bonds had such a negative correlation with stocks. Bond provided safety, yield, and return. Allocations to bonds provided diversification and return during the post Great Financial Crisis period. It protected portfolios when volatility spiked, it generated return during the falling inflation, and it did this through the simple allocation scheme of just holding two assets … Read more Bond-Stock Correlation Should Be Driver of Managed Futures Decision
| |It will be a tough investment world going forward for the simple reason the odds are against you. If you are a blackjack card counter in Vegas, you always know the odds, or the count. You know that on any draw, you can get lucky, but in some environments, the chance of success is just lower. Regardless of how smart you are, if the odds are not with you, your chances of getting good returns are lower. Your job as an investor is to know the odds and deal with the consequences … Read more In a Tough Investment World – Investors Will Need Help Finding Returns
| |The World Economic Forum (WEF) Global Risk Report serves as a useful guide on the broader set of risks that may impact the world over the next year. This report is important because it moves outside the narrow focus of finance and looks at a broader set of risks. Nowhere are economic issues in the top five for impact or likelihood in 2017. This is a big change from the 2007-2010 period. This is the first time economic issues are neither in the likelihood or impact top five. The dominant category is environmental which suggests that commodities markets are most likely to have the immediate impact if there is a shock. Extreme weather and natural disasters have the highest impact and likelihood combination from WEF analysis … Read more WEF Global Risk Report – What to be Afraid of in 2017
| |Managed futures, as measured by the SocGen index, finished negative for the year. Many would have thought this was an odd 12-month return performance given the events of the year. Let’s list some of the big moves: the large equity decline in the first quarter, the equity gains in the fourth quarter, the bond gains and subsequent fall through the year, the dollar move higher, the BREXIT event, the US presidential election, and the comeback in oil to name a few. We could go on with some of the minor markets, but the overall conclusion is that there were trends and there were some large moves … Read more Managed Futures – Should we be Disappointed?
| |The market euphoria since November is all based on expectations of future US policy. Rational expectations of future policy and not the current economy are driving markets. Albeit the US economy has positive sentiment and has shown economic growth improvement, there are still headwinds that may only be mitigated through a change in policies. 2017 will be defined by the implementation of those policies and their effectiveness at reducing the ongoing credit recession … Read more Global Macro on One-Page – Follow the Data and Trump Policy
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