Time for Some Hedging?
The economic calendar is extensive with a focus on housing and consumer behavior. Expect market participants to look for any sign that the economic recovery is stalling in the face of the COVID-19 surge and the slower pace of reopening.
Empirical Support for Tail Risk Strategies
The conventional wisdom is that put options are too expensive to use as “tail risk” insurance against extreme losses in equities. But reports earlier this year of their spectacular success in a fund advised by Nassim Nicholas Taleb prompted me to evaluate whether investors should use them.
The 2020 Survey of the Top 50 Hedge Funds
The value of this year’s annual hedge fund performance survey was turned on its head when a pandemic shut down the global economy and sent securities plummeting. But a deeper look at consistently performing funds revealed managers that as a group have largely been able to weather the storm better than the market and their peers.
The U.S. Treasury is expected to announce a June budget shortfall of about $863 billion, bringing the 12-month total to nearly $3 trillion (or about 14% of pre-pandemic GDP). The red ink will continue. Lawmakers are expected to approve another round of federal stimulus later this month. None of that is worth losing sleep over.
Five Reasons EM Are More Resilient Than in the Past
In a new white paper, the GMO Emerging Markets Equity Team argues that Emerging Markets in aggregate are more resilient today than in prior periods, an important consideration as investors evaluate the rebound the asset class has experienced since late March.
Asia's Information Technology Leap
Software and hardware companies are supporting new forms of consumption in Asia, such as the growing popularity of online games. Portfolio managers Sharat Shroff and Inbok Song discuss the opportunity set for long-term investors.
Market Perspectives Q2 2020: An Uncertain Rebound
A key lesson of 2020 is the importance of staying invested even during times of high volatility. We believe that an appropriately risk-targeted, globally diversified portfolio is as important as ever. Maintaining an optimally risk-controlled portfolio is most desirable.
June Employment Report (and other recent data)
The June job market report and other indicators remained consistent with an unprecedented steep drop in economic activity in March and April, followed by a sharp-but-partial rebound in May and June. Many of these data were collected before the recent surge in COVID-19 cases.