I will be the first to say that rules, if not meant to be broken, were made to be bent. The grand central bank policy experiment of ZIRP and NIRP is effectively a bending of economic theory that, other than supporting asset prices, hasn’t provided the inflation boost they were projected to have. For … More What Happens to Absolute Return When Rates Rise
Many of us chart watchers keep constant vigil on the activity of different indicators, looking for signs that help us to make better investment, or disinvestment, decisions. Some indicators are very arcane, the implications of which escape the understanding of many everyday savers. For much of the last 2 years, analysts and investment advisors (yours truly included) have been justifiably … More Fat Lady Not Singing…Yet
The Federal Reserve released the minutes from the July 26-27 meeting. The market was waiting on baited breath for something, anything to cause a ruckus. The VIX Index, or Fear Index, was up 1.07 at one point, to 13.71. After the release of the minutes though, it crumpled down to 12.19. Most of you are … More The Fed and the VIX
Recent action in the price of crude requires some attention. Needless to say, drillers have found some relief, with both West Texas Intermediate and Brent bouncing nicely off the bottoms created in January. As to be expected, petroleum producing countries again seem to be ratcheting up the rhetoric to support prices, in spite of … More Quick Note on Crude Oil
We are at a point that, for the past 2.5 years, I though was improbable. The Fear Index, or CBOE Volatility Index (VIX), closed today at 11.68. The lowest it has been this year is 11.39, and the lowest it has ever been is 9.31, way back on December 22, 1993, in the latter parts of … More VIX – The Fear Index
One of the principal challenges in managing investment strategies, or even quantitative strategies for that matter, is understanding why they can under perform. This week, the market was struck by increased volatility in Gold and Silver prices, before and after improved labor data announced on today. As volatile long bond and precious commodities can be, it is fascinating to see … More Absolute Return – Absolutely
Last week, I worked on sister strategy of the Absolute Return model to include Gold and Silver in the formula. As most are well aware, the iShares 20+ Year Treasury bond ETF – TLT – is a safe haven asset, that turns against the investor as inflation takes hold and interest rates rise. Gold is also a safe … More Absolute Return with Gold & Silver
As it stands right now, my model clearly favors TLT – iShares 20+ Year Treasury Bond ETF – as the core position for next week, fourth in a row. In that time, Absolute Return is up 5.9% and the only asset class that comes close is precious metals. Silver is up 14.21%, Platinum is up … More Ignore the Noise – Absolute Return
Today, Grant Williams, macro strategist extraordinaire and co-founder of Real Vision TV (with Raoul Pal), posted a video on the RV site titled “Crazy”. In it he summarises the mind boggling global debt situation and goes on to highlight some of my favourite arguments that I refer to in my blog regarding the relative “bonanza” … More “Crazy” in love with UST’s
The first half of 2016 has come and gone, to the relief of some and excitement for others. As I have stated previously, the model used by my Absolute Return strategy is a formula that allows me to ignore the noise of the markets and focus solely on relative price behavior. To be clear, I do … More Absolute Return Mid-Year Report
