CPDO’s – Yelling Fire in a Crowded Theater
Ratings and Rating Agencies Before going into the details of how CPDO works, it is worth talking about rating agencies, what they are, and what they do. I think in most cases they do a good job, yet I would never rely on them. I think their “single name” issuer ratings have had a pretty […]
The T Report: A Time to Think & 5 Key Issues
Time to Think Last week was a feeding frenzy for algos and a disaster for those who were poorly positioned. Crowded complacent trades were pummeled, including, or especially, investment grade CDS. But now we have had some time to think about what happened and the markets seem calmer. On this bond market holiday, let’s just […]
TFMkts Weekly Fixed Income Summary and Portfolio Allocation Strategies
Risk Off This was clearly a “risk off week”. Unlike equities which started the week well, credit markets didn’t even start the week well. They did join equities in the post election and post ECB sell-off. The decision to switch from a more aggressive risk taking position to a more neutral position made sense. Treasuries […]
Fixed Income Strategy Allocation Update
Fixed Income Update In “core” cutting BAB from 20% to 10%. Raising HY to 30% from 20%. In “traded” cutting BAB from 20% to 0%. Taking HY back to 30% up from 15% last week, and 20% from when we added earlier this week. Adding a 5% allocation to Investment grade. In “aggressive” selling BAB […]
The T Report: A 200 DMA Breech with 66% Fib & IHS + Wave C
Algos Gone Wild There are a lot of reasons for the markets to be doing what they are doing this week. The election and the situation in Europe are chief among those reasons. Yet I can’t help but think that positioning remains the biggest problem (I will post my “crowded trade” memo from last night […]
The T Report: Just Another Manic Thursday
What Next? There is a lot of concern about yesterday’s move. I think they are wrong. We have had several large moves in the past week (greater than 0.75%) and have had reversals the next day. In most cases, the reversals themselves were large moves. It is hard to get extremely bullish here with everything […]
Afternoon T Report: A Lot to Catch Up On
Quick Recap This morning’s risk off note was short and to the point. And more right than I would have guessed. When I started typing the report stock futures were higher on the day. As short as the report was, I couldn’t type fast enough, to get it out before futures had turned red. But […]
The T Report: Risk-Off
We may get a bounce because the “uncertainty” is gone. It isn’t. Fiscal cliff is uncertain. Europe is uncertain. China is uncertain. Earnings are uncertain. Some of the people saying buy the dip are the same people who said a Romney win was sure to be good for the market (which I disagree with). […]
The T Report: The 3rd Most Important Vote This Week
I Just Can’t Get Excited In theory I should be excited about the prospects of the election today, but I just can’t get worked up. I’m not sure this is even the most important vote this week in terms of the markets. Chinese and Greek voting ranks right up there. I’m not even sure this […]
The T Report: A Paucity of Change, Greece & CPDO
On Election Eve and all through the house it’s as quiet as a mouse Maybe it is just me, but the election already seems anti-climatic. After what seems like close to 3.5 years of campaigning, the election is finally upon us. Maybe it is the length of the campaign, or the after effects of hurricane […]